More expensive is ok, but only some of the time


You have to assume the same groups railing against the 3.95 per cent increase in private health insurance premiums are equally concerned by budgeted increases in spending on hospitals and Medicare.

But no - for some, increased spending on programs like Medicare and public hospitals is an 'investment' while any increase in premiums is an outrage.

Health minister Greg Hunt announced last week private health insurance premiums will rise by an average 3.95 per cent from 1 April.

This increase is the lowest in a long time and compares well to other areas of health. Federal government spending on public hospitals is currently forecast to rise 5.5 per cent in 2018-19. Spending on Medicare is expected to rise 5 per cent.

Nobody wants to pay more for anything but, given rising utilisation and the ever increasing cost of new technologies, the cost of healthcare is generally rising across the board. It always has.

Obviously, consumers feel the direct financial impact of premium increases, but only the indirect impact of increases in spending on public health programs through the taxation system.

Yet according to Consumers Health Forum CEO Leanne Wells, when it comes to private health insurers, "...this is an industry which has profited from high annual premium increases for the past 20 years and even when, as now seems likely, this year’s rise will be around twice the inflation rate, a rise possibly below 4 per cent is being hailed as good news."

The statement was made in an article that was highly critical of private health insurers. 

HealthDispatch asked CHF why, given they are all subject to the same cost pressures, it is unacceptable for private health insurance premiums to rise while government spending on programs like Medicare and public hospitals can rise at even higher levels.

According to Ms Wells, "The public system is by its nature likely to be more costly because it services community-wide needs, including complex, long-term care for medical conditions, and is also an investment. The private sector largely provides procedure-driven services which are also subsidised by the taxpayer."

Over 11 million Australians have private health insurance while the sector performs around two-thirds of non-emergency surgery and 60 per cent of all surgical procedures.

Somewhat hard to say it does not service community-wide needs.

As for the claim spending on the public system is an investment, with the obvious inference CHF does not believe the millions of Australians with private cover are investing in their own care and the wider health system, it arguably reveals a prejudicial attitude towards private health and the millions of Australians with private cover.

There is no doubt people facing high out-of-pocket costs associated with the use of their private insurance have every right to be frustrated. 

However, can the CHF really claim to speak on their behalf when it has consistently campaigned to make health insurance more expensive?

It is still campaigning to make private health insurance more expensive.

The CHF has backed previous changes to the private health insurance rebate, which contribute to the increased cost of premiums every single year. 

Even now, as it criticises the recently announced premium increase and out-of-pocket costs, CHF continues to question the rebate and calls for higher premiums through its removal from low cost basic policies. Removing the rebate from basic policies, which are particularly important in rural and regional areas, would force people into more expensive products, out of insurance and increase premiums for everyone.

So, it seems more expensive is ok, but only some of the time.