What is your title, in Julius media core 579?

This rebate was allegedly introduced to "take the pressure off the Public System".

Does anybody have any evidence that it has actually succeeded?

I would also be interested to see the annual profit statements for the private health funds nationally plus the total amount of taxpayer subsidy they receive. I have heard some interesting comparisons but am yet to locate a reliable source.

The various "sticks and carrots" associated with getting people into Private Health Insurance should be viewed as a whole, in order to get the full picture.

Underlying the whole deal is the basic question, "do we want a Private Health Insurance system here in Australia".

We appear to have reached the conclusion (with a few standouts) that yes, it is a good thing to supplement the funding of our health system through voluntary contributions made by individuals and families. This is a fairly intelligent and pragmatic approach: at the macro level, the system gets insurance premiums as well as taxpayers money, and the consumer gets greater choice.

But governments have a problem in balancing this out. Contributors to PHI have already paid their taxes - should they not get a little tax relief on their premium expenses? And the answer seems to be, within reason, yes.

There's another level of thought that says hey, if you are sufficiently well-off, you bloody well should pay your own way a bit more - hence the "stick" in the form of the Medicare Levy Surcharge. If you earn over a certain amount, and you don't have PHI, you get whacked for an additional 1% on your tax bill.

Means testing the rebate seems, on the whole, pretty fair to me. What seems out of balance is the second part - why there is a penalty, in the form of the MLS. Yes, we want you to join a Health Fund, but no, we're not prepared to give you a tax break, but yes, we will penalize you if you don't.

If the government wants Private Health Insurance to continue to pour tons of money into the health system as a whole - around $10 billion a year - it needs to be reasonably attractive. Taking away the carrot - unqualified access to a 30% rebate on premiums - should surely be accompanied by a removal of the stick.

Logically, that is.

But since when has logic influenced political decisions...

The first thing to confirm is that Labor prior to the 2007 election made an "iron clad" promise not to alter the private health rebate. This was never presented as "an objective" or "an aspiration" but as a promise.

This new legislation is based on a lie. (again)

Secondly the whole phrase "middle class welfare" is a term spawned by those that object to any incentive or rebate given to those of above average earnings, irrespective of whether this improves the welfare of Australians generally far beyond the value of the rebate.

The whole premise of the rebate was that by encouraging people to make use of private medical resources, the public resources could be used to provide better cover for less people. The independent estimate was that for every dollar of subsidy, there would be essentially 2 dollars freed for the public system. The Deloitte's report confirms this.

It is simply bad policy to reduce this rebate. The fact that it was based on a lie just makes it worse.

How can you tell when Gillard is lying - her lips are moving. She just got caught out with her preparations 2 weeks ahead to knife Rudd.

I think you are missing the point, Shadow Minister.

>>The first thing to confirm is that Labor... made an "iron clad" promise<<

I know how much you enjoy poking fun at Labour's policy tap-dancing. But in this case, it might be a good thing to look just as closely at the Coalition's position.

"The first thing to confirm" might be whether there is any suggestion that they might repeal the legislation when they return to office.

So far, so silent. Interesting.

The second might be to look at their arguments.

http://www.joshfrydenberg.com.au/guest/SpeechesDetails.aspx?id=125

One has to assume, I guess, that Frydenberg's statements accurately reflect Coalition policy. If they do, it's all a bit Swiss-cheesy.

Leaving aside the knee-jerk "she said she wouldn't, so she's a fibber" stuff at the beginning, what are the key points.

"Means testing the rebate will drive up premiums, force millions of Australians to downgrade their private health care with many abandoning it all together and increase the pressure on an already stretched public health system."

Those are just sound-bites. Unsupported hypotheses masquerading as fact. The entire argument relying upon its "millions forced out" starting point.

Which is debatable at a number of levels, but most obviously at the "why would someone who could afford it, give it up, when they will be whacked with the MLS anyway?" level.

It gets even flimsier. He even spikes his own guns, at one point.

After giving the now-mandatory Thatcherite speech on self-reliance, he points out that

"...a remarkable 5.6 million people with private health insurance have an annual household income of less than $50,000 and 3.4 million Australians with private health insurance have an annual household income of less than $35,000."

Ummm. These are exactly the folk who won't be affected by the rebate removal.

There's a whole lot more guff about personal choice, which, of course, remains entirely unaffected by the changes. You can still choose to take out insurance. No-one is stopping you.

It's pretty much like private education, which is also a choice. But one that folk are happy to accept, is an after-tax choice.

Pericles,

The biggest risk identified was that about 4.6 million will downgrade their insurance.

For example presently I can pay $160 p.m. for my family and get the basic health cover that will mean that I don't pay the penalty, and which covers stuff like basic dental and eye care, that I would probably take anyway. Instead I have a premium cover of nearly $300 p.m. that covers a lot of expensive treatments that are presently fully covered by Medicare, but through private insurance I can get faster treatment with private doctors.

I can easily drop my health cover and pay less and rely on the public health system for future hip replacements etc. This is where the money will be sucked out of the private health system, the premiums will go up, and the burden on the public system will increase.

Labor is deliberately lying if it thinks it will make no difference to the average man on the street.