Program: Drive Show
Date: 26/07/2018
Time: 4:46 PM
Compere: Rohan Barwick (interviewer Paul Serratore)
Interviewee: Dr Rachel David, CEO, Private Healthcare Australia and Dr Adam Coltzau, Rural Doctors Association of Australia
| PAUL SERRATORE: | Do you have private health insurance at the moment? And if not, is it because you believe it’s not needed? I mean, after all, we only have a public health system here in central Australia. And if that’s what you think, would you be more likely to get private health insurance if you could travel interstate for operations or to see specialists and have the cost of the travel and accommodation cover.
Well, that is what looks set to happen after the federal government said it would allow private health insurers to fund patient travel and accommodation from April of next year. The news has been welcomed by the Rural Doctors Association of Australia. Here’s the association’s Dr Adam Coltzau talking on the program yesterday. [Excerpt] |
| ADAM COLTZAU: | We’re very hopeful that this will be a game changer, really, for a lot of rural patients who have to travel a long way to get specialist treatment in larger centres. The Rural Doctors Association Australia’s been lobbying the federal government for quite some time to try and ensure that there’s some insurance available for rural patients to cover their travel and accommodation costs when they travel into larger centres. And we’re really pleased to see this announcement this week. [End of excerpt] |
| PAUL SERRATORE: | Dr Adam Coltzau from the Rural Doctors Association of Australia talking on the program yesterday.
So, how do private health insurers feel about the move? Dr Rachel David is the CEO of Private Healthcare Australia, which is the peak lobby group for health insurers. Dr Rachel David, good afternoon to you |
| RACHEL DAVID: | Hi |
| PAUL SERRATORE: | So, what do you make of the government’s plans to allow patient travel to be covered by private health insurance schemes? |
| RACHEL DAVID: | Look, the health funds think this is a pretty exciting development. Previously, about half the health funds have covered travel and accommodation to some extent, but they’ve been restricted to covering it under extras cover along with your allied health and dental, and the trouble with that is it doesn’t really allow the risk of very high claims to be shared between the funds as occurs under hospital cover. So, what this change means is that funds will be able to offer a travel and accommodation type product under hospital cover, which means if there are high claims the risk of those will be able to be shared between funds and it means that the amount of cover that can be offered will be higher than it currently is. |
| PAUL SERRATORE: | So, do you imagine that suddenly patient travel and accommodation costs and the like would be covered under, well, the most basic, the most general policies, or will there still need to be sort of extras cover for travel costs? |
| RACHEL DAVID: | Look, what I imagine is that once it goes into hospital cover that travel and accommodation will be included in more of your top cover type policies. So, what will be named the silver and gold policies under the new classifications. That’s because for some people there will be quite high costs involved in- while it’s unusual, the cost will be quite high because their hospital stays will be long and the distance involved is long, but I would stress that for some people the continuity of care from their specialist is so important that they will actually be happy to pay the cost of that premium.
And what I’m talking about is people with certain chronic conditions who end up needing surgery – they’ve had their specialist looking after them for a long time, but because they live in a regional area and they’re travelling for surgery, it’s important to them that they continue to have that care and they’re not looked after by people that they don’t know or shift workers who change over every day. |
| PAUL SERRATORE: | You mentioned sort of the high cost of travel. We know in regional areas airfares – which is I suppose the number one way people do travel when they need to go for emergency surgery or for medical visits – they can be quite high, I suppose more so than travelling between capital cities. Are we suddenly going to see regional private healthcare customers needing to have higher premiums, buy that extra level of cover, purely because of high airfares and high costs of living in a regional area? |
| RACHEL DAVID: | Look, no, that’s not the objective of this policy. However, I can imagine that the types of products that will cover travel and accommodation will be more your top hospital cover and gold cover. But the aim of this policy is not to push up premiums up; it’s to permit funds to cover travel and accommodation under their existing top hospital or gold products. |
| PAUL SERRATORE: | Now, we also know in places like- well, in many regional areas, but I’m using, obviously, Alice Springs as the most obvious example – private health insurance is often talked about as something that really you don’t need, aside from, I suppose, taking the tax break, given that we’re in the public health system. Has there been an issue in regional areas, in places like Alice Springs, which are only served by a public hospital, where people suddenly don’t see the value in private health insurance? |
| RACHEL DAVID: | Yes, that’s right. The rates of health fund membership in regional areas do tend to be a little bit lower, but there are a couple of reasons why people take out even a basic level of cover in regional areas and one I’ve mentioned already, and that is the need for continuity of care from a particular specialist.
