The number of people with private health cover – both hospital-only and hospital plus extras – fell from a peak of 47.4 per cent in June last year to just 47 per cent in June 2016.
It doesn’t sound that drastic. But that’s 2,958 less people contributing to the insurance pool with everyone else and 2,958 people who are now relying on our public system to pay their medical bills.
Over 13 million of us have private health cover, the majority over the age of 50, but according to Private Healthcare Australia, nearly half have an annual income of less than $50,000.
So how many of us can afford increasing premiums?
Costing an arm and a leg
Australians paid a huge $22 billion in premiums in the last financial year. Overall, premiums have risen by about 35 per cent since 2010, well above the inflation rate.
The latest rise approved by the Government in April was 5.59% – for the average family, that’s around an extra $200 a year. In the same period, household income grew by just 1.8%.
And we’re getting less ‘bang for our buck’ too, with payouts falling by 2.7 per cent in the last quarter to $1.2 billion.
In contrast, private health funds boosted their profit before tax by 8.9 per cent according to the Australian Prudential Regulation Authority.
Reforms on the way?
Private insurers blame health costs for the hikes and want changes to the Prostheses List – which set the prices for medical devices such as pacemakers and hip and knee replacements in 2006 – to save them $800 million a year.
They say this would see premiums cut by $150 and $300. If they don’t, it will be us who foots the bill.
“If health insurance membership drops to pre-2000 levels, Australian taxpayers would need to fund at least an extra 8% public hospital beds,” Private Healthcare Australia’s Chief Executive Officer Dr Rachel David says.
The Government announced a new Private Health Ministerial Advisory Committee last week, promising consumers “better value for money”.
The question is will it deliver?
Are you thinking about dumping your private health cover? Let us know in the comments below.
