Democrats Make Deal On Health Plan
The Age
Friday September 24, 1999
The Federal Government's latest attempt to boost private health insurance coverage is set to go ahead after a compromise deal was struck with the Australian Democrats.
The Government has agreed to a number of concessions on its Lifetime Health Cover to win the support of the Democrats in the Senate, including a review of the scheme in four years.
It has also agreed to:
* Make private health insurance products that have cheap premiums and carry large excess payments less attractive for high-income earners.
* Give refugees a grace period in which they can take out private health policies and avoid penalties.
* Protect public hospital funding if health insurance coverage rises above certain levels.
The concessions were revealed in letters from the office of the Health Minister, Dr Michael Wooldridge, to the Democrats tabled in Parliament yesterday.
The Opposition last night criticised the Democrats over the deal
The Labor health spokeswoman, Ms Jenny Macklin, said the Democrats were naive.
Lifetime Health Cover is a scheme designed to reward people who take out health insurance before turning 30. Under the program, people who delay taking out hospital cover will pay a 2per cent loading on top of the base hospital insurance premium for each year after 30.
However, people over 30 can take out private insurance without financial penalty before July 2000. The Government has agreed to publish brochures detailing the rights of patients in regard to gap payments.
A Labor Party proposal to give discounts to people under 30 who took out policies appears doomed with the Democrats signalling they would not support the idea.
Ms Macklin said the initiatives to make policies with large upfront deductibles less attractive, and to review the scheme after its early years of operation, were in response to amendments proposed by Labor.
``The Democrats were naive to accept three letters from the Government as a substitute for supporting some of the Opposition's amendments," she said.
Senator Lees said her party supported the principle of the bill. But she told Parliament: ``We believe that on its own, this is not the magic solution, that it is not going to substantially increase the number of people who are choosing to either purchase private health insurance or stay with an existing purchase."
A spokeswoman for Dr Wooldridge said the Government favored a minimum membership period for private health insurance of one year to complement Lifetime Health Cover. The minimum term would be a temporary measure but the period for which it would operate had not been decided.
© 1999 The Age