Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) Bill 2026
Ms LE (Fowler) (10:47): The government frames the reforms in the Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) Bill 2026 as a matter of intergenerational equity and simplification of our aged-care system. If that is truly the outcome, then I welcome it. But, in its current form, I have serious doubts about that.
In recent days, many members in this House and in the other place have expressed those doubts as well. No-one denies that our aged-care system desperately needs better funding. But the solution cannot be to claw back money from the very people who need it most and already have the least.
But, before I turn to the detail, I want to make one request of this place. It is also a request of the people who design these policies and advise this government. Australia is a vast country.
We have deeply diverse populations and deeply diverse needs. A policy that looks fair on a national average can land very differently in a suburb like Cabramatta or Liverpool. Too often reforms are built around an imagined average Australian.
Communities like mine do not fit that picture. Here in Fowler many people speak a language other than English at home. That is not malice; it is unconscious bias.
It is quietly baked into the assumptions, the modelling and the data. It is my job to name it. The government projects this measure will reduce Commonwealth spending by around $3 billion over four years, with promises that those savings will be redirected to high-priority aged care.
They are meant to go to the Support at Home program, new dementia care units and residential capital subsidies. These are good priorities. They speak to what families in Fowler worry about every single day—whether their elderly parents can stay safe at home, whether there is dementia care that understands their language and their faith, and whether local facilities are properly staffed.
But behind those good intentions is a story untold. A recently published Parliamentary Budget Office analysis found that, under the reforms in this bill which scrap the rebate on private health cover for those aged 65 and over, about $1.6 billion would be taken from around 1.5 million age pensioners who hold private health insurance. Another issue is accountability.
Every cent of that $3 billion must flow to the front line—to families struggling to care for their loved ones and to services built for a multicultural Australia and the communities that need them most. I say this because I have seen what happens when the money does not reach the front line. For years, alongside the Mayor of Fairfield, Frank Carbone, I have fought for Fairfield Hospital.
We fought to have its electrical capacity upgraded because the old building could not carry the load. But our case was always bigger than the wiring. We fought for an improved emergency department, we fought for the resources to care for a growing senior population and we fought for a community carrying more and more chronic illness in a low-socioeconomic area.
We want that capacity upgrade. We have secured extra funding since. And yet I'm told that some of that money has gone to a car-park building.
Meanwhile, the wards still do not have wi-fi because the old building blocks the signal. I do not raise this to score a point. I raise it because it is the truth of how this works.
A funding announcement in Canberra is not the same as care on the ward. The headline is decided here. The reality is lived in Fowler.
So, when the government tells my community that $3 billion will flow to aged care, my community is right to ask one question: will it actually arrive? In my community we have a very large number of seniors living on modest incomes. They've worked their whole lives in factories, in service jobs and running small family businesses.
Many arrived here decades ago with nothing, and they built a life. Today they rely on the age pension, modest super or limited self-funded income, and they are already being crushed by the cost of living—energy bills, rent, groceries and the rising costs of treating age related illness. For these seniors, private health insurance is a safety net.
It is how they manage their health when public waiting lists are long and specialists are hard to reach. Under this bill, the age based uplift in the rebate is removed entirely. Older Australians will receive the same percentage rebate as younger Australians on the same income.
That is a direct cut for seniors. The estimated average reduction for those aged 65 and over in the affected income tiers is $252 per person by 2028-29. In Canberra, $250 a year might look modest.
In Cabramatta, Liverpool or Fairfield, it is a fortnight of groceries. It is the difference between keeping the lights on and falling behind. And this is exactly where the unconscious bias shows itself—not in bad intent but in the design.
The department did not consult specifically on these changes. It cited budget confidentiality and relied on data from 2022 to 2023, so the full weight of today's cost-of-living crisis on our seniors was never captured. The model assumes 99 per cent of seniors will keep their cover.
The thinking is that older Australians value it more, but that assumes everyone can absorb the hit. What if the affordability tipping point has been miscalculated? If seniors can no longer bridge the gap, they will downgrade from gold to silver or silver to bronze.
They will raise their excess or they will cut extras like dental and physio. Every one of those choices strips away protection. A national average smooths all of this over.
It cannot see the pensioner in my electorate, for whom $252 is the line between coping and going without. That is the blind spot I'm asking this place to correct. Moreover, the headline $3 billion saving may be no saving at all, just a cost shifted from the Commonwealth onto our already stretched state hospitals, and money taken out of struggling pensioners' pockets.
When older Australians give up their private health cover, they do not stop needing care. They move from the private system to the public one. Not long ago I visited a private day hospital in Chipping Norton, in my part of Sydney.
I walked the floor. This is the place that does the very elective work I am talking about: cataracts, endoscopies and, in early years, orthopaedics, and gynaecology as well. These are the procedures our oldest Australians wait for.
The staff told me something that has stayed with me. During the pandemic, that one facility took on public cases from Fairfield, Liverpool, Campbelltown and Bankstown. I was told they did it at a fraction of the cost of the public system.
They were proud of their work, and they were right to be. I raise it because it shows how tightly the private and public systems are bound together in my electorate. When an older person can no longer afford their cover, they do not stop needing the surgery; they join a longer queue—and that queue sits in a public system already carrying enormous demand.
The pressure does not vanish; it simply moves, and, in south-west Sydney, it moves to where people can least afford to wait. For our culturally and linguistically diverse seniors, there is one more layer: people who do not speak English fluently already struggle to navigate a complex system. They find it harder to compare products, harder to understand sudden changes to their rebate and harder to advocate for themselves.
Weaken their cover, and their vulnerability grows—in ways that national data simply does not capture. I urge the government not to proceed with this bill because it risks doing more harm than good. The minister has stated multiple times in this House that this is a hard choice to make, but a hard choice made in Canberra might have unbearable consequences for pensioners in communities like mine.
My closing message to everyone who designs and delivers policy in this country is: see the whole of Australia, not just the average. Check the assumptions, check the bias and build policy for the diversity that lives here. The people of Fowler deserve to be seen.