Thursday, March 24, 2016

The Macro View - General And Health News Relevant To E-Health And Health In General.

March 24 Edition
The macroeconomic stresses seem to have eased a little more with markets rising around the world. Indeed the stock market indices in the US are now up for the calendar year.
In Australia, things are also looking up for the present.
However we also are now see a set of ongoing bun-fights on pathology funding, health insurance costs as well as negative gearing and superannuation. Will be fun to watch. Mr Trunbull and Mr Morrison seem to have disappointed with the lack of a clear plan. At present it is not clear what will happen on Budget Night and indeed when the Budget will actually be!
There now seems to be very little tax reform coming - except in Superannuation and possibly company tax.
Here is a summary of interesting things up until the end of last week:
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General Budget Issues.

Scott Morrison brings ALP negative gearing policy under fire

  • The Australian
  • March 14, 2016 12:00AM

Sid Maher

Scott Morrison will intensify his attack today on Labor’s negative gearing policy, releasing 28 questions he says Labor needs to answer, including whether house prices would fall 4 per cent.
The Treasurer’s questions, part of a social media campaign, come as Bill Shorten will seize on the six-month anniversary of Malcolm Turnbull’s becoming Prime Minister to declare him “all talk and no action’’.
Labor has proposed limiting negative gearing to new homes as part of its tax policy, saying it will boost new home building.
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Wealthy primed for Turnbull’s superannuation tax hit

  • The Australian
  • March 16, 2016 12:00AM

Sid Maher

High-income earners face superannuation tax hikes in the ­Turnbull government’s tax package, with one proposal calling for the threshold beyond which contributions are taxed at 30 per cent, rather than the standard 15 per cent, to be lowered, possibly as far as $180,000.
Scott Morrison yesterday flagged that superannuation tax reforms would be announced in the May budget or earlier and would reflect the government’s view that superannuation should aim to reduce dependence on the Age Pension and should not be a vehicle for “estate planning”.
A proposal to reduce the threshold at which the contributions tax rises to 30 per cent from $300,000 to the top marginal tax rate of $180,000 could raise up to $1.5 billion a year and has support from elements in the superannuation industry.
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Treasurer Scott Morrison signals possibility of no tax cuts this budget

Date March 15, 2016 - 12:29PM

Gareth Hutchens

Federal Treasurer Scott Morrison says the government needs to be innovative when it comes to finding budget savings.
Treasurer Scott Morrison has given his clearest signal yet that personal and corporate tax cuts may be too difficult to deliver this budget, despite indicating for months that tax cuts would be his priority.
In an obvious indication of how difficult the Turnbull government is finding the budget repair task, Mr Morrison, when asked on Tuesday about the pressure that high tax rates were putting on the economy, said next year's scheduled removal of the deficit repair levy was an example of forthcoming tax relief.
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Expect great things from Malcolm Turnbull's first budget. No, seriously.

Date March 17, 2016 - 12:00AM

Peter Martin

Economics Editor, The Age

The Prime Minister is prepared to make the most of unusually low interest rates by spending up big on projects that will pay dividends.
The government is considering issuing long-term bonds to fund massive new infrastructure spending. Peter Martin explains the logic.
While the media has been obsessing about tax, Malcolm Turnbull has been focused on setting Australia up. To do it, he'll need to borrow big sums of money for exceptionally long periods at at extraordinarily low interest rates.
We should have done it sooner. Right now Australia can borrow for 10 years at 2.7 per cent, just a few points above the the Reserve Bank's inflation target of 2.5 per cent, meaning we are able to get money for close to nothing. But it's still unattractive for long-term projects because there's a risk that in a decade's time when the loans have to be refinanced, the new rates will be higher. So Turnbull's looking at borrowing for 30 years.
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Turnbull government's next target: limiting claims for work-related expenses at tax time

Date March 16, 2016 - 3:28PM

Alex Malley

It's time to shine a light on some dark political manoeuvring taking in place in Canberra at the moment. In the crosshairs is your right to claim full and legitimate work-related expenses in your annual income tax return.
As we head towards the May budget, the Prime Minister and Treasurer have made it clear that controlling expenditure is a priority. The retreat from holistic tax reform means the hunt for savings is well and truly on – it's why Treasurer Scott Morrison tasked a parliamentary committee with an urgent inquiry into tax deductibility.
We understand the committee's report has been finalised and is sitting with the government, its recommendations being fed into the budget process. We'll likely hear nothing about it until budget night (whenever that might be).
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Pressure on government to make budget repair levy permanent

