Cricket – Junk food and BUPA

I used to be a grafted-on cricket watcher. But I am being weaned off. One reason is that there is so much cricket on TV that the quality suffers.

I mostly turn off the audio and although the camera work is superb, I can’t turn off the unhealthy diet of fast-food and beer advertisements that Channel 9 and Foxtel overwhelm me with from first ball to stumps. I thought sport had something to do with encouraging healthy lifestyles. But the endless Kentucky Fried Chicken, Macdonalds, Pizza Hut and Victorian Bitter advertisements do just the reverse.

But my real irritation is with the BUPA ads that give me pointless information about the heart rate of players and the nonsensical suggestion that by spending money with BUPA I will  be a ‘healthier you’. Advertising by BUPA is subsidised by the Australian taxpayer. The $3.5 billion p.a. tax subsidy that the private health funds receive goes, in theory, to policy holders, but in practice to funds like BUPA. Without that taxpayer subsidy very few would buy BUPA’s products.

BUPA boasts that it has about a 30% market share of private health insurance. With the industry subsidy totalling $3.5 billion p.a., that represents a subsidy by taxpayers of over $1 billion p.a. for BUPA.

Like other wasteful private health funds, BUPA pretends that it offers choice, but it sells practically identical products – choice without variety. One reason why we have a relatively good and low cost health scheme is that Medicare is a strong single payer. Private health insurance has  crippled efficient and equitable healthcare in the US because private funds like BUPA do not have the power or willingness to control costs. Advertising campaigns like BUPA’s take us further down the disastrous  US path.

BUPA  and other health insurance funds floated  ‘Medicare Select’  to the Rudd Government. This  would have encouraged  many people to opt out of Medicare. It would have been goodnight to Medicare. Companies like BUPA favour the wealthiest, they increase the usage of health services, they undermine Medicare’s ability to control costs and quality and their administrative costs are three times those of Medicare. They have not taken pressure off public hospitals. ‘Gap insurance’ provided by companies like BUPA has triggered the largest increase in specialist fees in a quarter of a century.

As taxpayers and citizens, we should be aware of  the damage that companies like BUPA are wreaking on health services in Australia. Why should taxpayers money be used not only to disrupt my enjoyment of cricket on TV, but also to cause so much damage to health services in this country.

Together with Ian McAuley I have written many articles on this subject. See and click on ‘health’.

John Menadue


John Laurence Menadue is the publisher of Pearls & Irritations. He has had a distinguished career both in the private sector and in the Public Service.

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2 Responses to Cricket – Junk food and BUPA

  1. Tim says:

    Hi John

    I strongly agree with you. Bupa is an appalling company that is turning a massive profit from people’s health. I’m just wanting to locate the source of your stats when it comes to how much the government is subsidising private health. Could you post that here please?

    • John Menadue says:

      Dear Tim, Sorry for the delay in replying. I had to go back through my sources. Governments don’t make it easy to check a lot of their spending.
      The figure of $3.5 billion is derived as follows: The Australian Institute of Health and Welfare 2011, Health Expenditure Bulletin, which comes out about 15 months after the end of the financial year, on p.36 shows that ‘The premium rebates that the Australian Government paid through the tax system or directly to private health insurance funds increased from $4.3 billion in 2009/10 to $4.6 billion in 2010/11’. That figure is thus about two years old. Over the last 11 years there has been an annual growth rate in the rebate of 8.9%. Projecting this forward, we get a figure of $5.4 billion in 2012/13. That figure does not include revenue foregone by allowing people with high incomes to avoid the Medicare Levy Surcharge. This revenue foregone is estimated to be about $1 billion p.a. There has also been a tightening of the means test on the rebate. Taking all the above into account, my judgement is that the $3.5 billion is a very conservative estimate of the cost of the subsidy to the inefficient PHI firms who undermine cost control in the healthcare sector in Australia. John Menadue

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