Winners and losers

Published in The Age 6 January 2007

That private health insurance premiums may not rise as much this year might seem to be good news, but a reality check is worthwhile. For the last five years premiums have risen at twice the rate of inflation, making private health cover less affordable every year for those Australians rich or desperate enough to have such cover. This year the news is that the premiums will still be higher than inflation, just not quite as bad.
Meanwhile, public health insurance premiums — taxes and the Medicare levy — used to fund public health care, have fortunately missed out on such huge increases. Income tax rates have decreased and the Medicare levy has risen only if one's income has increased. The big winner: private health funds' profits; the big losers: all Australians, because every increase in premiums means more taxes into the private funds through the rebate, leaving less to spend on our ailing public system.

Dr Tim Woodruff

President

Doctors Reform Society

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