Forget private cover

SAVE your money and don’t bother with private health insurance.

The public hospital system is now so good Australians can get away with not joining a health fund, a major investment bank has found.

And the claim private health insurance is vital to easing pressure on public hospital waiting lists is also a myth according to investment adviser Morgan Stanley.

In a 63-page analysis obtained by News Corp the investment bank warns “many people now see the free public hospital system as adequate catastrophe cover”.

Morgan Stanley’s executive director Daniel Toohey says the private health industry has become lazy and the government should freeze premium rises for three years to force the industry to sort itself out.

The report even dismisses the government’s tax penalty that forces higher income Australians into private health cover as losing its sting as premiums skyrocket.

The bank produced the research to guide its advice to clients thinking of stockmarket investments in health funds and public hospitals.

Other research by independent market research company IPSOS has also found the confidence of Australians in the public hospital system has risen by 10-15 points in the last decade to over 80 per cent.

The revelations come as health funds are under fire for covering less and less of member’s health bills. Gap payments health fund members face when they use a surgeon in a private hospital have soared nearly 20 per cent.

Health funds made $1.4 billion in profits last financial year.