$1 Fee For Crisis Health Cover Could Cost More
Sydney Morning Herald
Thursday May 8, 2003
The Howard Government's $1 a week insurance cover for catastrophic doctors' bills will depend on millions of Australians signing on who will never need it, according to a leading health insurance actuary.
Brent Walker , who has advised governments on health insurance for many years, said: ``If the product is marketed in a way that only the likely user will take it up, then the premium will have to be many times higher . . . over $5 [a week]."
According to a Health Department estimate, only about 30,000 people without health-care cards run up out-of-pocket doctor costs exceeding $1000 a year, the point at which health funds would pick up all extra costs under the proposed Medicare changes.
``The $1 figure appears to be based on the grounds that the health funds will successfully sell the product to a much larger number of contributors, nearly all of whom won't claim," Mr Walker said. ``If the funds do that, they are going to have to use subtle marketing methods such as linking it with other popular products."
The expansion of private insurance to cover medical treatment outside hospital is a crucial element of the Government's Medicare shake-up. The Opposition says it will undermine the universal foundations of the scheme.
Yesterday the Health Minister, Kay Patterson, blamed Opposition ``lies" for a negative and confused public response to its proposed reforms, revealed in a Herald-ACNielsen poll published yesterday.
The poll found that 40 per cent said they would be worse off, and 49 per cent said they did not know how the changes would affect them or that they would not make a difference.
Yesterday, a poll published in Australian Doctor found 58 per cent of general practitioners said they would be unlikely to take up the Medicare package, which offers incentives to bulk-bill pensioners, but which will make it easier for doctors to charge other patients more.
Senator Patterson's spokesman said the suggestion that premiums for the new insurance product might cost more than $1 was ``pure speculation" and contrary to the actuarial estimates of the Health Insurance Commission.
The extension of private cover to non-hospital doctors is a significant part of the changes but important elements are yet to be decided, according to a circular issued by the Health Department this week.
The document says consideration is still being given to whether the policy will be subject to the age-based premium penalties imposed on over-30s who take out hospital insurance, whether funds will be able to exclude some medical services and whether waiting periods will apply.
The chief executive of the Australian Health Insurance Association, Russell Schneider, said he expected well over half of existing members would take out the special cover and the premium could end up costing less than a $1 a week.
``Funds would be encouraging people to take out the product on the basis that no one can predict their state of health from day to day . . . I don't think it's a case of conning anyone," Mr Schneider said.
The president of the Australian Medical Association, Dr Kerryn Phelps, told the National Press Club yesterday that the erosion of GP incomes meant governments could no longer get away with the ``greedy doctor" argument in debate over health-care costs.
© 2003 Sydney Morning Herald