Rising health costs need to be addressed: seniors


19 December 2018

The Federal Government’s early announcement today of a 3.25% rise in health insurance premiums from 1 April next year underscores the need for an overall review of spiralling health costs, according to National Seniors Australia.

CEO and Research Director Professor John McCallum said seniors would welcome the relatively ‘restrained’ increase in health premiums in 2019, which had risen 32.8% over the past six years.

National Seniors was maintaining its call on the government to freeze private health insurance premiums to no more than CPI. With overall inflation at 1.9%, and health costs rising 3.2%, it was clear there was a long way to go to bring them under control.

“The Government might say they’ve delivered the lowest annual premium change in 18 years but there are still inherent problems with the health system that need to be addressed,” Prof. McCallum said.

National Seniors members had identified the affordability of private health insurance and the high cost of specialist fees as the issues of most concern to them in a survey late last year.

“It’s obvious there are inefficiencies in the health system, with out-of-pocket expenses increasing by three times the inflation rate over the past decade,” Prof. McCallum said.

“Medicare statistics show 86 per cent of anaesthetics and 53 per cent of operations cost more than the schedule fee.

“The Federal Government must address the issue of affordability for older consumers, many of whom had paid contributions for decades. People who have worked hard all their lives cannot afford to pay health insurance premiums, or get the cover they need, when they most need it, for operations such as a hip or knee replacements.

“What we’ve been saying for years still holds true: despite ever increasing premiums, when seniors come to make a claim for a service it’s either excluded or the out-of-pocket expenses have skyrocketed.”

Prof. McCallum said the current system of government-approved premium setting lacked transparency and improving competition in the private health insurance sector was needed urgently.

Private health funds made $1.86 billion in before-tax profit in the year to September 2018.

“These are taxpayer-subsidised businesses and we question the appropriateness of this level of profits.”

National Seniors CEO Professor John McCallum is available for comment.

Media contact: Lynda Schekoske 0488 047 380 or 07 3233 9134.


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