Impact of Means Testing the 30% Rebate
A new Report into the impact of the Government’s policy to means-test the 30% Rebate on Private Health Insurance has concluded that the policy will have a negative impact across the entire Australian health system.
Last year private health funds contributed $12.4 billion in benefits towards the healthcare of the 11.7 million Australians with private health cover, emphasising the importance of the private health sector in delivering a balanced health system.
Government policy measures such as the 30% Rebate on Private Health Insurance, Lifetime Health Cover and the Medicare Levy Surcharge make private cover more affordable, especially for those 5.6 million Australians with private cover who live in households with annual incomes below $50,000.
A new Report by Deloitte, based on ANOP/Newspoll research of 2,000 Australian households, into the impact of the Gillard Government’s policy to means-test the 30% Rebate on Private Health Insurance has concluded it would force Australians out of the private health system and into the public sector; that it would put increased pressure on the public hospital system; and, force premiums to increase, disadvantaging lower income earners who remain in private health insurance.
In summary, the Report found that as a consequence of means-testing the 30% Rebate:
- 1.6 million Australians will exit their private hospital cover (compared to Treasury estimates of only 25,000), with a further 4.3 million downgrading their level of cover;
- Private health insurance premiums will rise 10 per cent above what would otherwise be expected, making private cover less affordable for all Australians; and
- Pressure on the public hospital system will increase as more than 845,000 additional treatments will be required as people withdraw from their private cover at an estimated cost to government of $3.8 billion.
Find out more information about these reports
- Deloitte Report – Economic Impact Assessment of the Proposed Reforms to Private Health Insurance
- ANOP/Newspoll Research – Impact of Means testing the Private Health Insurance Rebate