They examined how the incentive of the private health insurance rebate, and the penalty at tax time for high-income earners without insurance (the Medicare Levy Surcharge), affects uptake.<\/p>\n
Associate Prof Kevin Staub, a co-author of the paper, said both have little impact on private health insurance participation. Private health insurance<\/a> uptake is driven by health needs and habit, he said, with many maintaining insurance because they have always had it.<\/p>\n Giving those 65 and over a higher rebate means \u201cthe government is spending a lot of money to keep people in health insurance who wouldn\u2019t actually drop it without the incentive\u201d, he said.<\/p>\n Sign up for the Breaking News Australia email<\/a><\/p>\n The research estimates 14,821 to 42,498 older Australians will drop their cover as a result of the policy, or 0.1% to 0.4% of the total insured population. This is roughly in line with the government modelling which estimates 44,000 people will drop their cover following the change.<\/p>\n Staub and his colleague Prof Yuting Zhang found that by stopping the extra rebate for older Australians, the government would save about $730m to $940m a year by 2028-29.<\/p>\n \u201cI think that, overall, this is a good policy change,\u201d Staub said.<\/p>\n The health minister, Mark Butler<\/a>, told ABC Radio Perth on Tuesday the savings would be directed towards aged care.<\/p>\n He rejected comments from the Australian Private Hospitals Association and the Australian Medical Association (AMA) that the changes would lead to a further strained public hospital system.<\/p>\n \u201cWe don\u2019t think there will be a material impact on public hospital activity,\u201d he said.<\/p>\n The health economist and senior postdoctoral research fellow with the Australia Institute, Luke Slawomirski, described the University of Melbourne paper as \u201cempirical analysis from highly skilled, independent researchers\u201d.<\/p>\n Slawomirski co-authored a submission<\/a> from the Australia Institute to a Senate inquiry into the proposed changes, which is due to report its findings in October.<\/p>\n
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