AMA President calls for investigation into private health insurance industry


The Australian Medical Association (AMA) President Dr Michael Gannon has used his first National Press Club address to call on regulators and the government to investigate the actions of the private health insurance industry.

Dr Gannon took aim at health insurers accusing them of actions reflecting “that their ultimate accountability is to their shareholders”.

“If the actions of the funds continue unchecked and uncontested – especially their aggressive negotiations with hospitals and their attacks on the professionalism of doctors - we will inevitably see US-style managed care arrangements in place in Australia.

“Putting profits ahead of patients is not the Australian way, and the funds will lose friends very quickly.

“And it won’t be just hospitals and doctors. Policy holders will not be happy customers. This is already happening, stacking more pressure on the Mutual funds.

“It's a worrying trend that demands greater interest from government and from regulators.

Already this year we've seen the ACCC initiate action in the Federal Court against Medibank Private for what it states to be misleading and unconscionable conduct,” he said.

His comments were endorsed by Australian Private Hospitals Association (APHA) CEO Mr Michael Roff who said APHA and the AMA are closely aligned on the issue of private health insurance.

“Dr Gannon raised a number of issues in his speech that reflect concerns APHA has had for some time. There have been a number of concerning incidents lately with the private health insurers misrepresenting data to make a point and of course the investigation by ACCC.

“He has also supported the case APHA has been making for some time that Australians need better value for money from their health insurance policies. APHA has continued to argue on behalf of consumers for changes to health insurance products and the end to ‘junk’ policies that offer patients little more than access to the Medicare services they can get for free,” Mr Roff said.

Dr Gannon said moves to reform the private health insurance system had his support.

“Standardising items, and mandating minimum levels of cover, should make choosing a health insurance product easier.

“We are also very pleased that the Government has announced it will be removing ‘junk’ policies from the market.

“Policies designed solely to avoid paying the Medicare Levy Surcharge are detrimental to our health system.

“Policies that limit treatment to public hospitals or contain substantial unfair exclusions do not contribute to universal health care.

“The value proposition of private health is choice of doctor and choice of hospital. Without that, patients may as well be in the public system.”

He said the majority of privately insured medical services are charged at ‘no gap’ while a further 6.4% are charged under ‘known gap’ arrangements.

“This means that less than 8 per cent of privately insured patients are charged fees that exceed that paid by their private health insurance.

“Put simply, the majority of doctors and hospitals understand the impact of gaps on patients and are doing the right thing by them.

“That is why the AMA and the hospitals are unimpressed by recent comments and actions from some of the private health insurers, sadly often the biggest and most profitable ones,“ Dr Gannon said.






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