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30 Jul 2019

Health Minister Greg Hunt has rejected a call from the private insurance sector to abolish Medicare and force people to take out private cover.

Mark Fitzgibbon, Managing Director of NIB, one of the nation’s largest health funds, argued that the Government should make private health insurance compulsory and only pay for the health cover of those unable to afford it.

He said Medicare faced a similar threat to its sustainability as that faced by private insurers, as the population ages the tax base narrows. Mr Fitzgibbon made the parallel to retirement funding and said the same demographic issue is what led to compulsory superannuation.

“We love this word Medicare, it’s like Bambi,” Mr Fitzgibbon said.

“I don’t want to be seen as the one who wants to shoot Bambi, but I think there’s a better way of delivering universal healthcare which is more efficient and fairer.”

The Grattan Institute, which produced its own report describing the mix of private and public health insurance in Australia as muddled, immediately criticised the NIB idea as self-serving.

Mr Hunt said the Government would not consider the NIB boss’s proposal, describing it as catastrophic.

“We’ve rejected that clearly, categorically, absolutely,” the Minister said.

“But yeah, some people want an American-style system. No.”

 Mr Hunt is trying for a new review of private health insurance with the hope of reducing premiums and arresting the decline in membership. He has called for suggestions from stakeholders.

“I've already been meeting with private hospitals, insurers and medical leaders on the next stage in terms of private health insurance reforms,” he said.

“My goal is to continue to reduce the pressure on health insurance costs, but also to increase the value proposition. You can only do it by actually taking out cost drivers.”

He said the mix of private and public insurance gave Australians choice and provided for innovation and better opportunities.

“We are committed to Medicare for life, forever. But equally we’re committed to private health insurance,” Mr Hunt said.

AMA President Dr Tony Bartone said the Government needed to solve the private health insurance problem soon because too many people were opting out.

“We can’t have increasing numbers of people dropping out, increasing cost being left in the system and increasing premiums,” Dr Bartone said. 

“The Government now has clear air. It's had its term of reviews; it's collated the information. It’s got three years now to actually implement.”


Published: 30 Jul 2019