Delay Product Categorisation Changes

Reports today in The Australian (“Health insurance reforms may miss April 1 start date”) claim the planned start date for the new product categorisation could be delayed as private health insurers call for a 24-month transition.

The Medical Technology Association of Australia (MTAA), has also raised concerns around the product categorisation issue of gold, silver, bronze and basic policies.

In early September MTAA proposed a delay in the implementation of reforms which was rejected by the peak bodies, Private Healthcare Australia (PHA) and Members Health Fund Alliance.

Now we find both peak bodies are championing what MTAA has been calling for.

MTAA is on the record as supporting the intent of the Federal Government’s reforms to Private Health Insurance to deliver greater transparency for consumers and to make private health insurance more attractive and affordable for policyholders.

However, there are serious concerns around the proposed categorisations that would negatively impact on consumers, leaving them worse off compared to the current system.

It proposes restricting coverage for some surgical interventions that consumers commonly rely on such as spinal fusion, joint replacements, insulin pumps (for which there is no public hospital alternative), pain therapies such as spinal cord stimulation, hearing implants and intraocular lenses.

Under the proposed model, all of these procedures would require the highest and presumably most expensive level of cover despite many of these procedures being available today to people holding lower levels of cover.

Recently, the Australian Orthopaedic Association, Pain Australia, Spine Society and the Neuromodulation Society of Australia New Zealand have all publicly claimed patients would be worse off by the proposed changes.

This could lead to a further decline in the numbers of people with PHI coverage. 

There is a risk that more pressure will be placed upon an already over stretched public hospital system for elective surgery and increased waiting lists will result for common procedures such as joint replacements.

The Private Health Insurance Rules have yet to be tabled which would give effect to the new categorisations and standardised clinical definitions.  This is a matter of serious concern with many stakeholders in the dark. 

Ian Burgess, Chief Executive Officer of the Medical Technology Association of Australia said:

“The clock is winding down and with every day that goes by the uncertainty for consumers increases.

“MTAA is calling for a 12-months delayed implementation so consumers can be better informed about the proposed changes.

“We’ve expressed to the Health Minister our concerns that insurers will choose to no longer offer certain services, like spinal fusion, joint replacement, chronic pain or cataracts, on the lower categories.

“This could lead to a further reduction in the number of people with private health insurance or a reduction in the number of people covered by effective health insurance that properly covers them for their needs. In either case there is a risk that further burden would be placed upon public health services for elective surgery and increased waiting lists for common procedures such as joint replacements.

“We believe access to a full range of medical technology is the most valuable component of a private health insurance policy and we’re committed to doing what we do best – assist patients lead healthier and more productive lives.”

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