Dr Rosanna Capolingua discusses private health insurance figures and increasing the income threshold on ABC 720 Perth - Mornings

Dr Rosanna Capolingua is the president of the Australian Medical Association, and joins us.

You're not very happy about this change at all, are you?

DR CAPOLINGUA: This is a change that was proposed in the Federal Budget some weeks ago, and the AMA, from the very beginning, has pointed out the problems with the change, in that it will cause people to drop out of private health insurance. And if you haven't got private health insurance then, naturally, you fall into the public hospitals for care, and our public hospitals are in trouble already and can't cope with any increase in demand.

JAMES LUSH: How have you done your figures on this? How do you calculate, you know, what the changes will be in terms of numbers?

DR CAPOLINGUA: It actually wasn't that difficult, and we engaged Access Economics as well to use the Government's own figures, the Government's budgetary savings that they predicted. Savings they would have made out of not having to pay the private health insurance rebate for all the people that they predicted would drop out based on their changed Medicare levy surcharge. You extrapolate that back, and we worked out that something like 700,000, 800,000 Australians who are insured would drop out, and then the Government admitted themselves, they didn't take into account the fact that many of these would be families, and that children in those families would not be covered and drop into the public paediatric hospitals as well.

JAMES LUSH: So why do you think this decision was made? I mean, how much is the Government thinking it will save by doing this, or, you know, presumably, it's going to cost.

DR CAPOLINGUA: The line item I don't have at the - at my fingertips at the moment, but it wasn't a huge amount of budgetary saving, you're quite right, compared to what it's going to cost across Australia to help support the public hospitals to face the increase in demand.

All the state governments are making a call now on the Federal Government to increase the amount of funding in the public hospitals for them to be able to cope with the patients that will drop their private insurance.

JAMES LUSH: Right. We were doing a story yesterday on the state of state hospitals...

DR CAPOLINGUA: Mmm.

JAMES LUSH: ... and the amount of time we had to wait for some emergency attention. I guess this is just going to exacerbate that.

DR CAPOLINGUA: That's right. I mean, I believe there's been a couple of horrific stories in WA about emergency department waits...

JAMES LUSH: Mmm.

DR CAPOLINGUA: ... and they occur because there is access block. That means there are not enough beds. And we've been calling for the Federal Government to put money into increasing the capacity of the hospitals and increasing beds across Australia.

Now, you know it's not acceptable. We're becoming tolerant. We talk about people waiting for 45 hours in an emergency department and take it in our stride. That is not good enough in this country, it's not acceptable. That's a human being we're talking about sitting in a corridor or sitting in a cubicle the family outside the curtain are stressed, anxious, frightened, waiting for treatment. It's not okay.

JAMES LUSH: What did the Access Economic report say?

DR CAPOLINGUA: The - they predicted, indeed, that something like 800,000 Australians will drop out of private health insurance, and what happens then is, they drop out, fall into the public hospitals, so the demand is increased.

The fact that they have dropped out of private health insurance means that the pool for private health insurance becomes smaller.

JAMES LUSH: Mmm hmm.

DR CAPOLINGUA: And private health insurance premiums will go up.

JAMES LUSH: How much do you expect them to go up by?

DR CAPOLINGUA: Another five per cent on top of the usual five per cent increase. So 10 per cent per annum. That will then make it unaffordable for many other Australians. You know, at the moment, with everything else, you know, petrol prices, food prices, the cost of living going up, interest rates, et cetera, you put an extra hike on private health insurance premiums, more Australians will have to make a choice, find it unaffordable and, again, fall into the public hospitals. It's a crazy scenario.

JAMES LUSH: Okay. So tell me what's going to happen at this hearing, Dr Capolingua? Will you be able to put a cross and what changes do you think you might be able to implement, if any?

DR CAPOLINGUA: The federal AMA have put in a submission clearly pointing out the facts around the changes that will occur due to the change in the Medicare levy income threshold surcharge. So we're going to point out these very issues.

We're going to make a call to the Government that if they continue down this path, they will have to increase funding to the states, for the states to assist the public hospitals to look after the patients that will fall into that area. And, you know, the Government is saying that this change is to protect low-income earners from an unfair tax, what they - what they're claiming.

We're suggesting that, in fact, it will penalise low-income earners because they won't be able to afford their private health insurance and they'll be in the public sector in queues sitting in those emergency departments waiting, as we've described. And maybe they need to think of another way to support those low-income earners. Not in this manner which affects all Australians and their access to health.

JAMES LUSH: Just interested how decisions are made. I mean, you know, putting your Australian Medical Association hat to one side, you look at the decision that's been made, can you see any benefits in it at all?

DR CAPOLINGUA: Oh, I don't know. I think someone in Treasury thought, oh, here's a line item we can put into the Budget to make it look good. Yeah, that's...

JAMES LUSH: That's the only one.

DR CAPOLINGUA: That's the only one - only reason I can understand it.

JAMES LUSH: Well, it's very interesting hearing your thoughts, and no doubt those will be listened to with interest. Thanks so much for joining us today.

DR CAPOLINGUA: My pleasure, thank you.

JAMES LUSH: Thank you. Dr Rosanna Capolingua, who's the president of the Australian Medical

ENDS