Cutting a rebate for Australians aged over 65 who take out private health insurance is a "cost-shift pure and simple" that will add to the pressure on ACT public hospitals, the Canberra Liberals say.
Opposition Leader Mark Parton has joined with the Liberals' ACT Senate candidate, Nick Tyrrell, to call on the federal government to abandon the proposal and consult with states and territories over the potential impact to their health systems.
"The ACT already has one of the highest private health insurance rates in the country at 54.2 per cent. Pulling the rebate from older Australians risks pushing more patients into our already stretched public hospitals," said Mr Parton, who is also the Liberals' health spokesman.
But the federal government says the change will save $3 billion over four years and that money will be invested in expanding aged-care services.
Mr Parton wrote to the federal Health Minister, Mark Butler, on August 20, urging him to reconsider the policy before its proposed start in April 2027.
Health ministers in NSW, Queensland and Tasmania have said the federal government's proposed rebate cut would further strain their health systems.
Asked if ACT Health Minister Marisa Paterson shared the concerns, an ACT government spokesman said the territory was working to ensure older Canberrans could access high-quality care regardless of their private health insurance status.
"A strong private health system is an important part of Australia's healthcare landscape, providing access to high-quality services that complement public hospital care in the ACT," the spokesman said.
"While the ACT has relatively high levels of private health insurance coverage, many people with private health insurance continue to choose public hospital services as public patients.
"That is why the ACT government is investing in the capacity and capability of public hospitals to deliver timely, safe and sustainable care."
Mr Butler has previously told Federal Parliament the average impact of cutting the rebate would be between $220 and $250 a year.
"The impact of this will be to return to the original design of the private health insurance rebate when it was introduced by John Howard, which is not to have a different level of subsidy paid to households on the same income simply because of their age," he said on August 13.
People aged 65 to 69 presently get back about 28 per cent of their private insurance premiums and over 70s get 32 per cent.
The government's proposed change means everyone who meets the income test would receive the same rebate of roughly 24 per cent.
On Friday, Mr Butler said he was not in a position to maintain a subsidy that was paid at different rates depending on age when the Commonwealth needed to fund new aged-care services.
"Now, I could have put it on the debt, but people don't want us to do that either. We've had to make hard choices in this budget. I wish I didn't have to, but this is one of them," Mr Butler told ABC radio in Adelaide.
Mr Butler said government modelling showed about 40,000 people out of the millions insured would cancel their private health insurance and additional University of Melbourne modelling showed the 40,000 figure was at the high end of estimates.
"They think fewer people will do that because frankly older Australians get a lot out of their insurance. They use it more than they pay for it, if you like," he said.
The Canberra Liberals want the federal government to publish the government modelling and conduct a further analysis of the impact of reduced private health insurance coverage would have on public hospital demand.
Mr Tyrrell said: "Canberrans deserve better than federal Labor running roughshod over the territory and heaping extra pressure onto our local public hospitals. We need full transparency on the modelling and genuine consultation with the ACT before this change proceeds."
