Want real health reform? Integrate public and private health into one mandatory insurance system

Health Minister Sussan Ley is considering applications from private health insurers to increase premiums by 6-7% in 2016, four times higher than the rate of inflation. Rising premiums and better value for consumers are on the agenda at Ley’s private health insurance reform consultations this month. But while health-care costs are growing – due to an ageing population with higher rates of chronic diseases and greater use of health technologies – rising premiums are also the consequence of structural system design flaws. To make the system sustainable in the long term, our report, released this week by Victoria University’s Australian Health Policy Collaboration, proposes a model that integrates public and private health expenditure into a universal, mandatory health insurance scheme. Consumers would have the choice between private health insurers and at least one government-run provider (which could be a version of Medicare or an insurer as was Medibank). All insurers would have to provide a comprehensive set of health services to their customers, covering all essential aspects of their health care. Everybody would pay a (regulated) premium and also receive a government subsidy, based on their health status and ability to pay. This would ensure all residents would access the scheme