Insurers accused of 'playing people for mugs'

The Advertiser

4 days ago

Health insurers are spending more but leaving Australians with higher out-of-pocket expenses, sparking scorn from private hospitals.
A record $12.3 billion was dished out by private health insurers in the year to March, according to official data released on Friday.
But the same data shows the average Australian is paying $470.80 per hospital visit, about $46 more than a year earlier.
The average gap for general treatments rose $3 to $61.64 per service.
Insurers also covered less for services like accommodation, nursing, medical services and medical devices in the March quarter, compared with the December quarter.
Private hospitals - already suffering workforce shortages and rising costs for supplies - say insurers were being unfair to patients by allowing gaps to increase.
"Welcome to private health insurance in the modern era, too tricky by half in trying to play people for mugs," Australian Private Health Association chief executive Brent Heffernan said.
"If it costs me $10 to provide a service and you pay me $8, I'm $2 out of pocket.
"Next year it costs me $15 to provide that service and you pay me $10, so I'm even worse off despite you paying me more than you did last year."
Insurers say they are spending $61 more per person from last year to this year.
This is despite technology and changing clinical practice meaning people have shorter hospital stays.
They laid the blame for higher out-of-pocket claims on specialist doctors, whose consultations cannot be covered by health insurers.
"Several trends have been dampening demand for private hospital care, including the high cost to see a specialist doctor in the community," Private Healthcare Australia chief executive Rachel David said.
"A 7.7 per cent increase year-on-year is a good result for private hospitals that have had a hard time due to the pandemic and inflation."
Almost 12.5 million people in Australia have hospital cover, or about 45 in every 100 people.
About 15.1 million have general treatment cover.
More than 81,000 people signed up for hospital cover in the first three months of 2025, with the largest increase coming from 40-44 year olds.
The data from the financial regulator comes after the collapse of major hospital operator Healthscope after lenders voted to stop support for their parent company Brookfield.
Healthscope treats 650,000 patients a year and has 19,000 staff across 37 hospitals in the nation.
Insurers say they are optimistic the private system won't crumble.
"We have a good supply of private hospital services across most parts of the country, so we are confident people with hospital cover will retain access to high-quality services near their homes," Dr David said.
The Commonwealth Bank threw Healthscope a $100 million lifeline while fellow lender Westpac pledged to help the company sell to a new owner.
Health insurers are spending more but leaving Australians with higher out-of-pocket expenses, sparking scorn from private hospitals.
A record $12.3 billion was dished out by private health insurers in the year to March, according to official data released on Friday.
But the same data shows the average Australian is paying $470.80 per hospital visit, about $46 more than a year earlier.
The average gap for general treatments rose $3 to $61.64 per service.
Insurers also covered less for services like accommodation, nursing, medical services and medical devices in the March quarter, compared with the December quarter.
Private hospitals - already suffering workforce shortages and rising costs for supplies - say insurers were being unfair to patients by allowing gaps to increase.
"Welcome to private health insurance in the modern era, too tricky by half in trying to play people for mugs," Australian Private Health Association chief executive Brent Heffernan said.
"If it costs me $10 to provide a service and you pay me $8, I'm $2 out of pocket.
"Next year it costs me $15 to provide that service and you pay me $10, so I'm even worse off despite you paying me more than you did last year."
Insurers say they are spending $61 more per person from last year to this year.
This is despite technology and changing clinical practice meaning people have shorter hospital stays.
They laid the blame for higher out-of-pocket claims on specialist doctors, whose consultations cannot be covered by health insurers.
"Several trends have been dampening demand for private hospital care, including the high cost to see a specialist doctor in the community," Private Healthcare Australia chief executive Rachel David said.
"A 7.7 per cent increase year-on-year is a good result for private hospitals that have had a hard time due to the pandemic and inflation."
Almost 12.5 million people in Australia have hospital cover, or about 45 in every 100 people.
About 15.1 million have general treatment cover.
More than 81,000 people signed up for hospital cover in the first three months of 2025, with the largest increase coming from 40-44 year olds.
The data from the financial regulator comes after the collapse of major hospital operator Healthscope after lenders voted to stop support for their parent company Brookfield.
Healthscope treats 650,000 patients a year and has 19,000 staff across 37 hospitals in the nation.
Insurers say they are optimistic the private system won't crumble.
"We have a good supply of private hospital services across most parts of the country, so we are confident people with hospital cover will retain access to high-quality services near their homes," Dr David said.
The Commonwealth Bank threw Healthscope a $100 million lifeline while fellow lender Westpac pledged to help the company sell to a new owner.
