It is good news that the private members which seeks to provide a 25% tax rebate on health insurance costs for the over 65’s has finally been drawn from the ballot. The bill also tries to address the issue of encouraging self-insurance for health costs by removing the Fringe Benefit tax from health insurance and compulsory health insurance for visiting non-residents.
For me the biggest issue is helping to make health insurance more affordable for the over 65’s. For many years the evidence has been there to indicate the need for people to have access to private health insurance especially as they get older. Since 2006 treasury has identified the growth in health spending as the number one fiscal challenge New Zealand faces. The projected growth in public health spending over the coming decades equates to 4% of GDP and in dollar terms is a third larger than the cost of NZ Super under current policies.
It is self-evident from the change in the demographic makeup to a greater portion of older population that this will put pressure on the health system. Compared to other OECD countries, New Zealand is over reliant on public funding with just 17% of health funding being from private sources compared to the OECD average of 28%.
Most importantly far too many people are cancelling their cover at the very time they have a greater need. I see my mission being to help people to be able to fund their medical insurance into their retirement. Making sure that they have the right type of policy to cover the big risk is part of this but I see this bill as being an important way the government can assist those over 65 to keep their policies in place