Station: Radio National
Program: PM
Date: 19/05/2020
Time: 5:25 PM
Compere: Linda Mottram
Interviewees: Prue, Brisbane Resident; Dr Rachel David, CEO, Private Healthcare Australia; Dr Stephen Duckett, Grattan Institute


LINDA MOTTRAM: Well, young people are continuing their exodus from health insurance, new data shows. Some say the industry is in a death spiral, as people in their 20s and 30s, who are not prone to thinking about their mortality, drop their coverage while people over 50 are taking it up, increasing the industry’s risk profile. Also of note, the health funds think the current crisis has served to underline to young people that the public health system has got them covered, and they’d like to change that view.

Rachel Mealey reports.

REPORTER: Brisbane woman Prue (*) turned 25 yesterday and her coverage under her parents’ health insurance ran out. It’s time for her to decide if she’s going to take up cover herself or rely on the public system.
PRUE: So I am looking at a sort of mid-price. So, I think it’ll be around $150 a month.
REPORTER: The interior designer is in a safe job and thinks, for her, it’s the right decision.
PRUE: I think so. For my particular position, I think that it has come into use, say, with dental or physio or even like psychology, for example. Things like that, that you don’t have all the time but if they come up, then it’s better to have something that will cover it if you need it there.
REPORTER: Private health insurance statistics for the quarter were released today and it seems Prue is bucking the trend. They show that in the three months to March, young people dropped out of health insurance at a rate of around 100 a day.

Dr Stephen Duckett is the health program director at the Grattan Institute.

STEPHEN DUCKETT: These data are for the quarter ending 31 March, and so, that’s a bit early for COVID-19 issues to have an impact. I just think we’re just seeing- wages have been flat for so long. Premiums have been going up for so much that people are just finding it difficult. Even before COVID-19, people have been finding it difficult to meet household payments and they then look around for what they can give up and what they’ve been giving up is private health insurance.
REPORTER: Dr Duckett describes it as a death spiral for the industry. He says the current crisis has underlined a belief in young people that the public system will cover their health needs.
STEPHEN DUCKETT: It has been dramatic. So, all of the stories are about the public hospital system, will it cope and won’t it cope, and clearly, it has coped. The stories were also about: well, we don’t need private hospitals during this period so let’s put them on standby, put the private hospitals in hibernation, just so we can make sure the public hospitals are better able to cope. And then, the states negotiated deals with the private hospitals to say: well, we might need you to take patients from the public hospitals. And so, it’s just beginning to say: how does this industry fit together and how should it continue into the future.
REPORTER: Dr Rachel David is the CEO of Private Healthcare Australia, the group representing Australia’s health insurers.
RACHEL DAVID: I think all indications are that this is going to continue to be a trend into the future unless we can improve the affordability of the products by working with our providers to make surgery and mental health care in hospital more affordable.
REPORTER: Dr David says Australia has come through the pandemic in good shape because of the extra capacity that the private health system provides.
RACHEL DAVID: If we didn’t have that capacity and have the capacity to be flexible, to provide extra elective surgery and to provide extra capacity for intensive care and ventilators and to have extra doctors and nurses available, we could potentially have been under a lot of trouble had the pandemic taken hold. And I think the reason the community has so much confidence in our healthcare system is because it’s a mixed public and private system.
REPORTER: Do you think young people get that subtlety though, that messaging?
RACHEL DAVID: It’s something that we need to do better to articulate to young people, particularly as the economic effects of the pandemic is disproportionately affecting the younger generation.
LINDA MOTTRAM: CEO of Private Healthcare Australia, Dr Rachel David.

Rachel Mealey with that report.

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