Health Fund Price Rises

Newcastle Herald

Saturday March 8, 2008

LEADER

AFTER years in opposition railing against the Coalition's tolerance of hefty annual increases in private health premiums, the new federal Labor Government has found itself having to do precisely the same.

When the health funds fronted up with their latest log of claims, Health Minister Nicola Roxon made a show of indignation and sent them back to sharpen their pencils. Some of them reduced their demands as a result. But despite the huffing and puffing, the private health industry has been granted permission to increase premiums by 4.99 per cent, well above inflation and even more than last year's increase.

It just goes to show that many things are not as simple as they might appear from the responsibility-free zone of the opposition benches.

Private health insurance is a major headache for governments. They want people to seek private care if that means the load on the directly funded public system is reduced. But Medicare has to fork out for much of the cost of care in the private system anyway, and governments live with the constant suspicion that they are being taken for a ride by private health care providers and their health fund paymasters.

The truth is that the private health system is just as riddled with entrenched inefficiencies and vested interests as its public counterpart. Medical specialist colleges, for example, are constantly accused of using closed-shop trade union techniques to restrict training positions and keep competition low, thus maintaining their members' stratospheric pay.

Many studies have suggested that overservicing and medifraud remains rife. Insurance status, rather than strictly clinical need, appears to be a major factor determining the allocation of many expensive procedures.

Consumers of many private medical services find accurate information with which to compare the cost and efficiency of providers is unobtainable or difficult to access, further suppressing competitive pressure and facilitating price and insurance premium increases.

While these and other flaws in the system remain unaddressed, private health insurance will continue to follow the familiar spiral pattern where price rapidly outpaces perceived value for money, leading to declining membership and periodic pleas for subsidies, rebates and other forms of corporate welfare.

Horses on show

HORSES will be a drawcard at the Upper Hunter Show today, another welcome sign that the equine influenza disaster has finally passed.

Since the disease hit the NSW horse population last August many traditional show events, rodeos and camp drafting were forced to a halt.

Last week the Government declared the state free from equine influenza, paving the way for the Upper Hunter to enjoy its show. Many who attend the event will have been affected by the epidemic and will be hoping the show marks the start of the road back to normality.

© 2008 Newcastle Herald

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