I rise today to speak about the government's abject failure to properly fund public health care for all Australians and its failure to control the spiralling costs of the private health insurance industry. Just this morning I read an article about the rising number of women who opt to use public rather than private hospitals to give birth because of the high out-of-pocket costs involved in the private system. This is just one more example of the soaring costs of private health insurance and the growing number of Australians who are choosing to ditch their cover in response to relentless price rises, unexpected out-of-pocket costs and growing exclusions.
Australians are paying a lot more for their health insurance policies and getting a lot less. Ten years ago only 8.6 per cent of health insurance policies contained exclusions; now it's 40 per cent. These exclusions, often hidden in the fine print, mean that people are paying for insurance without being covered. It's turning health insurance into a con. I've had personal experience. We all have. My elderly mother-in-law has had lengthy periods in private hospitals with chest infections. She's paid her private health insurance premiums for decades, and we are always pleasantly surprised on discharge to be told we don't have to pay anything there and then. But, over the following weeks, the bills roll in—pharmacy costs, pathology costs and other tests not covered—to the point where we start to wonder when they will stop.
I know this is a familiar story. We know that Australians pay some of the highest out-of-pocket costs in the OECD to the for-profit health insurance industry, which made around $2 billion in profits last year. Some of the biggest health insurance providers make a return of over 20 per cent. And, as we know and have heard in this House before, this is an industry that's holding about $6 billion over and above the legal capital requirement and gets $6 billion in taxpayer-funded subsidies each year. Still, despite all this, the industry continues to increase its costs, year after year. For decades, in fact, Australians who have opted to buy private health insurance have been getting hit with price rises double or even triple inflation from an industry that enjoys generous government subsidies, and this is just plain wrong.
Labor, on the other hand, has a strong policy to cap premium price increases at two per cent for two years, effectively tying them to general inflation, a policy that will put $340 back into the pockets of Australian families. But private health insurance is a choice—a choice that more and more people can't afford. The article I read this morning about mums deserting private health insurance quoted Libby Nuttall, a 32-year-old mother of three, who said she'd heard stories about the private system such as that, when a doctor at 5 pm on Friday wants to go home and the woman's in labour, they will do a caesarean rather than let the pregnancy take its natural course. Of course, not all doctors and not all hospitals in the private system are like that. But it seems to me that the trust in the private system is waning. It is waning due to excessive out-of-pocket costs and poorer quality of care, and more and more people are turning to their trusted public health system.
It tells us that our public health system is vital for so many Australians. We cannot afford to starve our public health system of funding. The Liberals have cut billions of dollars from our public hospital system, putting stress and strain on our hospitals and causing anguish for patients and their communities and for the people who work tirelessly in our public health system to keep it going. We are lucky indeed to have such a wonderful health system. I myself worked there as a nurse for years and totally appreciate the importance of the services. I congratulate our doctors, nurses, allied health workers and all the auxiliary staff who keep the system running with fewer and fewer resources, but they can't do it forever. They can't keep doing more with less.
We need to reinvest in our public hospitals, and I'm proud to say that Labor will reverse the government cuts, giving vital resources to our hospitals, because we deserve a public health system that stays the envy of the world. As for our primary healthcare system and our beloved Medicare, out-of-pocket costs are beginning to become a barrier to people seeing their GP. What does that mean? It means that more and more people stay sicker and present to our emergency departments, putting more and more pressure on our public hospitals and, in fact, increasing costs, because, as we all know, our tertiary healthcare system is far more expensive than doing good, decent primary health care.
The pressure on our public hospitals means that fewer and fewer people can get there. Fewer and fewer people will be receiving the care they need. Trashing the promise of universal health care exacerbates this. So the choice at the next election and in next month's by-elections could not be clearer: more savage cuts under the Liberals or record healthcare investment under Labor.