PHA’s Annual High Claims 2018 Report demonstrates the value of having private health insurance, particularly for younger Australians, but it also highlights the impact medical device costs and long hospital admissions for mental health problems are having on claims (report attached).

The report reflects the latest APRA 2017/18 data that shows prostheses (medical device) benefits paid by private health insurers have increased considerably over the past five years across major disease groups such as cardiac and musculoskeletal procedures (which covers hip and knee, foot and ankle, shoulder and elbow, hand and spine).

Health funds paid more than $6.82 billion in benefits for individual claims (for which the benefit payment exceeded $10,000) during 2017, an increase of 6.6% compared to 2016. Nearly half of all payments for hospital treatment by health funds (46%) are for claims where the benefit payment for the episode of care was more than $10,000.

PHA’s Annual High Claims report analyses the nature and magnitude of high claims paid by health funds over the 12 months to December 2017. The report is collated using data from 37 health funds representing 100% of the private health insurance industry.

In total, health funds paid out on behalf of members 332,331 claims where the benefit payment for the episode of care was more than $10,000, the highest benefit paid being $699,582 for the treatment of a patient with viral encephalitis.

PHA Chief Executive Dr Rachel David said the report highlights the value and contribution of PHI to the lives of individuals, as well as Australia’s broader healthcare system.

“The report clearly shows private hospitals are now dealing with very complex cases like the public hospital system, and these are funded by private health insurance, taking the pressure off public hospitals.

“The report emphasises the importance of health fund membership for young Australians, with more than 17,000 high claims (benefits exceeding $10,000) paid for members under the age of 30 during 2017. This was an increase on the previous year of 1,000 claims (+6.2%).

“Many of these episodes involved hospital stays of more than 100 days for young Australians suffering from mental health issues, cancer and other conditions.

“More than 13.5 million Australians hold PHI and over half of those have disposable incomes under $50,000 per annum. More than 80% believe that they get value for money from their PHI. One of the main reasons for this is peace of mind as well as choice of doctor, choice of hospital, and timing of medical treatment,” said Dr David.