The Australian Healthcare and Hospitals Association has called on Health Minister Sussan Ley to urgently add public hospital representation to her new Private Health Ministerial Advisory Committee if it’s starting to discuss how public hospitals are run and funded.
AHHA chief executive Alison Verhoeven responded with alarm to a report that the Committee has “unexpectedly” put the practice of public hospitals billing health insurers for the cost of treating members under priority review.
The news came as the two largest private hospitals separately tried to up the ante on private health insurers, floating a proposal for medical savings accounts as an alternative to insurance – a move Grattan Institute health director Stephen Duckett described as “an ambit claim”.
The Australian‘s health journalist Sean Parnell has reported that the issue of public hospitals billing health insurers is one of only four that have been set a February deadline for the Committee – the others being private hospital contracting arrangements, minimum standards for PHI policies in Gold, Silver and Bronze categories, and improved value for rural consumers.
Parnell says that Ley has been under increasing pressure to intervene on the issue, with Private Healthcare Australia and the Australian Private Hospitals Association arguing the practice pushes up premiums.
In a statement, Verhoeven said the right of privately-insured hospital patients to choose their own doctor, whether in a private or public hospital, should not be tampered with.
‘Currently about $1 billion of the $14 billion or so paid out by health insurers every year is to public hospitals for treating privately-insured patients as private patients within public hospitals.
‘What the private insurers and private health industry want is that they not be billed for those services, and that governments pick up the tab. But to do that you would have to remove the patient’s right to choose their doctor in a public hospital as well as the right to choose where they are treated.
‘It’s crystal clear in the Australian Government’s own Private Patients Hospital Charter that as a private patient you have the right to choose your own doctor and to decide whether you will go to a public or private hospital that your doctor attends. You also have the right to choose to be treated as a public patient in a public hospital, at no charge, by a doctor appointed by the hospital.
Verhoeven also called on the Health Minister to ensure the Private Health Ministerial Advisory Committee has representation from the public sector by its next meeting in November if this was on the agenda.
She said that members of the committee from private health insurance and private healthcare industries are not willing to put funds towards services provided by public hospitals “but are quite happy that the majority of their doctors and nurses were trained in the public system at no cost to them, to say nothing of the $6 billion a year the government spends subsidising private health insurance.” She said:
‘The Committee’s efforts would be better focused on getting rid of junk insurance policies, including policies which cover non-evidence based treatments like homeopathy and massage, rather than trying to limit the rights of Australians to choose their doctors in public hospitals.’
Meanwhile, the Australian Financial Review has reported that private health groups – led by the country’s two largest hospital operators, Ramsay Health Care and Healthscope – will call on the Health Minister to establish medical savings accounts as an alternative to the $20 billion PHI sector.
The report says the two companies will lobby through their representative on the Private Health Ministerial Advisory Committee for a huge shift in the way hospital visits and ancillary care, like dentistry and optical, is funded. It quotes Ramsay chief executive Chris Rex saying:
“I totally support government getting involved in trying to encourage people to make private choices but I’m not convinced that health insurance is the right horse to back any more.”
Rex is also quoted as saying that private health insurance is the weak link in Australia’s health care system.
“If the business model of health insurance is so unattractive that it requires a huge government subsidy every year and a taxation regime to coerce people to buy your product, it tends to suggest it’s pretty weak.”
Croakey readers might be interested to listen to this Radio National interview with Grattan Institute health program director Stephen Duckett on how private health has been “lobbying at 40 paces” on the issue in Canberra.
Duckett said he viewed the proposal as an “ambit claim” from private hospitals in response to private health insurers beginning to tight up on contractual arrangements, saying hospitals would prefer to negotiate directly with private health patients “who have no power”.
Meanwhile, Fairfax has reported that the Private Health Insurance Ombudsman received 4416 complaints in 2015-16, nearly double the number a decade ago.