Date March 17, 2016 - 12:15AM

Gareth Hutchens, Peter Martin, Mark Kenny

The opposition targets the government's abandonment of income tax reform as the government attacks Labor's fiscal record in question time on Thursday.
The Turnbull government is being called on to retain the temporary budget repair levy on high-income earners, which is due to expire next July, after conceding this week that tax cuts for individuals may be unaffordable in this budget due to lack of funds.
The temporary 2 per cent loading on the top tax bracket is scheduled to be removed in July 2017, giving high-income earners on more than $180,000 an effective tax cut.
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Backpacker tax: government to review controversial budget measure

  • The Australian
  • March 16, 2016 2:17PM

Rachel Baxendale

The federal government has announced a review of its controversial backpacker tax, admitting it could have an adverse effect on the agriculture and tourism industries.
The 2015 federal budget measure would see those on working holiday visas pay 32.5 cents tax for every dollar they earn, and forego the $18,299 tax-free threshold.
Speaking at the Tourism & Transport Forum Australia in Sydney this morning, Tourism Minister Richard Colbeck announced a cross-departmental review of the proposed tax to find a “revenue neutral” solution.
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Fitch warns Australia of ratings cut over deficit blowout

  • The Australian
  • March 17, 2016 12:00AM

Adam Creighton

Ratings agency Fitch has warned the Turnbull government against tolerating further debt blowouts, stressing Australia’s vulnerability to record foreign debt, fragile housing prices and a Chinese economic slowdown.
Fitch yesterday reaffirmed the Australian government’s AAA credit rating but said a “sustained widening of the fiscal deficit without remedial policy actions” could see it stripped of the coveted financial endorsement.
“Despite resilient GDP growth, a sharp fall in the terms of trade has weighed on nominal income growth, reducing tax revenues and slowing the expected pace of fiscal consolidation,” it said, noting total federal and state government debt had increased rapidly to 34.5 per cent of GDP or near the average level (43.6 per cent) of AAA-rated countries.
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  • Mar 17 2016 at 9:30 PM
  • Updated Mar 18 2016 at 10:23 AM

Morrison to cut company taxes; income taxes to wait years

by Staff reporters
Salary earners will have to wait some years for an income tax cut after Treasurer Scott Morrison confirmed on Thursday that company tax cuts will be his priority in the federal budget.
After indicating on Tuesday that the government had ditched plans for the income tax cuts it has been pledging for several months, Mr Morrison told Parliament the best way to fund income tax cuts was through economic growth. And the best way to drive economic growth was by reducing the 30 per cent company tax rate.
"We understand the burdens faced by people who are paying higher and higher rates of income tax. We understand that and we understand the best way to deal with that … [is to] grow the economy so you can grow revenues to support those changes," he said.
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Public may turn ‘hostile’ if govt messes with tax

Daniel Burdon | 18th Mar 2016 6:00 AM
A MAJOR accounting firm has urged the Turnbull government not to target people's work-related tax deductions, warning any changes will be "met with hostility".
The warning has come in a submission to a government-led inquiry into tax deductions that is understood to be "softening the ground" ahead of Treasurer Scott Morrison's first budget in May.
While the government has reportedly abandoned income tax cuts in favour of a company tax cut this budget, it is understood to be exploring potential savings by reining in work-related tax deductions.
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Samantha Maiden: Tax not adding up for Treasurer Scott Morrison

March 20, 2016 12:00am
SAMANTHA MAIDENThe Sunday Telegraph
BILLIONAIRE Oprah Winfrey once wrote a self-help book called What I Know For Sure.
Here’s what everyone in politics knows for sure about Scott Morrison.
If the Treasurer (pictured above) seriously thinks he can front up on Budget night without holding out the hope of income tax cuts for average earners he is in big trouble.
Time to hand in his police badge and his gun kind of trouble.
Burn the uniform, shave your head like Mark Latham. Nip down to Coles and buy a family tub of ice cream and a spoon and just go sit in a park. It’s over.
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Health Budget Issues.

