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Green light from Committee for Gold, Silver, Bronze, and Basic

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The Federal Government’s proposed private health insurance policy reforms look set to become law this year after a Senate Committee recommended passing the Bills.

The Committee investigating the new Gold, Silver, Bronze, and Basic policy proposals made just one recommendation when it reported in the first sitting week of the Spring session of Parliament – “that the Senate pass the Bills”. 

Committee Chair, Liberal Senator Slade Brockman, said that the Committee recognised that some people still had concerns about the policy categories, and the rules that will implement the product reforms.

“Some submitters disagreed with the inclusion of a Basic policy,” Senator Brockman said.

“CHOICE, the Australian Medical Association, the Australian Private Hospitals Association, and Day Hospitals Australia objected to the category on the basis that these policies provide low value cover to consumers, and exist to take advantage of the financial incentives provided by Government.

“Submitters also expressed concerns that, if the draft rules were adopted, particular products or services may only be available in high product tiers. For example … the AMA considered that, as 50 per cent of pregnancies are unplanned, pregnancy should be covered in Bronze rather than Gold.”

Senator Brockman said that the Committee understands that private health insurance can be a complex product that is confusing to many people.

AMA President, Dr Tony Bartone, appeared before the Committee in August, and told it that even doctors were confused by the array of choices and policies on offer.

“It is for that reason that we support the concept of developing Gold, Silver, and Bronze insurance categories,” Dr Bartone told the inquiry.

“Doctors are intelligent people. But I can tell you that we are all bewildered by the many different definitions, the carve-outs and exclusions from some 70,000 policy variations.

“That’s not my figure – it’s the Government’s. It’s unbelievable. No wonder we’re always being caught out.”

The Committee called for a public information campaign to help consumers understand the product design reforms, saying that would allow more consumers to be better informed about the different tiers and their inclusions.

Greens Senators Richard di Natale and Rachel Siewert lodged a dissenting report, arguing that the reforms would have little effect in improving the sustainability of the market.

“What we are instead seeing is an ideological commitment to throw good money after bad,” they said.

“The private health system operates only through the generosity of vast public subsidies of more than $6.5 billion each year. There is no argument that, without these subsidies, the market would collapse.”

Labor Senators Lisa Singh and Murray Watt also raised concerns that the reforms could have unintended consequences, including making it easier for insurers to cancel policies and harder for Australians to afford care when they need it.

“Labor Senators therefore support calls by the Australian Medical Association, Australian Healthcare and Hospitals Association, and others for the measures in this Bill to be reviewed after implementation,” they said.

They endorsed the main report’s recommendation to pass the Bills, ensuring their passage through the Senate.

The Government is expected to move to finalise the legislation in the Spring session.

The Committee report is available at https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Community_Affairs/PrivateHealthInsur2018.

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