ABC Radio Adelaide Mornings program interview with Dr Rachel David on cost shifting in South Australia’s public system

Station: ABC Radio Adelaide
Program: Mornings
Date: 21/4/2021
Time: 9:17 AM
Compere: David Bevan
Interviewee: Dr Rachel David, CEO, Private Healthcare Australia


DAVID BEVAN: Dr Rachel David, CEO of Private Healthcare Australia. Now, that’s the peak representative body for the private health insurance industry in Australia. Good morning Dr David.
RACHEL DAVID: Morning David.
DAVID BEVAN: Now, this practice has been going on for some time. But until you’re actually admitted to a hospital or a family member is, you might not be aware of this device that the state government has in terms of shifting cost. So, a person turns up and they’re admitted to a hospital as a public patient. And then maybe in the next 24, 48 hours, they’re handed a pamphlet saying you’ve got private health, how about you sign this document which means your stay will be covered by your private health insurance? And we promise, cross our heart and hope to die, we will not pay you- you won’t be given a gap. So, you won’t notice any difference, but we’ll be able to get the cost of your stay from your private health insurance.

Now, Rachel David, this has been going on for years, hasn’t it?

RACHEL DAVID: Yeah, look, that’s right. But we are getting a bit concerned that the bean counters around control in South Australian public hospitals- there are a few documents floating around that- have been consulting documents that have been produced by one of the big accounting firms that is urging the local health networks in South Australia to increase their revenue from private patients by a very significant amount – 16 per cent, 12 per cent per annum. And I think at that point, you really need to ask yourself, well, what is being provided here? Is it a private or a public hospital system that is being run in South Australia? And my concern is, look, if people with private health insurance are making an active choice, that they want their own doctor throughout their stay in a public hospital, and that’s what they get – well, that’s fine. But what we’re seeing is actually a lot of people who feel that they’ve been bullied and harassed into making this decision, not by doctors, but by bureaucrats and finance people. And we’ve had a number of complaints that have been made to doctors and health funds operating in South Australia that relatives who were not of sound mind were pressured into making this decision, that it did have financial consequences for them. This is Australia-wide, but on average, people that do elect to be a private patient in a public hospital do end up paying gaps for things like medical tests of an average of about a thousand dollars.

So, I think overall, people need to understand their rights and that if you’re an Australian citizen, you are covered by Medicare. So, if you do need to go into a public hospital because you’ve got something serious or that’s where your doctor works, you actually are entitled to be treated as a public patient and you’re entitled to insist on those rights.

DAVID BEVAN: Yeah. Trying to work out whether anything wrong has happened here, whether there’s anything wrong with the government saying, well, look, you know, we could do with all the money we can get. And if you don’t mind using your private health insurance and we promise there won’t be any immediate penalty on you because you won’t be asked to pay a gap, what’s the big deal? And so, what is the big deal?
RACHEL DAVID: Look, I think it comes down to the welfare of the patient. If the patient is treated properly and they’re given full consent, their doctor is on board with the location of their treatment, then, you know, you could argue that-even though they’re paying twice for their admission essentially, that nothing’s gone wrong. Right? You know, public hospitals are under stress. They may need to raise revenue from multiple sources. However, the evidence that we’re seeing is that in some cases, patients are not being treated appropriately. And people who have dementia and- or other mental health issues are being pressured significantly by people who are not doctors to make this decision, which can turn out to be a financial decision for them.
DAVID BEVAN: Then- you say the person is paying twice. In what way?
RACHEL DAVID: Well, look, they’re paying trough their taxes to have free access to healthcare and public hospital system. But they’re also, in many cases, have been paying a health fund for a number of years. And in some cases, well, we know that a number of cases will also be paying in out of pocket in this situation, whether it’s attached to the hospital stay or because of a diagnostic test that was done as a part of the admission. So, look, it is ultimately up to the patient, but we think that aggressive revenue raising tactics in this setting are inappropriate and that the financial objective should never be able to override the clinical needs of the patient or the way a patient is treated when they’re in hospital.
DAVID BEVAN: Yeah. In a moment we’ll come to Ron. Our phone lines are open. If you’ve got some thoughts on this, you think it’s a good thing for the government to do or a bad thing, 1-300-222-891. If one person does this, okay, the government gets maybe a couple of thousand dollars. If a thousand people do this, the government ends up with a couple of million. And if every state government is doing this, we’re talking about big bucks here, aren’t we? And that’s going to be reflected in the private health premiums that people pay, but they’re only getting a Medicare service.
RACHEL DAVID: Yes, look, that’s right. And I think that if people end up being admitted to hospital, for instance, inappropriately because the hospital might be able to raise revenue in that way, then that can become an issue. If they need to be admitted anyway, look, you could argue that, you know, it’s their choice and that’s an appropriate way for the hospital to manage its budget. But if there’s an incentive to declare that an admission has taken place for the sake of planning for a health fund and there is some evidence that that has been happening, then that is a big impost on health funds. And we do- you know, we have had some cases where funds have lost a considerable amount of money as a result of that practice, and that gets reflected back in premium increases to consumers.

