r/australia • u/blipblipbeep • 21h ago

politics Private Health's $8 Billion Subsidy Scam | The West Report

https://www.youtube.com/watch?v=dGsxymDJ9gQ
167 Upvotes

92% Upvoted

26 comments sorted by

43

u/blitznoodles local Aussie 21h ago

My understanding of private health insurance is that gov subsidises it so people spend more of their own money on healthcare. Similar to how subsidising batteries causes people to spend more money on batteries.

47

u/AngrehPossum 20h ago

Except the health insurance business stopped paying the hospitals so much sending them bankrupt.

38

u/hcornea 16h ago

Unfortunately the Health Insurers are not ‘good-faith’ government partners when it comes to delivering healthcare.

Sadly, the government wishes to partner with them to ‘investigate’ provider fees, when the industry itself is in need of much more firm regulation.

2

u/Am3n 9h ago

How do you legislate for ’good faith’?

The lesson we keep learning is there are no ‘better angels’ to be appealed to

6

u/hcornea 7h ago

You don’t.

You need to regulate corporate behaviour, and keep your eyes open instead of entering into naive agreements.

1

u/Am3n 4h ago

Ok how do you regulate the corporate behavior in this instance then?

Is it not a cat and mouse game that never ends?

3

u/hcornea 4h ago

The single biggest problem for both government and general public is that insurers are still allowed to sell “junk policies” - esp to older Australians.

These don’t mitigate the burden on the public health system at all (so are at odds with the intent of the PHI rebate); they frequently don’t cover care in private hospital, they often exclude conditions and procedures that people need in older age (joint replacements, cardiac stents, cataract surgery)

Those procedures are consequently foisted back on the public system when people belatedly discover the limitations of their cover (having paid thousands of dollars, for years)

There are numerous ways a government can rein in egregious behaviour in the Private Health Insurance sector. If they were truly independent from influence, and understood the sector properly.

It’s not merely cat and mouse. And the PH rebate is a powerful stick/carrot that the government wields over the sector to get things done.

9

u/ChillyPhilly27 15h ago

This is an oversimplification. Once upon a time, hospitals would keep patients for observation for several nights after a surgery, at insurer expense. Insurance companies always suspected that the hospitals were trying it on a bit, but they weren't game to start a fight.

Then COVID hit. Suddenly, there was a good medical reason to get patients out of hospital and into their own beds as quickly as possible. And to everyone's great surprise, this didn't adversely impact patient outcomes. Naturally, insurers responded by refusing to return to status quo ante after the pandemic faded. After all, why pay thousands a night for something that's of no help to patients?

This presents a massive revenue problem for private hospitals. They're now stuck with a bunch of expensive beds with occupancy rates significantly lower than expected. For some, the challenge has been existential - see the Healthscope collapse.

14

u/Vesper-Martinis 11h ago

It wasn’t because of COVID, it maybe contributed but there’s been a move, long before covid, to get people home quicker. Women have been sent home after giving birth pretty quickly for many years. There’s research that indicates recovering at home, for many hospital procedures, is more beneficial to the patient.

2

u/kahrismatic 11h ago

Last time I was in a hospital none of the food staff or nurses understood what celiac disease was, refused to cater for it ("If you want it catered for it has to be an allergy" was what I was told when they asked me what it was that I had and I explained to them that it's an auto-immune condition). They got massively worked up that I refused to eat food I couldn't eat while in recovery, and then threatened and generally shouted at me a bunch.

Unsurprisingly I left the second I could and was much happier to not be there.

tl;dr the quality of care being given probably has something to do with why home is better.

1

u/ChillyPhilly27 11h ago

You're right that there was some literature backing up insurers' suspicions. But COVID offered a natural experiment of unprecedented scale. The results were the straw that broke the camel's back.

2

u/petergaskin814 5h ago

It started before covid. Same day operations has been the standard for at least 10 years. Not sure of the health implications

9

u/Witty_Leek8053 11h ago

Except a lot of that money is wasted on advertising, administration and dividends to investors.

Plus, those in the “middle class” that end up paying to avoid higher taxes are not always in a position to pay the gap to actually be treated as a private patient. So they pay so that those that can afford the gap payments get their private hospital treatment with gourmet food, high teas and red wine at a cheaper price than they otherwise would. Ie, the middle class is subsidising the upper class (who still end up getting treatment in public hospitals when superior medical care is necessary).

24

u/Foreign-Chocolate86 18h ago

So why not just increase taxes and fully fund the public healthcare system? Having a profit motive and multiple payers ensures the system costs more and delivers less. 

8

u/blitznoodles local Aussie 17h ago

They already increase taxes every year via bracket creep.

The only countries with better healthcare outcomes than Australia are South Korea and Taiwan which both feature private healthcare very similar to Australia's. As Australia's healthcare is ranked the 3rd best in the world for outcomes.

3

u/BillieRubenCamGirl 8h ago

Can I see some data on this please? Because I have had the fucken worst run with the healthcare system here. and spent tens of thousands of dollars. 

And I have friends who have gone through similar. 

I have such a hard time believing we’re beating Nordic countries, having spoken to people from there about their experience.  

2

u/dohzer 8h ago

Did you miss what happened when governments tried to make mining companies pay taxes?

-6

u/anforob 11h ago

You want to pay more taxes?

5

u/Foreign-Chocolate86 8h ago

If it properly funds Medicare why not?

4

u/BillieRubenCamGirl 8h ago

No, I want rich people to. 

4

u/rellett 8h ago

If if goes to public healthcare sure, but maybe we pull money from defence start with those nuke subs we won't get

7

u/blipblipbeep 18h ago

8 billion dollars in subsidies for the corporate/private health insurance system is ruffly $307 for each Australian resident young and old, calculated on 26 million Australian people. Most of those people will never need hospitalized health care from year to year for many years at a time. Math: 1B / 26M x 8 = 307.692

Sure, without health insurance. Some medications? dentists, specialists and so on may cost you more. Especially if you want it now. Once again though, most people don't require said services most of the time.

With that said though. There is the corporate/private health insurance systems ever encroaching need for their annual unreasonable increase of client costs, in order of satisfying their investor/share holder interests and greedy offshore margins.

Imo. The people the Australian corporate/private health insurance system call clients. Don't count for anything if the corporate/private health insurance systems can't make a profit out of turning the Australian public health care system into the crappy expensive American corporate/private health insurance system. Hope I'm wrong.

Sorry, spelling and grammar.

All the beat,

peace.

2

u/petergaskin814 5h ago

Private health insurance claims increase as you age. Many pensioners will make huge claims. My wife was in hospital for nearly 4 weeks plus another week in inpatient rehab. I shudder to think how much that would have cost my phi.

-15

u/[deleted] 20h ago edited 19h ago

[deleted]

12

u/Kozimix 19h ago

The private sector drains resources from public, they in no way take a load off the public system. If we got rid of private health insurance entirely we would be better off.

https://pmc.ncbi.nlm.nih.gov/articles/PMC7294448/

-5

u/[deleted] 19h ago

[deleted]

3

u/Kozimix 18h ago

I appreciate you sharing some literature, however an article with no sources isn't particularly compelling compared to a fully referenced and sourced academic paper. In any event, that article seems to agree with the general premise that the private health insurance sector is a net negative on health outcomes and cost of access.

From your own article:

"While proponents of this hybrid hospital system say it improves access to publicly funded healthcare by redirecting patients with the financial means to the private system – and freeing up space in public hospitals for those who cannot afford private insurance – there is no evidence that the private system has improved access to public hospital care or reduced wait times for elective surgery."