Modernizing the Australian Taxation Office (ATO)

Accuracy of self‐reported private health insurance coverage

“…Specifically, in the Australian tax filling system, it is compulsory for all tax filers to complete a PHI section asking about their PHI coverage, among other details (see ATO (2015) for an example of a paper-based tax return form). Furthermore, health insurance providers are legally mandated to provide PHI information of their customers to the ATO and, as in the financial year 2014-15, this information was automatically pre-filled for 97% of tax filers who lodged their tax returns online or via their agents (ATO, 2022). The fact that the linked administrative PHI coverage measure is provided by a third party (i.e., insurance providers) and this measure is automatically linked for almost all tax filers alleviate a concern that tax filers may incorrectly report their PHI coverage status in the administrative data.…”

“…Other survey data sources include Household, Income and Labor Dynamics in Australia(Bilgrami et al, 2021;Buchmueller et al, 2021;Cheng, 2014;Kettlewell, 2019a) and the 45-and-Up Study(Doiron et al, 2014;Johar & Savage, 2012;Kettlewell et al, 2018). A few Australian studies have used data from PIT, the same data source as one of our data sources, to document PHI enrollment(Kettlewell & Zhang, 2021;Liu & Zhang, 2022;Stavrunova & Yerokhin, 2014).5 An appropriate level of cover must have an excess of $750 or less for singles and $1500 or less for couples or families(ATO, 2022). "Ancillary" cover, also known as "extra", which covers items such as optical, dental and physiotherapy or chiropractic treatment, is not private patient hospital cover.6 Type of cover is derived from responses to a question asking "Which best describes what [your/his/her] private health insurance covers?".…”