Rudd 'breaking promise' on health rebate

8 May 2009, 12:48 pm   -   Source: AAP
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The opposition insists Labor's plan to slash private health rebates will affect all Australians, including battlers, by pushing up premiums.

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The federal coalition insists Labor's plan to slash private health rebates will affect all Australians, including battlers, by pushing up premiums.

Not wanting to focus on the few dollars a week that middle and high-incomers will lose, the coalition has instead emphasised the broader consequences of the government's plan, which will break an election promise.

"If you cut into the private health insurance rebate, what you will do is put increased pressure on the premiums for lower-income people that cling to their private health insurance," former Liberal leader Brendan Nelson told ABC TV.

Opposition health spokesman Peter Dutton was singing from the same song sheet today.

All 11 million Australians with private health insurance could expect to pay more for their premiums as a result of the change, he told ABC Radio.

"If hundreds of thousands of people are driven out of private health insurance by the Rudd government, that will make it more expensive for those who remain on private health insurance."

The reduced rebates would force "hundreds of thousands of people" onto the public system, making waiting lists even longer.

The government aims to save $1.9 billion by slashing the 30 per cent private health rebate for middle- and high-income earners in Tuesday's budget, it has been reported.

Prime Minister Kevin Rudd and Treasurer Wayne Swan have refused to confirm reports that the  rebates are expected to fall away on a sliding scale for individuals earning more than $74,000 a year and couples on more than $150,000 a year, and cut out altogether at $120,000 for singles and $240,000 for couples.

At the same time as the incentive to take out private insurance is reduced, the penalty for not doing so will increase.

Changes to Medicare levy surcharge expected

It had also been reported the government plans to boost the Medicare levy surcharge for well-off taxpayers by up to 50 per cent.

The Public Health Association of Australia welcomes the shift away from the previous Howard government's so-called middle-class welfare.

Health is socially determined, so money should be redirected from the well-off to the public system, chief executive Michael Moore said.

"The wealthier you are, the healthier you are," he told ABC Radio, adding lowering the rebates would have a very minor impact, if any at all, on those affected.

While it was possible some people might drop out of private health care as a result, they'd generally be wealthy enough to find their way in the public system and self-fund the "odd operation".

"We're going down the right path." Federal Treasurer Wayne Swan has refused to confirm Labor will cut the rebates next week.

But he did say the government had some "hard choices" to make in order to maintain jobs and build vital infrastructure, while providing long-term savings.

Prime Minister Kevin Rudd was willing to confirm tax cuts promised for the coming financial year will go ahead.

"We have indicated quite some time ago that we believe that it is important to proceed with legislated tax cuts," he said, adding they were necessary to provide families with support through difficult times.

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