Medicare Levy Surcharge Compromise Welcomed by Private Hospitals

16 October 2008

The Australian Private Hospitals Association (APHA) welcomes today’s compromise by the Federal Health Minister Nicola Roxon and Independent Senator Xenophon that reduces the proposed increases in the Medicare Levy Surcharge (MLS) thresholds.

“This compromise agreement is an improvement on the Government’s original proposals of $100,000 for individuals and $150,000 for couples which were too harsh,” said Michael Roff, CEO of APHA. “This announcement today at least provides some certainty to the private health sector.”

“APHA believes that as many Australians as possible should be encouraged to take out private health insurance and the MLS is a key element of a suite of policies designed to meet this aim.”

“While today’s compromise is not ideal, it should be noted that the MLS in its amended form will remain in place along with the health insurance rebates and lifetime health cover.”

Based on Treasury modelling, it has been suggested that 492,000 people could drop out of private health insurance and some believe most of these will be the young and healthy. APHA encourages anyone who falls under these new thresholds and currently holds private health insurance to think twice before dropping their health cover.

“Young and healthy people still have babies, suffer injuries and accidents that require surgery, contract cancer and suffer from mental illness”, said Michael Roff. “Private health insurance gives peace of mind that they will have fast access to high quality services in private hospitals if the unforeseen happens. I am hopeful that the drop-out rate from private health insurance will not be as great as predicted.”

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For further information, contact:
Lisa Ramshaw, APHA Public Affairs Manager, on 0413 971 999