26 October 2011

Health insurance still too expensive, says new report

Older Australians want private health insurance but for many it’s still out of reach, a new study has found.

The report A Carrot and a Big Stick: Understanding Private Health Insurance and Older Australians was conducted by the National Seniors Productive Ageing Centre (NSPAC) using data from the Australian Bureau of Statistics and the Private Health Insurance Administration Council.

The study showed that despite the proportion of over 50s covered by private health insurance rising from 40% in 1998 to about 52% today, nearly two thirds of those without insurance said they could simply not afford it.

Affordability is the key reason people of any age do not purchase health insurance, the researchers found.

About 59% of those under 50 and about 65% aged 50-79 cite ‘cannot afford it/too expensive’ as the reason for not purchasing health insurance.

The report also said almost 180,000 Australians aged 50 and over are paying a Lifetime Health Cover surcharge on their health insurance policy of between 40% and 70% with many more subject to a lesser surcharge.

National Seniors Australia chief executive Michael O’Neill said it was vital that seniors had access to affordable health insurance.

“If they cannot afford private health insurance, they may delay much-needed visits to the specialist or face long waits for elective surgery in public hospitals,” he said.

But for more than half, peace of mind was still worth paying for, with 57% saying ‘security and protection’ were the main reasons they bought health insurance.

The next most compelling reason was choice of doctor with 36%, followed by treatment as a private patient in hospital 34% and a shorter wait for treatment or concern over public hospital waiting lists on 33%.

There were also socio-economic reasons for not taking up health insurance, the report found. People were less likely to have health insurance if they were on the age pension, if they were from a non-English speaking background or had lower levels of education.

Michael O’Neill is available for interview.

Media contact: Rosemary Desmond 3233 9106

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With a quarter of a million members Australia-wide, National Seniors is the consumer lobby for the over 50s. It is the fourth largest organisation of its type in the world.