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| Private health insurance: low-value policies ‘increased dramatically’, report finds | Private health insurance: low-value policies ‘increased dramatically’, report finds |
| (30 days later) | |
| Senate committee inquiry finds exclusions for eye surgery, dental services and maternity care creating unnecessary stress | |
| Melissa Davey | |
| Tue 19 Dec 2017 06.52 GMT | |
| Last modified on Tue 19 Dec 2017 06.55 GMT | |
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| Australians with private health insurance are increasingly being offered low-value policies, with exclusions for essential services such as eye surgery, dental services and maternity care creating unnecessary stress to patients. | Australians with private health insurance are increasingly being offered low-value policies, with exclusions for essential services such as eye surgery, dental services and maternity care creating unnecessary stress to patients. |
| This was one of the findings from a Senate committee inquiry into the affordability and value of private health insurance, which published its final report on Tuesday. | This was one of the findings from a Senate committee inquiry into the affordability and value of private health insurance, which published its final report on Tuesday. |
| “The number of policies with exclusions or co-payments has increased dramatically in recent years,” the report found. “Hospitals Australia noted that the rise in exclusions can lead to unnecessary stress for policy holders when they require care, particularly if exclusions in a policy are not properly explained.” | “The number of policies with exclusions or co-payments has increased dramatically in recent years,” the report found. “Hospitals Australia noted that the rise in exclusions can lead to unnecessary stress for policy holders when they require care, particularly if exclusions in a policy are not properly explained.” |
| According to the Australian Prudential Regulation Authority (APRA) data, the number of people covered by exclusionary policies increased from 7% in June 2007 to 40% in 2017. | According to the Australian Prudential Regulation Authority (APRA) data, the number of people covered by exclusionary policies increased from 7% in June 2007 to 40% in 2017. |
| The report quoted a patient with breast cancer who told the inquiry about the stress she experienced when her cancer treatment was not fully covered. | The report quoted a patient with breast cancer who told the inquiry about the stress she experienced when her cancer treatment was not fully covered. |
| “I queried the gap with the private health fund and they said to me, ‘Well you’ve got the wrong surgeon’,” the patient told the inquiry. “I said, ‘Well when you’re told you’ve got breast cancer, you don’t say hold on a minute, I’ll go find another surgeon’. You’re sort of overwhelmed by the diagnosis and you want to get the treatment. I had confidence in him [the surgeon] but not in his bills. It was a lot of money we weren’t expecting to pay.” | “I queried the gap with the private health fund and they said to me, ‘Well you’ve got the wrong surgeon’,” the patient told the inquiry. “I said, ‘Well when you’re told you’ve got breast cancer, you don’t say hold on a minute, I’ll go find another surgeon’. You’re sort of overwhelmed by the diagnosis and you want to get the treatment. I had confidence in him [the surgeon] but not in his bills. It was a lot of money we weren’t expecting to pay.” |
| The Council on the Ageing noted that the elderly were particularly susceptible to unexpected out-of-pocket costs. | The Council on the Ageing noted that the elderly were particularly susceptible to unexpected out-of-pocket costs. |
| “A recurring story … is older people having maintained [private health insurance] for decades, only to find when they need to draw on it in later life they cannot realise the benefits because they cannot afford to meet the co-payments or other out-of-pocket costs associated with a procedure or treatment,” the council told the inquiry. | “A recurring story … is older people having maintained [private health insurance] for decades, only to find when they need to draw on it in later life they cannot realise the benefits because they cannot afford to meet the co-payments or other out-of-pocket costs associated with a procedure or treatment,” the council told the inquiry. |
| The Senate committee recommended the health minister, Greg Hunt, require private health insurers to publish all rebates by policy and item number, and that he instruct the health department to publish the fees of individual surgeons in a searchable database. | The Senate committee recommended the health minister, Greg Hunt, require private health insurers to publish all rebates by policy and item number, and that he instruct the health department to publish the fees of individual surgeons in a searchable database. |
| There should also be increased transparency around commissions from the private health insurance industry received by intermediaries selling health insurance on behalf of private health insurance organisations, the committee found. It also called on the commonwealth government to amend legislation to require all private health insurers disclose executive remuneration and other administrative costs. | There should also be increased transparency around commissions from the private health insurance industry received by intermediaries selling health insurance on behalf of private health insurance organisations, the committee found. It also called on the commonwealth government to amend legislation to require all private health insurers disclose executive remuneration and other administrative costs. |
| The chief executive of the Australian Healthcare and Hospitals Association, Alison Verhoeven, said the recommendations were “sound” and should be implemented. | The chief executive of the Australian Healthcare and Hospitals Association, Alison Verhoeven, said the recommendations were “sound” and should be implemented. |
| “It has made wide-ranging recommendations aimed at improving value, transparency related to out-of-pocket costs, clarity of information for consumers and choice of service providers,” she said. | “It has made wide-ranging recommendations aimed at improving value, transparency related to out-of-pocket costs, clarity of information for consumers and choice of service providers,” she said. |
| “Only when service providers and insurers address these issues will private health insurance represent better value for consumers, and better value for taxpayers who currently subsidise private health insurance companies to the tune of $6.4bn per annum.” | “Only when service providers and insurers address these issues will private health insurance represent better value for consumers, and better value for taxpayers who currently subsidise private health insurance companies to the tune of $6.4bn per annum.” |
| She said the association particularly supported the recommendation that state and territory governments review policies and practices to ensure that all patients could provide informed financial consent. | She said the association particularly supported the recommendation that state and territory governments review policies and practices to ensure that all patients could provide informed financial consent. |
| “This should be further extended to ensure that all health service providers, both hospitals and clinicians, provide adequate information to patients to enable informed financial consent,” Verhoeven said. “Too many people have received unpleasant surprises regarding out-of-pocket costs for their healthcare and this must be addressed.” | “This should be further extended to ensure that all health service providers, both hospitals and clinicians, provide adequate information to patients to enable informed financial consent,” Verhoeven said. “Too many people have received unpleasant surprises regarding out-of-pocket costs for their healthcare and this must be addressed.” |
| She said all patients should be treated on the basis of clinical need and not on the basis of insurance status. | She said all patients should be treated on the basis of clinical need and not on the basis of insurance status. |
| The CEO of the Consumers Health Forum, Leanne Wells, said she agreed with the report’s finding that the government should consider extending private cover in some circumstances for services outside of hospital. But she said this should be done only on the proviso that the universality of Medicare would not be undermined and costs would not be inflated. | The CEO of the Consumers Health Forum, Leanne Wells, said she agreed with the report’s finding that the government should consider extending private cover in some circumstances for services outside of hospital. But she said this should be done only on the proviso that the universality of Medicare would not be undermined and costs would not be inflated. |
| “We strongly support many of the committee’s 19 recommendations in this ground-breaking report which recognises that the system must meet the needs of the consumer – those who pay for health insurance policies - and not vice versa,” she said. | “We strongly support many of the committee’s 19 recommendations in this ground-breaking report which recognises that the system must meet the needs of the consumer – those who pay for health insurance policies - and not vice versa,” she said. |
| Health | |
| Private health insurance | |
| Coalition | |
| Greg Hunt | |
| Australian politics | |
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