The government appears to have secured enough parliamentary support to push up the cost of private health insurance for higher income earners, a move that will add $2.4billion to the budget bottom line.
Labor needs three crossbench votes to go ahead with its plan to means test the 30per cent private health rebate. In the 2007 election campaign Labor promised not to increase the rebate.
In government, it backflipped on the issue in 2010 but has not been able to get sufficient support form the hung parliament.
The Canberra Times understands the government is now confident it has secured the numbers to get its legislation through the lower house of Parliament.
The means test will affect more than two million Australians and help the government get the budget back into surplus.
Health Minister Tanya Plibersek said by introducing a means test on private health insurance, further investments could be made into health care for all Australians.
''We are able to make these investments by carefully considering where every dollar goes,'' she told Parliament yesterday.
''We are doing this because we do not want a situation where the people who sit on this front bench or that front bench have their private health insurance subsidised by the people who clean this chamber at night.''
Winning enough support was a tougher task before the defection of Peter Slipper from the Coalition to take up the Speaker's chair.
But the increased margin that move gave the government, with former Speaker Harry Jenkins returning to Labor's backbench, only three votes from outside the Labor ranks are now needed.
Greens MP Adam Bandt was already supportive of the legislation, although his party wants a greater Government commitment to dental health care in return.
Yesterday Independent MP Andrew Wilkie flagged his intention to vote with the government on the issue and his fellow crossbencher Rob Oakeshott is likely to do the same.
The vote is expected to take place next week before it goes to the Senate where it should easily pass with the Greens' support.
Under the changes, most single people earning between $80,000 and $124,000 and families and couples earning between $160,000 and $248,000 would have their Private Heath Insurance rebates reduced from 30 per cent to between 20 per cent and 10 per cent.
Higher rebates would be paid to people aged 65 and above.
Singles earning more than $124,000 and couples and families earning more than $247,000 would not be eligible for a rebate.
Mr Wilkie yesterday said he was inclined to vote for the changes but needed to do some further research before making a final decision.
''I think the move to increase the surcharge on high-income earners without private health insurance is entirely consistent with the move to means test the rebate for those that do take out private health insurance,''' Mr Wilkie said.
''We're almost there.''
Opposition Leader Tony Abbott said the proposed changes would drive up the cost of private health insurance for 2.4million Australians.
''As millions of people leave private health insurance, the cost of that insurance will rise even more and put further pressure on our public hospital system,'' Mr Abbott said.
The private health insurance lobby yesterday issued research which challenges the government's claim that a failure to pass the rebate changes would cost taxpayers about $100billion over 40 years.
A report by Booz and Company for Private Healthcare Australia said 40-year projections could not be relied upon because they did not consider many qualitative variables and events which could occur.
Private Healthcare Australia chief executive Michael Armitage said he would try to speak with crossbench MPs about the proposed means test in the lead-up to a vote in the House of Representatives.
Dr Armitage said the change would drive people out of private health insurance, adding pressure to public hospital waiting list.
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