The other issue that I think is important to consider is then if the hospitals are aggressively raising revenue in this way and trying to meet the targets that are set out in these documents, what is happening to people that really can’t afford to pay and that really are reliant on the Medicare system and are waiting perhaps for treatment for a number of years if the incentive is to fill beds with people with private health insurance?

And I think that is a fundamental question that we need to answer here is: is this a public hospital system or is it not? And we do, I think at the moment, need some reassurance that the Government is meeting its obligations under the Medicare system, to provide a service for public patients.

DAVID BEVAN: Now, we’re talking to Dr Rachel David, she’s the CEO of the Private Healthcare Australia – that’s the peak representative body for private health insurance industry in this country. Michelle in Kapunda says: my husband was coerced into signing a health insurance admin form for a public hospital. No additional benefits for him and the hospital denied it happened. I had copies of both admin forms. Michelle from Kapunda.

Let’s go to Ron. Good morning, Ron.

CALLER RON: Good morning, boys and girls. It’s a wonderful world, isn’t it?
DAVID BEVAN: What’s your experience, Ron?
CALLER RON: Oh my God. Look, if I told you my experiences, mate, you’d your hair would be curling up, alright? Okay, because the first one is that many moons ago when my son was playing footy at school, he broke his finger. So, we took him to Flinders. We get down there and the first question out the doctor’s mouth was: are you private or are you public? I thought: I’ve got private because I’ve got to have it because of my job, but I’ve also got public health. I thought, we’ll come in this time as a public patient. He says: if that’s the case, then you better get home and come back tomorrow. I said: well hang on, hang on. Well, what if I say that I’m going to come as a private patient? Oh, that’s fantastic, he said, then we can open the ward for you. So, the next, the next doctor came up [indistinct]…
DAVID BEVAN: Wow. And this was at Flinders Medical Centre?
CALLER RON: This is at Flinders, yeah. Okay. Now, the next doctor comes along, because the word had got around we’re going to be private patients. The next five bloody doctors came along and the first question out of their mouth was: are you private or are you public? So, the sixth doctor came along and I said to the guy, I said: look mate, if you ask me if I’m private or I’m public, I’ve already told your off-siders we’re going to come as public- as a private patient. If you ask that question, your head’s going through the bloody wall.
DAVID BEVAN: Oh, now, I hope you didn’t say that, Ron, because…
CALLER RON: [Interrupts] No. Seriously. No look, seriously-
DAVID BEVAN: [Interrupts] No. Ron, come on. Look, whatever was going on there, I mean, those people in the emergency departments, they’re under enough stress. They don’t need you threatening them, Ron.
CALLER RON: [Talks over] My son- My- Mate, that’s what I said to him because I was so angry that no one had asked us: what is the problem with your son? The first question was: are you private?
DAVID BEVAN: [Talks over] Are you private? Well, that shouldn’t be the first question. Ron, thank you for your call. Marie says: David, thank you for bringing up this matter. In my experience there is pressure put on the patient who is too ill to make such decisions at that moment to go along with what is being suggested – to use their health fund payments while in a public hospital.

Margaret’s called from Ashbourne. Hello, Margaret.

