NSW 2013-14 Budget - $86m increase in health insurance levy
After lots of speculation in the media about a potential increase of $80m in the NSW health insurance levy, the OSR stated that “The amendment provides for the increase of the base rate under the Health Insurance Levies Act 1982 from $1.37 to $2 on a date to be proclaimed” - refer to this OSR weblink.
Table 6.5 of chapter 6 of budget paper no.2 shows a $86m increase in health insurance levy. The table includes a foot note saying “The Government will meet with health funds to seek a reversal of their rate cuts for private patients in public hospitals as an alternative to increasing the Health Insurance levy.”
- Does this mean that health insurers that did not cut their rates for private patients in public hospitals should proceed and cut their rates?
- Will other states follow NSW?
- Will actuaries factor this into their premium application projection given that it may be reversed?
“Insurers Medibank, NIB, BUPA and AHM will have until July 1 to negotiate before the levy comes into place, after all four unilaterally cut the amount they would pay for private rooms by one-third.” - article