Private Health Funds Seen As Way Out Of Surcharge
Sydney Morning Herald
Tuesday July 1, 1997
High income earners had rushed to avoid paying a 1 per cent income tax surcharge by taking up cheap private health insurance policies with big excesses, NSW's biggest fund, MBF, said yesterday.
The statement came as the Minister for Health, Dr Wooldridge, warned that it was "a fact of life" that there were long waiting times for some elective surgical procedures in public hospitals which could "affect your quality of life".
Launching a $3.2 million advertising campaign for private insurance, Dr Wooldridge said the most compelling reason for being privately insured was that "you and your family will not have to wait in a public hospital queue for a lot of elective treatments".
Under the Government's scheme, which came into effect yesterday, low income earners will get up to $450 per family each year towards their private health insurance, while high income earners will pay a 1 per cent Medicare levy surcharge if they are not insured.
MBF's public affairs manager, Mr David Jones, said the fund had received a deluge of almost 6,000 calls in the past seven working days, 70 per cent of whom had been high income earners wanting to avoid the 1 per cent surcharge.
The "vast majority" of these callers had asked about the cheaper hospital insurance policies, which require patients to pay an excess of as much as $1,000 towards their costs, he said.
Overall, more than 40 per cent of those calling MBF had immediately taken up policies of one kind or another.
Medibank Private said its hotline had received 7,000 calls last week, with 38 per cent joining immediately and another 23 per cent requesting information packages. The fund did not know how many were high income earners wanting to avoid the surcharge. However, it said about 250,000 singles and families had applied for the rebates.
National Mutual said more than 140,000 members had registered for the rebates, accounting for about 40 per cent of the fund's membership base.
The Opposition health spokesman, Mr Michael Lee, criticised the Government for spending $4 million over two years on advertising, saying it would pay for treatment for 1,000 extra patients.
Mr Lee said the TV advertisements were "a disgrace" which undermined confidence in the public hospital system.
The advertisements show families travelling on a freeway on hospital trolleys and veering off a side road marked "private insurance" to avoid a traffic jam.
"The public hospital system is the most important part of our health system," Mr Lee said. "Dr Wooldridge's responsibility is to fix the problems, not to exaggerate them."
© 1997 Sydney Morning Herald
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