“Greedy” doctors blamed for soaring private health bills

“Greedy” doctors and hidden private hospital fees are being blamed for the rising cost of private health insurance.

Nov 26, 2019, updated Nov 26, 2019
Photo: AAP/Stefan Postles

Photo: AAP/Stefan Postles

Researchers at the Grattan Institute have pinned private health premiums on a handful of high charging doctors, inefficient private hospitals and unnecessary care.

“Private health insurance will continue its death spiral unless excessive private hospital costs and specialist bills are reined in,” their report released on Tuesday said.

“Insurers are in a vice, squeezed between rapidly increasing costs, and consumers – especially the young and the healthy – who baulk at paying premiums that are rising much faster than their incomes.”

Researcher Stephen Duckett said premiums could be cut by 10 per cent if private hospitals focused on treating patients rather than keeping them in longer to recoup more money.

All up, he estimates Australian private health patients could save up to a total of $2 billion per year on their premiums.

Duckett recommends from 2022 private patients get their bill as a single bundle, including the costs of doctors, prostheses, diagnostics and hospital stays.

Private health insurers should pay private hospitals on the basis of a national fee schedule, the same way public hospitals receive government funding.

The report says a small group of specialists were billing patients at more than twice the official fee schedule and often to the surprise of the patient, who had to foot most of the bill.

“The higher fees have nothing to do with the skill of the surgeon … (the) small minority of specialists who charged more than twice the schedule fee are simply greedy,” Duckett said.

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But he also pointed to private hospital patients staying longer than public hospital patient hospitals, as well as insurers paying for unnecessary care.

“The private health insurers should not have to pay for care that is of no or low value to the patient.”

Women were also found to be copping higher out-of-pocket costs and receiving more medical services than those without private health.

The report said navigating private insurance was complex – like receiving multiple bills for a single treatment – making it hard for patients to estimate how much treatment would cost.


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