The Friends of Medicare group has shown the latest rise in private hospital insurance premiums will cost the Commonwealth health budget the equivalent of running a medium sized public hospital every year. Because the rebate is set at 30%, the amount needed rises every time the funds put up their fees. Friends of Medicare spokesperson and President of the Public Health Association, Professor Fran Baum commented:

This means the current rises come to an extra $85M a year in rebates. That’s enough to cover the state government funding of a medium size public hospital like the New Children’s Hospital in Sydney for a year. The government is effectively handing the private funds a book of blank cheques under written by the taxpayer.

Professor Baum said the Friends of Medicare wanted the government to explain why efficient public hospitals are being starved of funds when the private health insurance industry was being given over $1.6 billion a year, with the option to increase that with fee rises whenever they choose.

People need to know just how huge this handout of public money is, she said. The $1.6 billion a year going to the private health insurance is equal to 15% of the total spent by federal and state governments on our public hospitals and health care systems. It is bigger than the health budgets of South Australia, Western Australia or Tasmania. If that 15% went directly to hospitals and health care it would solve all our waiting list problems and mean all Australians would get excellent care when they need it and at no extra cost. We need to ask the government why public money is propping up private health insurance instead of funding public hospitals.

Friends of Medicare
Australian Council of Social Services, Australian Nursing Federation, Doctors Reform Society, Public Health Association of Australia

Professor Fran Baum,
President Public Health Association of Australia,

Dr Con Costa,
President Doctors Reform Society