SENATOR THE HON ANNE RUSTON

SHADOW MINISTER FOR HEALTH AND AGED CARE

DEPUTY LEADER OF THE OPPOSITION IN THE SENATE

SENATOR FOR SOUTH AUSTRALIA

MEDIA RELEASE

Wednesday, 7 October 2026

LABOR’S PENSIONER PENALTY: COMMITTEE WAVES THROUGH PRIVATE HEALTH PENSIONER TAX

Labor Senators have used their numbers on the Senate Community Affairs Legislation Committee to back the Albanese Government’s cut to the private health insurance rebate for older Australians, ignoring the overwhelming weight of evidence presented to the inquiry and the vast majority of more than 600 submissions.

Labor is the lone Committee voice supporting the Bill. Coalition Senators, the Greens, and Senator Lambie recommended the Bill not be passed. New figures forced out of the Department of Health, Disability and Ageing by Shadow Minister for Health and Aged Care, Senator Anne Ruston, reveal further details on the extent of the cut a single person aged over 70 with Gold hospital cover will pay an average of $34 more every month ($408 a year) as a direct result of the cut. Over-70s on Silver cover will pay $27 more a month ($324 a year).

The Department’s figures also showed that of the more than 3.2 million older Australians targeted by the cut, about 2 million were live on less than $37,000 a year.

“This is an Aged Pensioner penalty, pure and simple,” Senator Ruston said.

“Evidence from older Australians, their advocates, doctors and other healthcare professionals agreed this ill-conceived policy would have a profound impact on vulnerable older Australians.

“Older Australians keep private health insurance not simply because they prefer it but because they cannot afford to be without it. Forcing them to make a decision between their healthcare and meals or heating and cooling is downright cruel.”

The Department conceded it only assessed how many Age Pensioners would be hit after pressure from stakeholders, months after the policy was announced.

“The Government didn’t even bother to count how many pensioners it was hitting until it was forced to. Now we know pensioners will carry half the cost,” Senator Ruston said.

Evidence to the inquiry shows pensioners are the most likely to be priced out. National Seniors Australia’s submission found 76.2 per cent of full-rate Age Pensioners said they would drop their private health insurance if premiums increased, compared with 53.2 per cent of self-funded retirees. Older Australians and their advocates told the Committee people would go without meals, heating and cooling to hold on to their cover.

“These are Australians who have paid their premiums for 40 years because they were told it was the right thing to do. Now Labor is asking them to choose between their health cover and heating their homes,” Senator Ruston said.

The Department’s own data also demolishes Labor’s claim that older Australians are not paying their fair share, with 96 per cent of over-70s holding Gold or Silver cover compared with just 59 per cent of under-65s.

“Older Australians are already doing the heavy lifting. They pay for the highest levels of cover in the system, and Labor is punishing them for it,” Senator Ruston said.

The answers on notice also reveal the Department’s modelling “does not model product tier and therefore cannot identify policyholders with gold hospital cover”. Catholic Health Australia estimates one in five affected over-65s will change their level of cover, around 665,000 downgrades, compared with the 1 in 75 assumed by the Government. Older Australians who downgrade from Gold lose guaranteed cover for joint replacements and cataract surgery.

“The Albanese Government has no idea how many older Australians will downgrade and lose cover for their hips, knees and cataracts. Those who do will be pushed onto public hospital waiting lists that are already far too long,” Senator Ruston said.

No State or Territory has supported Labor’s Bill, with most warning of longer elective surgery waits and millions in extra costs for state taxpayers.

“This isn’t a saving. It’s a cost shift from Canberra onto state hospitals, and it will be older Australians stuck in the queue.”

Coalition Senators have recommended the Bill not be passed.

“Every Senator who votes for this Bill is voting to put up private health premiums for pensioners. The Greens and the crossbench should think very carefully about that before they side with Labor,” Senator Ruston said.

ENDS

Media Contact: Nick Tyrrell – 0438 987 845

Link to Coalition's Dissenting Report