Bupa in new hospital funding deal as Ramsay standoff goes on

BRITISH health insurance giant Bupa has extended its hospital funding agreement with Epworth Healthcare – its third in as many months – despite failing to break its stalemate with Australia’s biggest private hospital provider, Ramsay.

Bupa and Ramsay have been unable to reach a new funding deal, with their existing agreement set to expire on August 2. If the dispute is not resolved by then, Bupa members have been warned they will face out-of-pocket costs if they are treated at a Ramsay hospital.

It is understood Bupa has offered a funding increase of about 1.5 per cent, while Ramsay is looking for a figure closer to matching hospital costs, which have risen about 7 per cent.

Despite failing to strike a fresh agreement, Bupa has successfully extended its contracts with Ramsay’s smaller rivals – Melbourne-based Cabrini, Mater Health and now Epworth, which is Victoria’s largest not-for-profit hospital group with sizeable operations in Melbourne’s inner east and Geelong.

Those agreements have involved funding more out-ofhospital services, and expanding rehabilitation in patients’ homes beyond traditional areas such as orthopaedics to neurological and reconditioning.

Epworth Group chief executive Lachlan Henderson said the renewed partnership with Bupa allowed for greater choice while maintaining access to high-quality care.

“Innovative programs such as rehab in the home are already providing great clinical and personal outcomes for patients, with these services now available to more Bupa patients,” Dr Henderson said.

“Our rehab in the home service doubled as people became accustomed to working and schooling from home during the pandemic, and we’re seeing demand continue. We know our patients love the flexibility of receiving therapy at home as it fits in with their lifestyles.”

Hundreds of millions of dollars have been wiped off private hospital earnings, with the pandemic-enforced elective surgery restrictions costing Ramsay $196.2m, including $89.2m in the three months to March 31.

Meanwhile, net profit across Australia’s entire private health insurance sector soared from $952m to $2bn in the year to March 31, according to Australian Prudential Regulation Authority data.