AMA submission to Department of Health and Aged Care consultation on PHI Incentives and Hospital Default Benefits Studies

The AMA’s response to the Department of Health and Aged Care’s consultation on private health insurance (PHI) incentives and hospital default benefits notes that much of the work done by consultants for this consultation was proposed by the AMA in 2020 in the AMA prescription for private health insurance.

The AMA supports many of the recommendations that are long overdue, such as establishing a process to regularly review and adapt PHI policy settings over time to ensure their ongoing fairness and effectiveness.

It is also critical that any changes made improve the value proposition of private health for patients. For Australians to take out private hospital insurance and maintain that coverage through their lives, PHI policy products must be easy for consumers to understand and provide them with genuine value.

The AMA is continuing to call for an independent Private Health System Authority (PHSA) to oversee the ongoing viability of the private health system, by filling current gaps in regulation and policy-making and acting as an independent umpire with the aid of improved and ongoing data analysis. 

Under current arrangements, there is no independent mechanism to look at the bigger regulatory picture, gauge the impact of ad hoc changes or balance the interests and needs of day hospitals, private hospitals, private health insurers, medical device manufacturers, doctors, and most importantly patients.

A Private Health System Authority would ensure a cohesive regulatory model and safeguard patient choice, which is central to its value proposition. 

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