Transcript
Station: 3AW
Program: Mornings
Date: 30/03/2020
Time: 9:48 AM
Compere: Neil Mitchell
Program: Mornings
Date: 30/03/2020
Time: 9:48 AM
Compere: Neil Mitchell
Interviewee: Dr Rachel David, CEO, Private Healthcare Australia
| NEIL MITCHELL: | You might remember on Friday, I was talking to the Chief Executive of HBF Health Insurance. They were cancelling their premium increase, it was going to cost them about 30 or 40 million a year. But others in the industry are taking a similar attitude. On the line, Dr Rachel David, Chief Executive of Private Health Care Australia, the peak body for the major health fund. Dr David, good morning. |
| RACHEL DAVID: | Good morning, Neil. |
| NEIL MITCHELL: | Have you caught up with the fact in Victoria, the government’s effectively taking over Cabrini Private and Epworth Private? |
| RACHEL DAVID: | Yes. It’s extraordinary times, Neil, but there’s capacity in the private sector that’s needed, both the intensive care facility for respiratory patients but also the capacity to continue to do emergency surgery like the odd burst appendix or accident, it’s still going to happen during this time. |
| NEIL MITCHELL: | And what about the nurses who have been stood down or other medical staff? Surely, they can be used in the system. |
| RACHEL DAVID: | Look, I would’ve thought so. It appears that the negotiations with the private sector are occurring by state governments and they’re a bit different between each state. I do think that Daniel Andrews has shown some leadership on this issue and has indicated that the staff will be put to full use. And I think that’s pretty essential because don’t forget, in six months’ time when this is over, there’s going to be a massive bottleneck of non-emergency surgery, your hips and knees that have built up. And we need to be in a position to rapidly address that as well. |
| NEIL MITCHELL: | Now, the- what are you doing? You’re delaying premium increases? For how long? |
| RACHEL DAVID: | Well that’s right, for at least six months, what we’re going to do is review in six months whether the normal claims pattern has recommenced and then we will have a discussion about it then. But at the moment, people are obviously incredibly anxious and the other thing that funds have done at this time is for anyone who’s lost their job or has reduced hours and is in financial distress, we’ve said, you know, don’t drop your cover, talk to us first and we’ll work something out until you’re back on your feet. |
| NEIL MITCHELL: | Well that will obviously cost the industry a bit, but on the other hand, you wouldn’t be paying out as much, wouldn’t you? |
| RACHEL DAVID: | That’s correct. We’re obviously highly regulated so we have to put in a forecast every time we make a change. But the important thing is the health funds do not want to make a dollar of profit by accident as a result of COVID. So what’s going to happen is that if it does look like, as a result of reduced claims that they’re accumulating funds, then that will be paid back to members. |
| NEIL MITCHELL: | How much will it cost or how much will it save people over six months? |
| RACHEL DAVID: | Look, it’s about- on an industry basis, it’s about half a billion dollars or $500 million straight up. It will depend on a person’s individual policy, how much it will save them in six months. But maybe about $3000? |
| NEIL MITCHELL: | Okay. Will you try and catch that up? I mean the banks have said we’ll put a freeze on payments but the interest compound- some of the interest is compounding in the meantime. When the- when we’re through all this and you go back to normal increases, will you try and catch it up or not? |
| RACHEL DAVID: | It depends entirely on what happens with claims. This is extraordinary circumstances and [indistinct] there’s still a few things that we’re going to need to factor in. One is the mental health claims that are going to result as a result of this. And as I’ve said, they’ll be a big bottleneck of elective surgery or the non-emergency cases that are still essential but people are not going to be able to get into hospitals for surgery for some time now.
And when the public hospitals are fully committed to COVID patients, it’s going to take them a long time, longer than six months, to be able to get back to their normal elective surgery waiting list. So there is going to be that issue. At the end of this, we need to take that into account but that being said, we’re not going to retain a dollar of profit as a result of COVID. It will be paid back. |
| NEIL MITCHELL: | Thank you very much for your time. Thank you, Dr Rachel. |
| RACHEL DAVID: | Thanks, Neil. |
| NEIL MITCHELL: | Dr Rachel David, Chief Executive, Private Health Care Australia. |
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