Senate shelves over-65s health insurance Rebate cut

Controversial changes to the Private Health Insurance Rebate face an uncertain future, after the Senate voted to remove the legislation from its notice paper. However Minister for Health Mark Butler has reintroduced the bill.  

The government had proposed changing the structure of the Rebate so that people on low incomes would receive the same premium reduction regardless of age. The changes would increase policy costs by around 5% to 6% for those aged 65–69, and up to 12% for those 70 and over – saving the government $3 billion over 3 years, which it had pledged to spend on aged care services.  

The Coalition, Greens and crossbenchers voted to discharge the bill from the Senate agenda due to concerns about the impact on older Australians. Minister for Health Mark Butler responded by reintroducing the legislation yesterday.

“[This] flies in the face of what I thought was a clear understanding across the parliament of the need to fund better aged care services,” he said  

While the government had estimated around 44,000 older people might cancel their cover if the legislation passed, information obtained by the ABC this week found that number could reach 78,000 over time. 

Despite industry concerns the changes would cause a mass cancellation of cover, data from healthslips.com.au found that many older Australians could maintain suitable cover at a similar price point – even if the Rebate changes go ahead – by proactively reviewing their cover.  

Pricing on open Silver Plus policies (including cover for joint replacements and cataracts; key priorities for seniors) for a single in NSW ranged from $223 to $294 per month before the Rebate, healthslips.com.au data found. This shows some people could save up to 24% by reviewing their cover – more than offsetting the potential 12% impact of the Rebate changes. 

Trudie McConnochie

Writer and Researcher

Knowledge is power – that’s the guiding principle behind everything Trudie writes, and it’s a philosophy she brings to her work at healthslips.com.au. By breaking down complex information into easy-to-understand blogs and stories, she aims to empower Australians to make the best choices and an informed decision around private health insurance.

Trudie understands firsthand some of the complexity of private health insurance having moved to Australia from New Zealand and having to navigate a vastly different public healthcare system and health insurance structure.

Trudie holds a Bachelor of Communication Studies (journalism major) from the Auckland University of Technology.

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