“We all know that our existing healthcare system has broken parts. Mostly because of our population size, tax take, geographic stretch etc.,” Smee wrote on LinkedIn.

“So, for those that can afford the premiums, and therefore take the pressure of the public system, how about making the premium tax deductible?” he asked.

“We can claim donations, income protection and interest on property investment so why not private medical insurance.”

But insurance agents don't think it's likely the current government would even consider making premiums tax deductible.

Graeme Lindsay of industry research organisation Strategy Financial says lobbying for tax deductibility would be “like shovelling water uphill with a pitch fork.”

The main reason why the cause is hopeless is because it would take many years before the private sector it was of sufficient size to relieve the pressure on the public system, he says.

But the government would suffer an immediate drain on its tax take at a time when it's short of cash and trying to reduce the “profligate over-spending” of the previous government, Lindsay says.

Willowgrove Consulting's Jon-Paul Hale says: “We have to be careful what we wish for.”

He notes that about 25% of New Zealand's population already has health insurance and giving them a tax break would immediately reduce government revenue, adding to the public health system's funding shortfall without impacting demand.

“We know from past tax deductibility that the impact is limited as people without means wouldn't take up medical insurance because of the tax break,” Hale says.

And while some middle income people might take on health insurance with a tax incentive, it's likely to be only a single-digit percentage of the population, he says.

How to treat businesses which offer employees health insurance would also be a complicated and thorny issue – businesses currently can deduct the costs of a group scheme but pay fringe benefits tax on the benefit provided, or they can make it part of a salary package and deduct tax at the employee's marginal tax rate.

“The bulk of medical insurance when it was last tax deductible was in employer group schemes and this meant that corporates benefited the most.”