CALLER MARGARET: Hello. Yes, I just wanted to say that we had a totally different experience to the gentleman that’s just been on. My husband, in 2014, were diagnosed with stomach cancer. And after all the preliminary tests that were done, the surgeon, who also treats private patients in private hospitals and what have you, but also works at a public hospital, he said: unfortunately- when we questioned, you know, are we going into a private hospital, he said: unfortunately, I cannot get a large enough team together for this operation in a private hospital. We have to do it in the public hospital. Now, that happened and they managed to save David’s life at that stage and keep him going for five more years. However, we were asked, someone did come around, very politely, and say: are you in a private health fund? Are you happy to contribute and for us to claim for the cost of your bed from the private hospital?
CALLER MARGARET: Believe me, in those circumstances, we were more than happy for them to claim from our private health fund. David had had a massive operation which took many hours, and you know, he was alive afterwards. Why would we not contribute towards, you know, what he had been given?
DAVID BEVAN: Margaret, thank you for your call. And on the text line somebody is saying: I think making the private insurer pay is a good thing. I always sign the form. At least I know the hundreds of dollars I pay in premiums to the insurer is used.

Rosemary’s called. Hello, Rosemary.

CALLER ROSEMARY: Hi, how are you?
DAVID BEVAN: Good. What are you thinking?
CALLER ROSEMARY: I went to hospital a couple of years ago because I had a spider bite, and I got admitted through emergency, and I was in there for a couple of nights. And on the day that I was being discharged, I had a lady with a sheet come to the- come to see me and asked me whether I wanted to put it through my health fund. And I thought, ah. And I thought, well, I’ve worked for 40 years and I’ve never, ever been to hospital and I pay my Medicare levy, so I thought, well, strictly speaking, it should, you know, go through the hospital. And I thought if I put it through HCF, my health care fund, all I’m going to do is contribute to the fees going up from my healthcare fund.
DAVID BEVAN: Well, yeah.
CALLER ROSEMARY: So- Yeah, that’s what I- And I sort of thought, and she, she was very polite, very courteous with it all, but she was quite pushy with it all. You know, you’ve got this great hospital. The service-
DAVID BEVAN: [Talks over] You felt there was, you felt there was pressure on you to sign over to become a private patient.
CALLER ROSEMARY: She- Well, she was very encouraging, let me put it that way.
DAVID BEVAN: [Talks over] She was very encouraging.
CALLER ROSEMARY: Yeah. She was very encouraging, and I thought: no, I don’t think I want to do that. But I do have another friend that, when the question was asked, she- I think because she put on the spot, and it’s like an hour before discharge…
CALLER ROSEMARY: … it would be- do you know what I mean? You don’t have time to think. You don’t have a lot of time to think about it when they put that question to you. It’s not like they’ve asked you at admission where you say: do you have a health fund? And I said that: yes, I did. And then they don’t say at that time: would you consider it going through your health fund? And you could say: well, I’d have to think about that, or whatever. So, yeah.
DAVID BEVAN: Yeah. Rosemary, thank you for your call.

Here’s an interesting text from Pauline. She says: as a private patient, you don’t get access to free-post hospital care and you have to pay for your medicines. Dr Rachel David, CEO of Private Healthcare Australia, is that the case?

RACHEL DAVID: Yeah, it can be. These are some of the hidden charges that people might experience if they do actually elect to sign the form. So we have done a couple of surveys Australia-wide that has shown that, on average, it can be between $400 and $1000 that people might need to pay for those extra services. I mean, there’s some fantastic examples of different circumstances that came through on those calls. The lady whose husband, unfortunately, had serious stomach cancer, that is the absolute appropriate use of a public hospital to- you know, and in that situation you’d want to have your own doctor, a fully trained specialist and a fully trained team, looking after your relative. I think that was absolutely appropriate situation. The guy with his son had a possible broken finger – in the time that those people spent fooling around about whether it was a private or a public patient, his finger could’ve been fixed.
RACHEL DAVID: You know, so that is clearly a situation where, you know, the bean counters are overriding common sense.
DAVID BEVAN: Rachel, thank you very much.
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