ABC News Breakfast program interview with Dr Rachel David on premiums and PHI measures

Station: ABC News
Program: Breakfast
Date: 31/03/2020
Time: 7:24 AM
Compere: Sandy Aloisi
Interviewee: Dr Rachel David, CEO, Private Healthcare Australia


SANDY ALOISI: Well as the Federal Government pledges billions of dollars to try to cushion the country from the impact of coronavirus; people are looking at ways to cut costs to ride out the pandemic. And the private health insurance industry is taking steps to try to ensure that people continue their fund membership through the crisis by delaying premium increases and introducing other measures. The CEO of Private Healthcare Australia is Dr Rachel David, who joins us now. Doctor, good morning. Thanks for joining us.
RACHEL DAVID: Morning Sandy.
SANDY ALOISI: And, I suppose, membership of the private health insurance industry had already been falling, so it makes sense to try to stop people from dropping their cover through this crisis.
RACHEL DAVID: Well absolutely. We don’t want anybody to drop their cover; firstly, because they’ve lost their job or because they’ve got greatly reduced hours. So anyone in that situation, before they consider dropping their cover should contact their health fund, because they all have put hardship provisions in place and will be able to provide relief on premiums for those people over this time. And as you mentioned, in addition, there was a planned premium rise for 1 April, a planned price rise that will now be deferred. We’ve said for six months but we will review it prior to then, with the regulators, to ensure that it’s necessary.
SANDY ALOISI: So if people are looking to cut costs through this pandemic and they think: well look, private health insurance is a luxury, it can go. What are you suggesting they do? They call you, but can what the private health insurance industry do for them?
RACHEL DAVID: If someone is in genuine financial distress, they should discuss their circumstances with their health fund. I mean, there are a number of reasons why that could happen, the main one being under or unemployment and the funds are prepared to assist people in that situation. But also, in addition, there are a number of services that the funds will be providing and the first one is that regardless of anyone’s level of cover, if they get admitted to hospital with COVID, they will be fully covered. So even if you’ve got a basic hospital policy and you happen to get admitted, you will be covered and there are a number of services that the funds are providing. Particularly, switching over the mental health services and psychologists to Telehealth and providing additional telephone support for mental health during this time.
SANDY ALOISI: So are you suggesting that the health funds could possibly freeze the monthly payments until this is over? For people who can’t pay?
RACHEL DAVID: That is correct.
SANDY ALOISI: So how long will that be for?
RACHEL DAVID: It will be for the duration of the crisis, until people can get back on their feet. So, everyone’s circumstances are different and every health fund is handling this in its own way. So everybody- but the first thing that people should do if they find themselves in a situation where they’re out of work or their regular income has ceased as a result of the crisis, they should call their fund.
SANDY ALOISI: And is a rise in premiums inevitable when this pandemic is over?
RACHEL DAVID: Look, what we need to do is to track our claims very carefully, because like every other business, we are in completely uncharted waters. We are fully expecting that after this is finished there will be a bottleneck in essential surgery that’s been put off that the public sector will not be able to address easily. So a lot of those cases will end up billed to health insurance. And in addition, there’ll be the impact of the mental health impacts of self-isolation at home, which we’re also preparing to deal with. But all of that said, we will be able to wear that and still be viable at the end of this, we just need to keep a very close eye on what’s happening, look at the data and ensure that we’re prepared.
SANDY ALOISI: That sounds like answer being yes, to a rise in premiums inevitable when the crisis is over, I would imagine.
RACHEL DAVID: Well eventually things will get back to normal and we’ll look at every way possible to put downward pressure on health costs.
SANDY ALOISI: Alright Doctor, thank you so much for coming on with us this morning.
RACHEL DAVID: Thanks Sandy.
SANDY ALOISI: Dr Rachel David there, she’s the CEO of Private Healthcare Australia.
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