The cost of healthcare is under scrutiny in the wake of revelations that a growing number of Australians are seeking early access to their superannuation to pay medical expenses. The Association of Superannuation Funds of Australia raised concerns about this trend in February, warning that it demonstrates the need for government funding to the healthcare sector to be increased and better-targeted. Shadow health minister Chris Bowen has expressed similar concerns. From The Australian:
…more than 30,000 requests for early access to superannuation to pay for healthcare were approved last financial year, twice as many as two years ago. The average amount released was almost $15,000, often spent on weight-loss surgery or IVF.
The superannuation sector, financial advisers and some health groups had previously called on Treasury to tighten the rules in order to protect the nest eggs but Treasury proposed only minor changes last year, saying “early access to superannuation could be beneficial in a world of finite government resources”…
Even before the latest figures were revealed, the ASFA was warning that “any significant increase should act as a signal to government that the healthcare needs of the Australian population are not being served adequately by the healthcare system and reforms, including increased and better-targeted funding, are necessary”.
According to the latest Department of Human Services annual report, the number of applications received for the early release of super ballooned to just under 39,662 in 2017-18, with 24,073 approvals granted with a total value worth $343.9 million.
Obviously, legislated increases in the compulsory superannuation guarantee will rob households of further disposable income, making it harder to meet medical and other expenses.
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