Private health insurers make no apologies: CEO

PRIVATE health insurers have a responsibility to their 13.7 million members to advocate on their behalf for quality and safety in health care. Health costs are rising, the population is ageing and there is an increasing demand for the best available health services; therefore, health insurers are also obliged to do what can reasonably be done to reduce waste and help keep premiums affordable for those Australians who choose to contribute to the cost of their own health care.

This is simply common sense and all about maintaining the balance and sustainability of our world-class mixed private/public health system. It has nothing to do with influencing clinical decision-making.

In a recent edition of InSight+, Stephen Milgate AM has again raised the bogeyman of private health insurance seeking to introduce “managed care” into Australia. Based on a 1993 policy document, we are accused of seeking to introduce the worst kind of managed care – “US-style” – into Australia.

Let me make one point crystal clear: private health insurers want clinical decisions made by doctors.

US-style managed care, which refers to the health system in the US in the 1990s where health funds employed doctors and pre-approved claims, is not and will not be an option in Australia. The US health system is hideously expensive, inequitable, and does not produce good outcomes for many of its citizens.

The other end of the spectrum – a UK-style single national insurer – is a poor alternative, with long wait times, inequitable access to services, and poorer health outcomes compared with Australia in many treatment areas.

Australia’s balance between public and private care is world-class, and we need to keep both parts of the system strong.

We know that well informed doctors making clinical decisions provide the best outcomes for patients at a reasonable cost. Interference in clinical decisions causes all sorts of problems, such as we see in some of our public hospitals where clinical leadership has been diminished. Other problems may arise when doctors’ voices are removed from the decision making, such as rehabilitation care provided outside the faculty guidelines.

While they are the primary decision makers in private health, doctors do not stand alone; they are the vital cog of a complex system. Doctors’ private income is reliant on having hospitals in which to treat patients and private health insurance with which to fund services.

Australian families paying private health insurance win when doctors and health funds can work together to reduce or eliminate out-of-pocket costs. Contracts that ensure a doctor is paid more by the health fund so the patient pays less are a good thing. A significant number of doctors are keen to participate as they know they can deliver excellent patient outcomes with low or no out-of-pocket costs for consumers. Nine in 10 medical services covered by private health insurance now have no gap – a wonderful achievement for patients.

Doctors need more support. It is not sensible – and simply not possible – for doctors to know everything themselves. Doctors need help from academia, researchers, colleagues and their teams to inform their practice. There is a role for funders, be they government, private health insurance or patients directly, to provide information to medical practitioners to help doctors do their job. Serving the patient must be done in the context of good medical practice, solid research, experience, intuition and determining what is of value to the patient.

For example, we are working to give clinical societies information about the usage and cost of prostheses across the profession. Prostheses are the highest growing area of costs in our system, and doctors should be making informed decisions about what they are using. More than $12 000 worth of prostheses, for example, were used in a recent operation for a Bakers’ cyst (data provided by a private health fund). This is unlikely to be high value care. All doctors have a responsibility to be aware of the costs they are incurring.

Providing data is not managed care. Providing information creates value and ensures choices are informed by the data. Informed decision making reduces waste, improves affordability and ultimately benefits both our private and public health sectors.

It is disingenuous of Mr Milgate to claim that for-profit provision of health insurance is bad, while the private provision of medical services is good. It is also ridiculous to claim that doctors have no influence on the affordability of private health insurance.

Doctors have not only the “collective or individual ability to resolve the policy arguments, competing interests and the political debates that come from conflicting objectives in health care financing” but the moral authority to influence debate. The Australian Medical Association, professional colleges, societies and individual doctors hold the keys to better health care when supported by patients, funders and academia.

Private health insurers make no apology for seeking to keep their businesses strong. The best way to do that is to support high quality medical care, at a reasonable cost, with minimal out-of-pocket costs for the consumer.

Private health insurers have an obligation to their members to continue to discourage low value and low quality care, and we expect the medical profession to do the same. We will work harder to help inform clinical decisions, in consultation with your professional associations.

We will continue to work to provide doctors with the autonomy, clinical freedom and income they need to provide quality care to our customers.

Private health care is under threat, and ill-informed scare pieces about managed care that seek to paint insurers, hospitals, patients and doctors into corners do not help. Dialogue is important, and we need to work together as much as possible to get the best outcomes for Australian patients.

Dr Rachel David is CEO of Private Healthcare Australia.

The statements or opinions expressed in this article reflect the views of the authors and do not represent the official policy of the AMA, the MJA or InSight+ unless so stated.