The second reason that we see, particularly with younger people, is people who have experienced sporting injuries and other injuries from activities they’ve been doing which are- actually it’s very difficult to get them completely treated in the public hospital system. And we see that a lot in the feedback that we get here at our office and also to the health funds, that younger people, if they have to wait, say, a year to get tendons and joints repaired as a result of a sporting injury, that’s a year when they can’t work to their full capacity and it becomes very important for them to get treatment on time. |
| PAUL SERRATORE: | The voice you’re hearing is that of Dr Rachel David, the CEO of Private Healthcare Australia; they’re the, I suppose, peak representative body for health insurers in Australia. Now, Dr Rachel David, I want to actually put something to you that Adam Coltzau from the Rural Doctors Association Australia told us yesterday in relation to what he imagines would be a good level of cover when it comes to, I suppose, accommodation and car hire costs and the like. This is what he told Alex Barwick yesterday. [Excerpt] |
| ADAM COLTZAU: | Well, I think there needs to be a standard set that would cover a three star plus motel. I don’t think you’d get one of them for under $100. So, I think that’s the ball park you’d be looking at. I can’t imagine there’d be many in Darwin or in Adelaide that would be under $100. And I think people need to stay in a reasonable level of comfort, especially when they’re unwell. |
| ALEX BARWICK: | At the moment, the travel assistance scheme here doesn’t include things like car hire – it does give you some money towards fuel – but would you like to see something like that included as well? |
| ADAM COLTZAU: | Yes. I think each insurance company should look at options for people, especially if you have to fly from Alice Springs to a larger regional city – how are you going to get around? [End of excerpt] |
| PAUL SERRATORE: | That’s Adam Coltzau from the Rural Doctors Association of Australia talking to us yesterday.
Now, Dr Rachel David, do you think private health insurers would be accommodating to that? To have sort of that level of cover, sort of the standard of three stars and above for accommodation and the like? |
| RACHEL DAVID: | I think he’s made some really good practical suggestions there and I’m sure that health funds, particularly the larger ones, will be in a position to, you know, to reach out and actually consult with rural doctors about the structure of these products. Many of the smaller ones already have some pretty strong relationships in place because they’re actually located in regional areas.
One observation I would make is, having done my own medical training in Adelaide and dealt with a number of rural patients at that time, is a lot of suitable accommodation is actually located around hospitals, simply because of the need for people to come in and out. And I think it is- while, you know, the costs that he’s mentioned of $100 a day over a few weeks would add up, I think it is actually quite reasonable for the type of thing that we’re looking at and I do believe from experience that that type of accommodation is available, should funds choose to cover it. |
| PAUL SERRATORE: | And finally, Dr Rachel David, we know that in terms of travel schemes, that has, well, been very much been the domain of government we know here in the Northern Territory there’s been many changes to our Patient Assistance Travel Scheme. Do you think having it included in private health insurance will ease the burden on governments who’ve had to put up their own scheme to kind of fill in the gaps, so to speak? |
| RACHEL DAVID: | Look, it will and I think that’s the idea. Particularly for people who’ve chosen private health because they want continuity of care from a particular specialist, this gives them another option to be able to have care at a time of their choosing rather than to have to wait to a time when it might not be convenient or even appropriate for them to have surgery. |
| PAUL SERRATORE: | Well, could it actually see it replace patient assistance travel schemes like the one in the Northern Territory if suddenly private health insurance is coming to fill the gap, governments suddenly feel they no longer need to provide that service to their citizens? |
| RACHEL DAVID: | That’s a risk that’s been considered. We have seen some cost shifting from public to private, particularly in terms of medical patients coming in through emergency departments, but be aware that this is still going to be a product for which a reasonably high premium will need to be paid. There’s definitely a role for the patient travel and assistance schemes to continue for low income patients and patients that aren’t able to afford private health insurance, but I think this is a useful adjunct to that for people who do want control over the time of their surgery and their specialist of choice. |
| PAUL SERRATORE: | I suppose then what does that mean, for example, for pensioners who’d be on that sort of low income and health care scale? |
| RACHEL DAVID: | Well look, for pensioners, if they don’t have private health insurance it is completely appropriate for state governments to continue to fund their travel and accommodation. |
| PAUL SERRATORE: | Dr Rachel David, appreciate your time with us this afternoon. |
| RACHEL DAVID: | Thank you very much. |
| PAUL SERRATORE: | Dr Rachel David, the CEO of Private Healthcare Australia, the peak lobby group for health insurers in Australia, welcoming federal government reforms which will see health insurers able to cover the cost of patient travel and accommodation as part of their insurance policies. Although, I suppose, from that conversation there you would’ve heard that it will, I suppose, require an extra level of cover. It won’t be included with your most basic cover, but it’ll be interesting to see what will happen from April of next year. |
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