Station: ABC Radio Brisbane
Program: Breakfast
Date: 3/4/2023
Time: 7:25 AM
Compere: Craig Zonca and Loretta Ryan
Interviewee: Dr Rachel David, CEO, Private Healthcare Australia


LORETTA RYAN: Let’s bring in Dr Rachel David, Chief Executive of Private Healthcare Australia. Good morning, Dr David.
LORETTA RYAN: We’re seeing that there are new memberships in the private health arena. So why does Queensland though, have a lower private health coverage than other states?
RACHEL DAVID: Look, we have seen new memberships. We’ve seen about 160,000 people join a health fund in Queensland over the last eight quarters or two years. So membership is growing in Queensland and coming back and I think Minister D’Ath actually hit the nail on the head when she said that it was due to the decentralised nature of Queensland. It’s a historical thing so that compared to other states, Queensland is much more spread out across a number of small towns than other states. And traditionally in those towns they haven’t had private hospitals. Now, health funds- some health funds these days are able to offer to cover transport and accommodation for people living in rural areas so they can come and have their treatment in the city. And so for people in small towns, it is worth actually checking that out to see if that option is available.
CRAIG ZONCA: Rachel, one of the big issues is premiums keep rising but the gap also keeps expanding. What’s going on here? What’s broken and why are we still left with such big out of pocket expenses?
RACHEL DAVID: Look, there are a couple of issues here. Premiums are rising, but health funds are doing everything they can to keep that rate under inflation. So the last premium increase was around an average of 2.9 per cent, which was under inflation of 7.8 last year. So they did a lot to try and keep a lid on that. But when it comes to inflation, it does affect the health sector as well and health funds do have to pay for frontline workers, the cost of power, and food in hospitals. So it does have to go up, unfortunately, the same as other things. I can reassure you that a number of regulators, the Health Department and APRA, which is an insurance regulator, are involved in that process. So they’re absolutely clear that that money is going to paying for hospitals. It’s not being stuffed under the mattress somewhere. But it- unfortunately, inflation does affect the health sector as well as the rest of the economy. Now, when it comes to the gap cover, for the most part, the biggest part of the premium is care in a hospital. That’s the biggest expense. And that is by far almost 100 per cent covered in all cases by the health fund. Where you get gaps is when it comes to- for the most part, it’s against the doctor’s fee or medical specialist fees and unfortunately, under the Australian Constitution, neither the Commonwealth, the state governments, or any other payer, be it a private health insurance or another payer, can tell the doctor what they are allowed to charge. That is completely up to them. The health funds do provide some level of gap cover and a number of specialists do the right thing and don’t charge their patients any more than that so that their gaps remain low. But one of the problems that we have in Australia is that in out-patients, if you see a specialist in the community, health funds are not allowed to pay for that gap.
CRAIG ZONCA: [Interrupts] Aren’t allowed to?
RACHEL DAVID: No, they are not allowed to. So if you see your specialist as an out-patient or in the community, like I think one of the people who commented said, we can’t do anything about that because under the Medicare legislation, only the Commonwealth Government can pay.
CRAIG ZONCA: Do you think that should change?
RACHEL DAVID: Well, look, I think we need to look at the whole system and about some of the pressures on consumers. The system that we have which bolted private health insurance into Medicare as part of the system was designed in the seventies and eighties, and we don’t even have the same diseases now. I mean, I think the Minister was talking about the fact we’ve got a number of extremely elderly people with chronic diseases that are in hospital, and we need to adjust the system to managing for chronic disease. So, yes, the health funds would like to pay for more care in the community and more specialist care in the community, but there are these outdated regulations that are stopping that. And I think we do need to look at this again with our Commonwealth co-funders and our colleagues to see if we can do this in a more effective way.
CRAIG ZONCA: Yeah, and that’s certainly the message we’re getting on the text line. Can it be made to be more effective? Rachel, thanks for your time this morning.
CRAIG ZONCA: Dr Rachel David, the CEO of Private Health Care Australia.
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