The ADA has again called on the Government to look at alternative models to private health insurance such as Health Savings Accounts (HSAs) to encourage Australians to save for their own care.
“Many Australians take out ‘general treatment’ or ‘extras’ cover in addition to hospital cover, to help pay for their dental, physio or optometry treatment,” ADA president Dr Carmelo Bonanno said.
“But in reality, they’re not getting value for money as benefits paid are not keeping pace with inflation.
“The ADA has repeatedly demonstrated that dental fees are consistently well below CPI—yet benefits paid for treatment under some policies have not increased for years,” Dr Bonanno added.
“Coupled with increasing premiums, the value from ‘extras’ cover is not realised. That’s why the ADA is recommending that the Government introduces tax benefits for individuals who open a Health Savings Account, the same as people currently get for their health insurance premium contributions.”
Last year, the ADA engaged the Centre for International Economics to prepare a detailed report on the feasibility of introducing HSAs, similar to the model used in Singapore. The Saving For One’s Care Report demonstrated the viability and benefits to individuals of HSAs.
But to make it competitive, the Government would need to apply the same tax incentives offered to individuals who take out private health insurance.
“Health insurers are offering a product where consumers are voting with their feet because of a lack of value, despite billions in subsidies,” Dr Bonanno said.
“Frankly, it’s time for a productivity commission review of the system and for a serious look at giving consumers access to a government supported health savings account.”
This article was sourced from an ADA press release.