Walt Secord pushes for Medicare levy increase to bridge NSW health funding gap

Date
    November 2, 2015
    Sydney Morning Herald

NSW opposition health spokesman Walt Secord is calling for a doubling of the Medicare levy to help cover the multibillion dollar shortfall in health funding faced by NSW under cuts to Commonwealth payments in the federal government's 2014 budget.   

Mr Secord said a doubling of the Medicare levy to 4 per cent was a fairer solution than Premier Mike Baird's proposal for an increase in the GST to 15 per cent.

"Furthermore, it would raise more funds and would mean that those with the highest means would make the highest contribution," he said.

Mr Baird and NSW Treasurer Gladys Berejiklian have said they favour the GST increase to cover an estimated $35 billion national health funding shortfall by 2030.   

There would be no broadening of the GST base to include fresh food or education. Those earning below $100,000 would be compensated through income tax cuts and other payments.

Opposition Leader Luke Foley has previously rejected the proposal as "lazy" and said state governments should raise extra money by agreeing to set taxes at the same rate to eliminate the competition between them that erodes all their revenue bases.

The doubling of the Medicare rebate has been proposed by Victorian Premier Daniel Andrews. But NSW has rejected the option as it is an increase to income tax.

However, Mr Secord said doubling the Medicare levy to 4 per cent "would raise $29 billion of which more than $21 billion would remain after protections to lower incomes".

In a speech to the NSW Parliament last week he noted that the surcharge is not paid on a taxable income equal to or less than $20,896 or $33,044 for pensioners and it is only partly paid by those with a taxable income between $20,896 and $26,121 or $33,044 and $41,306, for pensioners.

"With our ageing population and the rising costs of health and hospitals, we need a funding model that responds to the real costs of healthcare in Australia," he said on Sunday.

"Increasing the GST is a very unfair model and it is a more regressive form of taxation as it has a higher marginal effect on lower income earners than it does on higher income earners.   

"Unfortunately, the increase of the GST would hit Australian families the hardest. The fairest approach is to increase the Medicare levy."

Redmond Neck wrote on Nov 2^nd, 2015 at 6:53am:


Wouldn't people pull out of private cover?

It would hardly be worth it for them and that would put a strain on an already burdened public health system.

Redmond Neck wrote on Nov 2^nd, 2015 at 6:53am:


fixed

Ex Dame Pansi wrote on Nov 2^nd, 2015 at 7:08am:


Some might pull out, but lets face it all those funds are just parasites bleeding the public purse with regular rises in charges to make massive profits. There is no real incentive for them to operate efficiently as the government will cough up 30% of any increases,

also the subsidy should be restricted to basic hospital cover why cover BS lifestyle crap

Even better still would be to shut it down completely and put all the money into Medicare

Ex Dame Pansi wrote on Nov 2^nd, 2015 at 7:08am:


Probably at first. Then the fees come down. The rebate was no more than a vote buying tool. It made no difference to the cost of cover. Adding a subsidy just places more demand on a product before the supply side can match it. The end result is that the price rises, usually by the amount of the subsidy. A really good example of the poorest of public policy by about 6 billion bucks and rising. Absolutely brilliant as a vote buying carrot while the punters think they're getting something for nothing.

Nah, just vote buying by Howard.

Armchair_Politician wrote on Nov 2^nd, 2015 at 7:47am:


That's the problem with the never ending subsidy. The originator at the time being more interested in buying votes than achieving health cover outcomes. The cost of private health care is no cheaper as a result with the final nail being that all private health insurers obtain a third of their income directly from the gummint coffers to the tune of $6 billion and counting. Truly dumb policy. Ditto child care rebates.

crocodile wrote on Nov 2^nd, 2015 at 7:57am:


Yet membership of health insurance companies is increasing.