Margaret Wenham
March 16, 2016 12:00am

Australia, we’re being ripped off

Here’s something for reform-spruiking Health Minister Sussan Ley to mull over: Australians are lumbered with an expensive, inefficient, bastard, hybrid health system that’s anything but a fair deal.
We are Medicare levy-paying taxpayers who are often unable to access, without unreasonable and distressing waiting periods, public treatment.
Most of us are also paying, under threat of punishing Medicare levy surcharges and savage “lifetime health cover” penalties, bloated health insurance premiums yet, when we require treatment, we are frequently expected to stump up supersized gap payments.
We are also forced to wait for 12 months even for private treatment if a condition develops requiring an insurance upgrade.
Think I’m overstating this diabolical shambles of a system? Well, last week I spoke with Julie. A former high school teacher, 20 years ago Julie set up her own business as a Qi gong instructor. She was super fit when she began having significant hip pain and was told a full hip replacement loomed.
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Prime Minister confirms children’s free dental health program faces axe

March 17, 2016

Shorten accuses Turnbull of caving in to the backbench

Kara Vickery News Corp Australia Network
PRIME Minister Malcolm Turnbull has confirmed he’s considering scrapping a dental health scheme, which has been used by around one million children since it was introduced.
Mr Turnbull told parliament on Thursday that the Labor scheme — which gives children $1000 worth of free dental care every two years — was failing to live up to expectations.
And the PM confirmed earlier reports the future of the program was under review.
Mr Turnbull said the scheme was “nowhere near meeting its targets”.
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Foreigners rack up millions in sick bills

  • The Australian
  • March 18, 2016 12:00AM

Sean Parnell

Foreign students and backpackers are adding to queues in public ­hospitals and leaving unpaid bills of tens of millions of dollars each year.
Most visa-holders are not ­eligible for Medicare and are ­required by the federal government to have health insurance in the expectation they will pay their own medical expenses as required.
Yet despite paying high premiums, thousands of foreign citizens are presenting to public hospitals for treatment and forcing administrators to chase payment later.
The trend raises questions over the value of such insurance ­policies and whether visa requirements are having the desired ­effect.
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Health Insurance Issues.

One Big Switch: health insurance hikes put pressure on households

March 13, 2016 11:45pm
John Rolfe Cost of Living Editor News Corp Australia Network
The campaign aims to use “people power” to extract cheaper cover from a leading provider.
EXCLUSIVE
THE latest health insurance hike is about to make the cost of cover a heftier hit than petrol for the first time on record.
For those households that don’t have childcare or private school fees to contend with, fuel has been entrenched as the third-biggest expense after the mortgage — or rent — and groceries.
However, analysis by News Corp Australia shows health insurance is set to displace it.
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Public patients ­persuaded to bill their private health fund

  • The Australian
  • March 16, 2016 12:00AM

Sean Parnell

Almost one in five emergency ­patients admitted to public hospitals for urgent operations, and one in 10 who have elective surgery in the public system, are ­persuaded to bill their health fund.
New data from the Australian Institute of Health and Welfare highlights the billion-dollar cost shift to insurers as state and territory governments seek to rely on alternative revenue streams to manage constrained budgets.
Under universal healthcare, Australians have a right to be treated without charge in the public system and taxpayers have traditionally funded such ser­vices. Public hospitals cannot force privately insured patients to bill their health fund, however hospital administrators now ­actively target such members, ­offering to pay their gap fees and even provide a private room.
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Public patients ­persuaded to bill their private health fund

  • The Australian
  • March 16, 2016 12:00AM

Sean Parnell

Almost one in five emergency ­patients admitted to public hospitals for urgent operations, and one in 10 who have elective surgery in the public system, are ­persuaded to bill their health fund.
New data from the Australian Institute of Health and Welfare highlights the billion-dollar cost shift to insurers as state and territory governments seek to rely on alternative revenue streams to manage constrained budgets.
Under universal healthcare, Australians have a right to be treated without charge in the public system and taxpayers have traditionally funded such ser­vices. Public hospitals cannot force privately insured patients to bill their health fund, however hospital administrators now ­actively target such members, ­offering to pay their gap fees and even provide a private room.
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Best and worst health insurers revealed in AMA report card

Date March 17, 2016 - 12:42PM

Julia Medew

Health Editor

The worst private health insurers have been revealed by a new analysis that shows some of the leading insurers, including Medibank and NIB, are not the most generous of all.
A new league table created by the Australian Medical Association has exposed what health insurers pay for 22 common procedures including cataract surgery, tonsil removals, colonoscopies and births.
It shows a large variation in payments for the same procedures, suggesting some policy holders are more likely to face out of pocket fees than others. For example, HBF pays $2150 for an uncomplicated delivery of a baby while GMHBA pays $832 - a difference of 158 per cent.
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Health is also clearly still under review as far as its budget is concerned with still a few reviews underway and some changes in key strategic directions. Lots to keep up with here with all the various pre-budget kites still being flown - although narrowing it seems to be largely focussed on Super! Enjoy.
David.

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