Medicare Surcharge

Newcastle Herald

Saturday September 27, 2008

leader

AUSTRALIAN Governments just can't seem to figure out what to do about private health insurance. The pendulum of assistance for the industry swings back and forth as different views prevail in political parties and the bureaucracy.

The Howard Coalition government backed private health to the hilt, introducing tax rebates to make fund membership more appealing, and applied a Medicare levy surcharge to higher income earners, penalising those people if they stayed outside the private system.

Labor moved quickly after its election to try to dismantle the surcharge, arguing in part that the lack of indexation of the surcharge cut-in point meant it was no longer just the well-off who were being hit for extra Medicare payments.

The proposed cut-in point for single taxpayers was lifted from $50,000 to $100,000 and for couples from $100,000 to $150,000. This was instantly opposed by the health funds which benefit from the levy. They argued that several hundred thousand people would respond to being freed from the surcharge obligation by dumping their private health insurance. This would lead to premium increases for those remaining, as well as a rise in demand for already strained public health services.

Australians have a love-hate relationship with the private health industry. It is perceived as wasteful, overpriced, riddled with overservicing and skewed to the advantage of richly rewarded health professionals who jealously guard their incomes. On the other hand, private insurance is seen as a "get out of jail free" card in the rare event of some serious health problems, relieving fund members from the stresses and burdens of queuing for care in the crowded public system.

Both views contain some truth. Private health may or may not represent fair value for money, but it undeniably keeps some pressure off public health services. For that reason, proposals that may undermine private health need to be considered with great care unless they are matched by proposals to pour extra resources into the public system.

Family First Senator Steve Fielding has been harshly criticised by some for blocking the Government's changes this week but his actions are not necessarily as irrational as they have been portrayed. A revised bill, with a compromise surcharge cut-in point of $75,000 for single taxpayers, is set to be considered by the Senate. Assuming the compromise is accepted, the Government may yet find itself thankful to Senator Fielding for putting the brakes on its early enthusiasm.

Remember Big Harry

SOME called it "Big Harry's Place". Others reckoned the acronym stood for "Bloody Hard People" (or something similar).

Whatever they called it, BHP's mighty Newcastle steelworks was the beating heart of the city's heavy industry and life without it seemed unthinkable.

It's been gone for nine years now, and the city has moved on.

At today's annual reunion former steelworks employees will remember Big Harry, warts and all.

© 2008 Newcastle Herald

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