The same Medicare rebate goes to everyone and the same private health insurance rebate should go to everyone, too – and it did until yesterday when the Gillard government dumped the principle of universal health care.

 

The private health insurance means test undermines Medicare, hits every single one of the 2.2 million Sydneysiders with health insurance and is yet another Gillard broken promise.

 

The new means test on the private health insurance rebate will hit many people who are not rich. Single people paying a Sydney mortgage and earning over $83,000 a year are not rich.

 

Families trying to buy a home in Sydney and earning over $166,000 a year are certainly not rich.

 

But Julia Gillard thinks they are and yesterday condemned them to paying up to $1000 a year more for their private health insurance.

 

Thanks to this latest Gillard government means test, following the family tax benefit means test and the baby bonus means test, which were also broken promises, 2.5 million people around Australia will pay up to $20 a week more for health care.

 

Everyone will pay more for private health insurance because of the mean test. A Deloittes study shows that higher premiums for higher income earners, who are generally younger and healthier, will eventually cause about six million Australians to drop or downgrade private cover. It's estimated that this will raise premiums for everyone else by 10 per cent.

 

That's a 10 per cent rise for three million privately insured Australians earning under $35,000 a year, in addition to the 30 per cent increase for higher income earners.

 

With prices going up anyway, and a carbon tax adding around $500 to NSW household bills, this is the last thing that families need.

 

Julia Gillard has never understood the cost of living pressures Sydney families face.

 

It is unlikely to be the last attack on health services from a Labor government that can't control its wasteful spending. No doubt, at some stage, Prime Minister Gillard will declare that there will be "no further changes to private health insurance under the government I lead" but any such pledge will be as believable as her pre-election promise never to have a carbon tax.

 

Make no mistake, this is not just an attack on private health insurance but an attack on health funding more generally. By subsidising 30 per cent of private health costs, the government avoids having to subsidise nearer to 100 per cent of public health costs.

 

By imposing a means test, the government is ripping $2.4 billion out of the health system at large – not just out of private hospital services – because the less that's spent on operations in the private system, the more that will have to be spent on operations in the public hospital system and the longer waiting lists will get.

 

The Deloittes study shows that reduced numbers in private health insurance because of the means test will lead to a further 845,000 patients over the next five years seeking treatment in public hospitals. Paying for these additional procedures will cost the states an estimated $3.8 billion a year. None of the government's means test-induced savings will be spent on alternative health programs. Except for the cut to private health insurance and a $200 million dental sweetener for the Greens, the means test savings aren't funding extra beds in public hospitals.

 

They're just propping up a government that otherwise would not be able to produce a budget surplus.

 

By driving people out of private health and raising the premiums for those who stay, the Gillard government's means test is effectively a health tax. It's bad policy based on a lie.

 

The Prime Minister repeatedly said before the 2007 election that the private health insurance rebate would never be "eroded" but Labor had scarcely settled into government before this solemn promise was junked.

 

In the last parliament, two independent senators stopped government members from making liars of themselves but current independents have failed their duty to "keep the bastards honest".

 

Whether for betraying Kevin Rudd over the prime ministership, the Australian people over the carbon tax, the independent Mr Andrew Wilkie over poker machine reforms, or the Christian lobby over gay marriage, her weak prevarication over her office's role in provoking the Australia Day riot or her ministers' involvement in the unreasonably delayed Craig Thomson investigation, there's now a perception that this Prime Minister has a brazen disrespect for telling the truth.

 

By contrast, support for private health insurance is an article of faith for the Liberal National Coalition. We will restore the rebate in government as soon as we can.