Private hospitals still struggling, despite health insurance membership increase

DESPITE an uptick in episodes of care in private hospitals, they are still below anticipated numbers considering high private health insurance membership, which could be because Australians are not able to access the care they need because of low value insurance policies says Australian Private Hospitals Association (APHA) CEO Michael Roff.

The latest Australian Prudential Regulation Authority data released today shows there were just over a million episodes of care in private hospitals in the December 2023 quarter, but with 12,092,921 Australians now holding private health insurance, this number should be higher, Mr Roff said.

"While it's good to see episodes of care increasing, meaning private hospitals are getting back to more normal levels of activity, we would have anticipated a higher number considering the number of Australians with private health insurance membership has increased by 859,798 people since the beginning of the COVID-19 pandemic.

"In tandem there has been an increase in private health insurance policies with exclusions, more than two-thirds (64.3 percent) have them, which means Australians may not be covered for a health service they find they need. We are notoriously bad at understanding our healthcare needs even six months in advance and people often find their health insurance does not pay for services they thought they were covered for.

"Despite the fact these junk policies provide little cover to Australians, insurers continue to provide them."

Mr Roff said there are a number of other pressures impacting the private hospital sector.

"In addition, the economic environment means private hospitals are under significant financial pressure and unless the boom in health insurance profitability flows into appropriate funding for private hospital services, the sector will continue to struggle.

"Just this week Private Healthcare Australia CEO Dr Rachel David issued a press release in which she pointed to premiums having to increase 'to ensure our health providers are appropriately remunerated for increases in
recruitment, power and food because like the rest of the economy, they have been impacted by inflation.' This is true, yet there is little evidence of private health insurance companies increasing their payments to private hospitals.

"We have already seen private hospital beds, services, and indeed entire hospitals close and the current funding arrangements need to change if we want this to stop," Mr Roff said.

-ENDS-

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