Calls for better oversight of private health system

AMA National President-elect Dr Michael Bonning said without meaningful reform and an independent body to oversee this reform, patients would continue to pay the price of a private system under strain.

Independent MP Andrew Wilkie tabled a motion in Parliament on October 12 calling for a statutory authority to monitor the financial sustainability of the sector, including premiums, benefit pay outs and regional hospital viability.

It would also provide transparency around contracting arrangements between insurers, hospitals and practitioners to prevent bargaining power imbalances undermining access to care.

“A strong public healthcare system must remain the cornerstone of healthcare in Australia. However, a sustainable private sector also plays a critical role in supporting access to care, reducing pressure on waiting lists and maintaining capacity across the health system,” he said.

“That some private healthcare providers are struggling, while at the same time consumers are often complaining of soaring costs and gaps in services, points to a healthcare system in need of reimagining with much better regulation and oversight.” 

Private hospitals account for more than 40% of all hospital admissions and perform around 70% of planned surgeries in Australia.

Some 13 million Australian’s hold private health insurance but hundreds of thousands are downgrading their cover as its value erodes.

“Take that capacity away and the public system simply won’t be able to absorb it,” Mr Wilkie told Parliament.

He said the warning lights are flashing, pointing to Australian Private Hospitals Association data that shows more than 20 hospitals have closed and more than 80 services have been withdrawn in recent years.

His calls were backed by Independent MP Dr Monique Ryan, the AMA and the Australian Society of Ophthalmologists.

Dr Bonning said the need for an independent body to oversee the sector was more urgent than ever.

“Without meaningful reform of the critical private health sector, and an independent umpire to oversee that reform, Australians will continue to pay the price for a private system weighed down by outdated policy settings, inconsistent rebates, and a public hospital network under significant strain,” he said.

“An independent body would bring together stakeholders to enact urgently needed reforms to safeguard the viability of private healthcare and knit together regulatory functions currently delivered by disparate departments and agencies, while removing government from its conflicted role of regulator and policy maker.”

In WA the private sector has faced several closures and service delivery changes due to costs and workforce pressures.

In September St John of God Murdoch stopped providing a 24/7 emergency department service due to workforce pressures. The department now operates from 8am-10pm.

Private maternity services in the state have faced numerous closures and staff departures in recent years, stoking concern for the viability of the sector.

St John of God Hospital Mount Lawley, St John of God Hospital Bunbury and Glengarry Private Hospital have all seen closures in the past three years.