Senate Medicare Surcharge vote prevents further pain for country hospitals

“…Country hospitals just cannot afford a massive influx of extra patients...” A vote by the Senate on Wednesday to block the Rudd Government’s planned increase in the Medicare Levy Surcharge threshold was necessary to prevent further pressure on beleaguered country hospitals, according to North Coast Nationals Senator Fiona Nash. The Medical Levy Surcharge means people with earnings above a certain threshold, currently $50,000 for single and $100,000 for families, pay one per cent extra income tax if they do not have private hospital cover. The Government wanted to increase those thresholds to $100,000 for singles (later reduced to $75,000 under an amendment) and $150,000 for families. “The problem with that policy,” Senator Nash says, “is that the Government concedes it will lead to 485,000 middle income Australians dropping their private cover and using the overstretched public system instead.” “It is estimated this would also force up private health premiums by a further 10 per cent for those who stay in the system.” “Now, the Nationals have no problem with the Government continuing the Coalition’s record of cutting income tax, but this is the wrong way of going about it.” “Government figures also show this is effectively a tax grab anyway: Treasury would forfeit $660 million from not collecting as much Surcharge, but save $960 million from not having to pay the 30% private insurance rebate to those who drop out.” “Country hospitals just cannot afford a massive influx of extra patients. For example the Tweed Hospital is already turning away patients because it is operating at over 100 per cent capacity; and hospitals in Gilgandra and Coonabarabran have had to stop serving meat to patients because the State Labor Government won’t pay their butchers’ bills.” Contact: Murray Lees, media adviser, 0447 34 00 25

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