Home - Claire Moore - Labor Senator for Queensland

BILLS: Private Health Insurance Legislation Amendment Bill 2013

The opposition will be supporting the Private Health Insurance Legislation Amendment Bill 2013. I think people in the wider community know that Labor has always believed it is important to have a sustainable private health insurance industry in Australia. We know that over the last few years this has been a contested area. I am not sure, but I think several times in this place we have had private health insurance bills that have been debated quite robustly-I think that is the term we could use.

The indexation of the private health insurance rebate is something introduced by Labor. It is a budget initiative; it was introduced as a budget process. It is expected to raise about $700 million in savings over the forward estimates. The bill before us does not change that budget position. Basically, the bill looks at the way private health insurers make the calculation to apply the legislation that was previously put through. On that basis, I acknowledge the representations from insurers that the process we now have with the amendment will require less administration. But what is of even more importance is that the rights of policyholders are not undermined.

Consistently through our debates in this place we have been looking at the rights, the security and the engagement of the consumer. This industry in particular depends on people who make the personal choice to take up private health insurance, and I want to acknowledge the representations from the consumer organisations as well as from the insurers about this process. After all, it is a common goal that we make private health insurance work. The intent of this is that it will require less administration on the behalf of private health insurers and it will be easier to implement. The concepts and the arguments that have been put to us by private health insurers have made it clear that this is something they want. When Labor introduced the change last year there was a debate about whether the indexation should be calculated at the product level, as it was in the original process, at the industry level or at the individual insurer level. One of the principal concerns put by the then Department of Health and Ageing, currently the Department of Health, was that implementing the indexation at an industry level, as is proposed in this bill, would put smaller insurers at a competitive disadvantage. That was an argument that we took very seriously, and I think it is important to note that we have listened to people who have come forward with arguments. In the subsequent months smaller insurers, including the peak body, have put it to the opposition that this amendment will make it easier to implement and will require less administration.

The intent of Labor's proposed implementation model was that it would create greater competition and transparency for consumers. It is necessary, absolutely, for the government to demonstrate how this bill will increase transparency and competition. Labor will always support measures that enhance competition, which is consistent with our position that there be a sustainable private health insurance sector in this country. We are the party that is capable of improving competition, but standing up always for consumers.

The government is about promoting competition but sometimes we believe the roll and the absolute importance of consumers can get lost in the argument. So far the government has approved-and it is important to note this, Mr Deputy President-the biggest increase to private health insurance premiums in almost a decade, and this raises concerns about affordability for consumers. The government supports a private health insurance industry having greater involvement in the delivery of health care in Australia, but it is really important that any arguments about further engagement of the private health industry are not about breaking up Australia's system of universal health care and creating a two-tier health system, which exist in places like the United States.

This is an ongoing discussion because there are great concerns about maintaining the integrity of Medicare and a universal health system. We need to maintain the argument, which is more than just yelling at each other or taking entrenched positions; we must ensure that we have the maturity to listen to the arguments carefully to achieve the best possible system. The commitment and the respect that the Labor Party has for Medicare is on record; and that will continue to be part of any future debate. One of the things that colours the discussion is the likely sale Medibank Private. As a consumer of Medibank Private, I always put on the record that I have a personal interest in what is happening to the scheme, which I first joined as a Commonwealth public servant when the old Health Insurance Commission morphed into what we now know as Medibank Private.

In previous debates there has been considerable criticism by the coalition in opposition that the changes the Labor government introduced would undermine the integrity and security of the private health insurance industry and affect the number of people making the personal choice-it is important to acknowledge that it is a personal choice-to take up private health insurance. We know that there are a number of issues surrounding the legislation that encourage that choice; indeed, the legislation states that if you do not take up private health insurance or if you do not take extra cover as you age, there will be taxation implications. Nonetheless, we are always talking about a market industry, and so private insurance agencies and firms need to convince individuals that they have a valuable product to offer and that real choice exists in the market to provide them the options they need in the health system. Private health insurance must always be a market exercise, and that private choice must always be important in anything we do.

We know that at the moment 47.7 per cent of Australians have private insurance for hospital cover and 55 per cent have general cover. We need to keep those figures in mind, and in any debate we need to know that private health schemes are transparent, accountable and inform people precisely of their coverage. It is not in anybody's interest to have skyrocketing private health premiums; and that is something that this parliament and the Community Affairs Legislation and References Committees will continue to watch very closely. We are supporting this bill and we acknowledge the range of people who have been involved-especially the public servants in the department who have provided many valuable briefings and documentation which manages to explain complex matters. Amidst the debate it is very comforting to know that there are people in the department who are always available to provide information. Sometimes that will be at strange times of the night as, if I remember correctly, when working with the community affairs committee. Nonetheless, they provided the security that we had the information we needed. We welcome the fact that the private health insurers themselves have worked with both our government and the current government to put forward their case about how this indexation process will work. We support the legislation and we welcome it coming into place.