Increase In Medicare Levy Misses The Point Self Insured To Get 1% Slap In The Face

“The Federal Government should ask why people are reluctant to join or stay in private health funds before it slugs those on higher incomes (over $50K gross) with a 1% increase in the Medicare Levy,” spokesperson for the Australian Doctors’ Fund, Mr Stephen Milgate, said in Sydney today.

“A recent report by Mr Roger Kilham of Access Economics, is critical of the level of competition, the oligopoly nature, the management costs and lack of innovation of private health funds,” Mr Milgate said.

“The fact that of the almost 70% of Australians who do not have private health insurance, a not inconsiderable number, believe that it does not meet their long-term health financing needs has been totally overlooked.

“An increase in the Medicare Levy by 1% for those on $50,000 or more would be a slap in the face for the self insured and substitute health insurers.”

“It is not true to say all Australians on higher incomes who are not in health funds are necessarily relying on Medicare. A substantial number of Australians chose to use the private sector and pay their own health bills out of their own pockets.

“Some doctors report that as many as 20% of their patients are self insured.”

It is estimated that some 300,000 Australians carry life insurance products such as trauma insurance or crisis cover that they consider are substitutes in full or part to private health fund membership.

At the moment there is a 20 cents in the dollar rebate for people who spend more than $1,000 out of their own pocket on medical bills. (The rebate does not apply to expenditure on health insurance of any kind.) The speculation is that the rebate will only commence after an out-of- pocket level of $1,500 is paid which is around the average cost of a deductible private health fund contribution, making it harder for those who pay out of their own pocket to get a rebate.

“Australians who pay their own health care are entitled to ask why they are to be slugged with a higher Medicare Levy.”

“The Government must widen its incentive to include those products which Australians may prefer as substitutes or part substitutes to traditional health fund cover,” Mr Milgate said.

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