Hospi­tal billing re­view scrapped


The states have aban­doned their bid to chal­lenge fed­eral ev­i­dence of pub­lic hos­pi­tals “har­vest­ing” pri­vately in­sured pa­tients, paving the way for fed­eral Health Min­is­ter Greg Hunt to pur­sue longde­bated re­forms.

Pub­lic hos­pi­tals bill more than $1.1 bil­lion in treat­ment to health in­sur­ers each year, off­set­ting costs that would nor­mally have to be cov­ered un­der state bud­gets.

Pa­tients are even of­fered pri- vate rooms and other perks to be treated pri­vately.

Mr Hunt and health funds have ac­cused the states of cost­shift­ing and driv­ing up in­sur­ance pre­mi­ums for treat­ment pub­lic hos­pi­tals are oth­er­wise obliged to give pa­tients with­out charge.

The states in­sist the prac­tice is le­gal, helps pub­lic hos­pi­tals re­cruit spe­cial­ists, and gives health-fund mem­bers an op­tion in ar­eas where there is no pri­vate hospi­tal.

At a Coun­cil of Aus­tralian Gov­ern­ments Health Coun­cil meet­ing in Au­gust the states ar­gued that af­ford­abil­ity is­sues in the pri­vate sec­tor were to blame for the in­creas­ing num­ber of mem­bers be­ing treated in pub­lic hos­pi­tals. The meet­ing agreed to “com­mis­sion an in­de­pen­dent re­view of a range of fac­tors re­gard­ing util­i­sa­tion of pri­vate health in­sur­ance in pub­lic hos­pi­tals”.

South Aus­tralian Health Min­is­ter Stephen Wade at the time said there was a need to “get a bet­ter un­der­stand­ing” of the prac­tice.

But with the re­view due to have been com­pleted by this month, and sources sug­gest­ing it had been aban­doned, Mr Wade’s spokes­woman would only say “the progress of the re­view is a mat­ter for the COAG Health Coun­cil”.

A spokes­woman for Mr Hunt yes­ter­day con­firmed the re­view had not been un­der­taken, say­ing: “Sig­nif­i­cant progress on the draft­ing of the 2020-25 Na­tional Health Re­form Agree­ment has meant that the states and ter­ri­to­ries, in con­sul­ta­tion with the com­mon­wealth, have de­ter­mined that the re­view is no longer nec­es­sary.”

It was un­clear yes­ter­day what that progress en­tailed. A heads of agree­ment put for­ward by Mr Hunt a year ago, set­ting the pa­ram­e­ters for ne­go­ti­a­tions, has yet to be signed by Queens­land and Vic­to­ria. Those states are con­test­ing pub­lic hospi­tal fund­ing rec­on­cil­i­a­tions from pre­vi­ous years.

The heads of agree­ment re­quires gov­ern­ments to note the long-di­min­ished Medi­care prin­ci­ple that only pub­lic pa­tients treated free of charge are pri­ori­tised ac­cord­ing to clin­i­cal need. Con­cerns have been raised that pub­lic hos­pi­tals may fast-track pri­vate pa­tients for fi­nan­cial rea­sons. Any re­forms talks are likely to fo­cus on whether pa­tients should be asked their in­sur­ance sta­tus in emer­gency de­part­ments, as now oc­curs, and the ra­tio­nale pro­vided by hospi­tal staff.

The heads of agree­ment seeks to “en­sure the fi­nal agree­ment sup­ports ac­cess to pub­lic hospi­tal ser­vices by all pa­tients on the ba­sis of clin­i­cal need”.

Pub­lic hos­pi­tals have been spend­ing or for­go­ing tens of mil­lions of dol­lars a year through cov­er­ing mem­bers’ ex­cess and front-end-de­ductible pay­ments so there are no gap fees.

How­ever, they will be fi­nan­cially more ex­posed from April, when the max­i­mum per­mit­ted ex­cess will rise from $500 to $750 for sin­gles, and from $1000 to $1500 for cou­ples and fam­i­lies.

Gov­ern­ment doc­u­ments sug­gest “pub­lic hos­pi­tals that con­tinue to waive the ex­cess will face re­duced rev­enue, and will there­fore have a slightly re­duced in­cen­tive to con­tinue with their poli­cies of en­cour­ag­ing pa­tients to elect to be treated as pri­vate pa­tients”.

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