Station: Sky News Live
Program: Live Now
Date: 2/4/2018
Time: 9:35 AM
Compere: Samantha Maiden
Interviewee: Catherine King, Shadow Minister for Health


SAMANTHA MAIDEN: Joining me now live to discuss this is the Shadow Health Minister Catherine King.

Good morning Catherine.

CATHERINE KING: Good morning Samantha.
SAMANTHA MAIDEN: Now, you’ve accused the Government of a cover-up in relation to these private health premiums. Can you just explain what’s been going on that you think consumers are not necessarily aware of?
CATHERINE KING: Well, there’s two things that’s been happening. Obviously, yesterday, private health insurance premiums went up yet again, and on average we’re going to be seeing Australian families paying $200 extra, and that’s about extra that they’ve been paying since the Abbott-Turnbull Government came to office. On our modelling, that means an extra $1 billion just this year alone that’s going to be coming out of the pockets of Australians in terms of their private health insurance premium increases, and that’s $1 billion that consumers won’t have to be able to do the things that they need to do: pay their mortgages, pay their utility bills.

The Government also last week, without any notice to either us or to the Australian public, informed people that there’s been an anomaly in the legislation for private health insurance since 2007 that means that some products that have been around since then are actually now no longer deemed private health insurance products. They’ve had excessive waiting periods of up to two years, and that’s actually now not allowed under the rules.

Our view, frankly, is that the Government basically put some legislation in, didn’t inform anybody about it, wrote to private health insurers to tell them about it, but certainly didn’t around 25,000 Australians that they may have had private health insurance that means that they’re not eligible for the rebate or tax concessions for the last 11 years. So that’s really what we were talking about yesterday with a cover-up by not coming clean and telling people what’s actually happening.

SAMANTHA MAIDEN: What’s happened to those 25,000 people? Do you think that- I mean, presumably they would know if they weren’t being awarded those tax benefits has been paying out on it regardless of the fact that they’re not actually approved products?
CATHERINE KING: So what the Government’s now said, so the Government’s introduced legislation to retrospectively say those people will be okay, but what potentially could have happened is- so, it hasn’t informed any of those people potentially they’ve actually been paid the rebate when they shouldn’t have. They’ve been eligible for the tax concession if they’ve been paying Medicare levy surcharge, not if they’ve been under the Medicare levy surcharge, so there’s potentially that they’ve got a tax liability. The Government’s introduced legislation to fix that, but we think, frankly, rather than just putting a legislation in, they should have at the very least informed people that there’s a problem. What was write to private health insurers and say you’ve got a problem; didn’t necessarily inform the Australian public about that, and now that’s obviously going to be subject to a parliamentary debate in the upcoming weeks of Parliament.
SAMANTHA MAIDEN: So, have these 25,000 consumers been informed now? Have they been bumped onto different private health insurance? How have the funds actually dealt with this problem?
CATHERINE KING: Well, we, of course, don’t know the way 25,000 – and it could be more, we understand that’s just from a figure in the newspaper – they haven’t been informed. The way that they were told, if they were reading the front page of The Australian, is they were informed by certainly not by their insurer, as far as we understand, and certainly not by the Australian Government. We don’t know if those products have now been changed for people, if people have been written to to say: look, we’ve had a product that has a two-year waiting list for you to get on to obstetric surgery, which means that product’s not viable under the private health insurance rules. We don’t know if they’ve been told or not, and again, the Government just seems to have tried to muddy the waters a bit, put some legislation in which hopefully will fix the problem, but not informed people about what’s actually happened, and left it to the media to tell people, basically.

[Unrelated items – discussion about premium increases]
SAMANTHA MAIDEN: Okay. The 30 per cent private health insurance rebate has become a complete sacred cow of this debate that nobody believes it can touch, despite the fact there’s solid evidence that in some cases it’s inflationary use of taxpayers’ expenditure with not necessarily a benefit in all cases. Are you saying that as part of this Productivity Commission review that the 30 per cent rebate is out of bounds?
CATHERINE KING: Certainly, in terms of the Productivity Commission, it will look at the impact of the rebate, that is to be a range of other factors such as what is the increase in health inflation, what’s happening in the private health market, particularly the number of private health beds that are available and the interaction with the entire system, what’s happening with private patients in public hospitals and the usage of private health insurance. So there’s a number of factors it will look at. But Labor absolutely understands, for many Australians, to keep private health insurance affordable, the rebate has been part of keeping rebates lower for Australian consumers. What we are saying to the private health insurance industry is that they are beneficiaries of an almost $6 billion rebate. It is time that they actually also came to the table very substantially and started to engage with government and with consumers to make sure we can keep this product affordable overall.
SAMANTHA MAIDEN: Alright, but just so I’m clear, if the Productivity Commission comes back and says the 30 per cent rebate is a flawed policy, it’s not working, are you going to keep it, regardless of what the Productivity Commission says, or is the door open to changes around how the 30 per cent rebate operates?
CATHERINE KING: Well, let’s wait and see what the Productivity Commission has. I’m not going to engage in, now, before we’ve had a general election, before Labor, if we’re fortunate enough to form government, has given the terms of reference to the Productivity Commission. I’m not going to engage what we might or might not do, given that we don’t know what it’s going to say. Of course, it will …
SAMANTHA MAIDEN: [Interrupts] Okay. So just so I’m clear- I need to be clear. You’re not ruling out changes to the 30 per cent rebate then if that’s what the Productivity Commission advises?
CATHERINE KING: We will certainly look at what the Productivity Commission has to say across the gamut of private health insurance and the way in which the private health industry looks at. And of course that does mean that the rebate will be something that the Productivity Commission looks like, but Labor fully understands that the rebate has become a very important part of why people can continue to afford private health insurance. It’s become part of people’s budgets.

[Unrelated items – discussion about junk policies]
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