Coalition's plan to ensure private health insurance delivers value for money

 

A re-elected Turnbull Coalition Government will improve the value for money Australians receive from their private health insurance and ensure they can easily shop around for a more-affordable deal.

We will do this by ensuring Australians can access standard levels of cover that is explained in plain English and protects patients against junk policies and fine print.

Around 12 million Australians have private health insurance – that’s half the population.

Unlike Labor and the Greens, the Coalition understands that private health insurance is a fundamental element of our health system that offers consumers greater choice over their care whilst taking pressure off Medicare and public hospitals so that their universality remains sustainable.

However, we also understand consumers are frustrated with the complexity of the current system, with over 40,000 private health insurance products currently on the market.

We also know that Australians are still angry over Labor and the Greens’ $4 billion cuts to private health insurance, which pushed up the cost of some policies by 30 per cent overnight:

“Every promise I made I paid for. How did I pay for it? I paid for it by targeting private health insurance.”

- Labor Deputy Leader and former Health Minister Tanya Plibersek – 4 April 2016 – Press Conference

It’s therefore not surprising more-than two thirds of the 40,000 Australians who responded to the Coalition’s private health insurance consumer survey believed they were not currently getting value for money from their policy.

Seventy per cent of respondents said they considered making changes to their private health insurance policy in the last 12 months, however many found it too difficult.

This is evidenced by the fact nearly half of all respondents said their inability to understand and properly compare policies was in their top three concerns, while one in three were left to guess what their out-of-pocket cost would be before a medical procedure.

This is not good enough. The Coalition is listening.

A re-elected Turnbull Coalition Government will therefore not just maintain the current private health insurance rebate for patients, but make clear improvements to ensure its helping to deliver consumers value for money:

  • Simplify private health insurance by developing easily-understood categories of health policies – eg. labelled gold, silver, bronze – so that consumers know what they are, and are not, covered for.
  • Weed out junk policies by ensuring consumers have access to a product with a mandated minimum level of cover.
  • Develop standard definitions for medical procedures across all insurers so that consumers can compare policies more easily.
  • Simplify billing so that consumers can receive a single bill covering all costs of a medical procedure – such as the surgeon and anaesthetist – to avoid unplanned bill shock.
  • Ensure that insurers use plain English and disclose policy information in a consumer-friendly way.
  • Make fine print and commissions more transparent.
  • Maintain community rating.
  • Address regulatory issues that are adding to the cost of premiums and discouraging innovation.
  • Work with industry to develop products to meet the specific needs of Australians living in rural and remote Australia.
  • Ensure the current gateway www.privatehealth.gov.au reflects these improvements and allows consumers to more easily compare policies and access information.

Making it easier for consumers to shop around will increase competition in the private health sector and, in turn, improve value for money and affordability for consumers.

The Turnbull Coalition’s expert Private Health Ministerial Advisory Committee – announced in our 2016-17 Budget – will include consumer representation and will be tasked with beginning work on implementing these policies immediately after the election if we are re-elected.

This will also complement other regulatory reforms to improve affordability for consumers and cut red tape, such as our already-announced revamp of the current Prostheses Listing Advisory Committee to make medical devices more affordable and available to Australians faster, without compromising safety.

This is in stark contrast to Labor, with Bill Shorten refusing to rule out further cuts to the value of the private health insurance rebate.

It’s time Bill Shorten came clean about whether Labor will be again targeting patients private health insurance rebate to fill their election black hole.