Health insurers are spending more but leaving Australians with higher out-of-pocket expenses, sparking scorn from private hospitals.
A record $12.3 billion was dished out by private health insurers in the year to March, according to official data released on Friday.
But the same data shows the average Australian is paying $470.80 per hospital visit, about $46 more than a year earlier.
The average gap for general treatments rose $3 to $61.64 per service.
Insurers also covered less for services like accommodation, nursing, medical services and medical devices in the March quarter, compared with the December quarter.
Private hospitals - already suffering workforce shortages and rising costs for supplies - say insurers were being unfair to patients by allowing gaps to increase.
"Welcome to private health insurance in the modern era, too tricky by half in trying to play people for mugs," Australian Private Health Association chief executive Brent Heffernan said.
"If it costs me $10 to provide a service and you pay me $8, I'm $2 out of pocket.
"Next year it costs me $15 to provide that service and you pay me $10, so I'm even worse off despite you paying me more than you did last year."
Insurers say they are spending $61 more per person from last year to this year.
This is despite technology and changing clinical practice meaning people have shorter hospital stays.
They laid the blame for higher out-of-pocket claims on specialist doctors, whose consultations cannot be covered by health insurers.
"Several trends have been dampening demand for private hospital care, including the high cost to see a specialist doctor in the community," Private Healthcare Australia chief executive Rachel David said.
"A 7.7 per cent increase year-on-year is a good result for private hospitals that have had a hard time due to the pandemic and inflation."
Almost 12.5 million people in Australia have hospital cover, or about 45 in every 100 people.
About 15.1 million have general treatment cover.
More than 81,000 people signed up for hospital cover in the first three months of 2025, with the largest increase coming from 40-44 year olds.
The data from the financial regulator comes after the collapse of major hospital operator Healthscope after lenders voted to stop support for their parent company Brookfield.
Healthscope treats 650,000 patients a year and has 19,000 staff across 37 hospitals in the nation.
Insurers say they are optimistic the private system won't crumble.
"We have a good supply of private hospital services across most parts of the country, so we are confident people with hospital cover will retain access to high-quality services near their homes," Dr David said.
The Commonwealth Bank threw Healthscope a $100 million lifeline while fellow lender Westpac pledged to help the company sell to a new owner.
Health insurers are spending more but leaving Australians with higher out-of-pocket expenses, sparking scorn from private hospitals.
A record $12.3 billion was dished out by private health insurers in the year to March, according to official data released on Friday.
But the same data shows the average Australian is paying $470.80 per hospital visit, about $46 more than a year earlier.
The average gap for general treatments rose $3 to $61.64 per service.
Insurers also covered less for services like accommodation, nursing, medical services and medical devices in the March quarter, compared with the December quarter.
Private hospitals - already suffering workforce shortages and rising costs for supplies - say insurers were being unfair to patients by allowing gaps to increase.
"Welcome to private health insurance in the modern era, too tricky by half in trying to play people for mugs," Australian Private Health Association chief executive Brent Heffernan said.
"If it costs me $10 to provide a service and you pay me $8, I'm $2 out of pocket.
"Next year it costs me $15 to provide that service and you pay me $10, so I'm even worse off despite you paying me more than you did last year."
Insurers say they are spending $61 more per person from last year to this year.
This is despite technology and changing clinical practice meaning people have shorter hospital stays.
They laid the blame for higher out-of-pocket claims on specialist doctors, whose consultations cannot be covered by health insurers.
"Several trends have been dampening demand for private hospital care, including the high cost to see a specialist doctor in the community," Private Healthcare Australia chief executive Rachel David said.
"A 7.7 per cent increase year-on-year is a good result for private hospitals that have had a hard time due to the pandemic and inflation."
Almost 12.5 million people in Australia have hospital cover, or about 45 in every 100 people.
About 15.1 million have general treatment cover.
More than 81,000 people signed up for hospital cover in the first three months of 2025, with the largest increase coming from 40-44 year olds.
The data from the financial regulator comes after the collapse of major hospital operator Healthscope after lenders voted to stop support for their parent company Brookfield.
Healthscope treats 650,000 patients a year and has 19,000 staff across 37 hospitals in the nation.
Insurers say they are optimistic the private system won't crumble.
"We have a good supply of private hospital services across most parts of the country, so we are confident people with hospital cover will retain access to high-quality services near their homes," Dr David said.
The Commonwealth Bank threw Healthscope a $100 million lifeline while fellow lender Westpac pledged to help the company sell to a new owner.