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Government cost cutting must not be borne by most vulnerable : Comments
By Ray Cleary, published 30/1/2008Rising inflation and the pressure to significantly cut spending mean the Rudd Government is facing its first major challenge since taking office.
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You're calculations don't take into account that the costs of providing the public standard of health care are much less than that of private. The private health expenditure total is about twice that of the public expenditure, but with a third less people. This results in an average cost ratio of 3:1.
Thus $19 Billion in private health cost would be covered by about $7 billion in the public system. Or essentially, the 30% health rebate could pay for the public care of about 50% of those on private health cover. The statistics I've seen suggest less than a third of current private health subscribers made the jump after the introduction of the rebate.
This means that overall its a welfare program that costs the government money and mostly helps those wealthy enough to help themselves. It's classic Howard middle (and upper!) class welfare taking away resources from the public system. If it was means tested to target only those where it may make a difference then it could be an overall money saving program.