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NIB boss calls for abolition of Medicare

Mark Fitzgibbon, head of NIB, one of Australia’s biggest private health care providers, has this week proposed the abolition of Medicare and the introduction of compulsory private health insurance, in a highly controversial move that has reignited the simmering debate over private healthcare.

He described Medicare as a “government monopoly” whilst warning of a growing crisis facing private health insurers over burgeoning costs.

“(The) sensible policy approach would be to make private health insurance compulsory for all Australians with taxation devoted to subsidising the premiums for those who would otherwise be left behind,” Mr Fitzgibbon wrote in an opinion piece for The Australian Financial Review.

“That is, high-income earners would at one end of the scale pay the entire premium while at the other, those with low income fully subsidised.”

This comes as Health Minister Greg Hunt flags the ‘next stage’ of private health insurance reforms, saying he met with private hospitals, private health insurers and other medical leaders: “we’ve got to work on those cost drivers. So, we dealt with prostheses last time, they’ll be coming back to me shortly, those three groups with their suggestions and their proposals”.

The op-ed also came on the back of a report published last week by think tank the Grattan Institute which suggested that the private health insurance industry was in a “death spiral”, a suggestion that Mr Fitzgibbon dismissed, saying “the industry is doing well”.

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Mr Fitzgibbon did not believe that his ideas were particularly controversial.

“It’s hardly a radical proposition when you consider Medicare is itself a compulsory ‘social insurance’ system. It’s not as if you or I can opt out of Medicare,” Mr Fitzgibbon wrote.

“And no different to the approach taken by many ‘left-leaning’ European governments that don’t feel it necessary to actually run a health insurance system to ensure cost-effectiveness and fairness.”

The views professed by Mr Fitzgibbon did not garner much public support, with his op-ed slammed across the spectrum of government and industry, with Mr Hunt quick to restate the Federal Government’s unequivocal support for Medicare, saying that the Coalition remained “committed to (Medicare) for life, forever”.

“I did see one comment today questioning Medicare, and I have to say clearly and categorically that we reject that proposition: clearly, categorically and absolutely,” he told reporters this week.

“But equally, we’re committed to private health insurance. Both of those elements are part of the model that best serves Australians.”

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