RACS wants minimum standards for private health insurance, an overhaul of Medicare rebates and greater scrutiny of public hospital capacity.
Private health insurers should face minimum coverage standards, Medicare rebates should be overhauled and governments should publish how long patients wait just to see a public hospital specialist, according to the Royal Australasian College of Surgeons.
The RACS laid out a broad reform agenda in its submission to the House of Representatives inquiry into access to and affordability of medical specialists, informed by a survey of more than 700 surgeons across Australia.
Among 12 recommendations were calls for minimum private health insurance benefit floors for clinically necessary care, standardised disclosure of coverage and exclusions, item-level transparency of benefits and real-time confirmation of patients’ coverage.
The college also wanted the $500 threshold used under most insurers’ known-gap arrangements reviewed, arguing the figure has remained unchanged for years despite substantial growth in the cost of providing care.
“Reviewing the known-gap threshold could keep more procedures within gap cover – simplifying billing, and in turn reducing patients’ overall out-of-pocket costs,” the submission said.
RACS also called for an independent, profession-led review of Medicare Benefits Schedule rebates to better reflect the time, complexity, expertise and resources involved in contemporary surgical care, followed by ongoing indexation against the real cost of providing care.
Sixty-seven percent of surveyed fellows nominated modernising MBS rebates as the reform that would most improve access to surgery, followed by increased public hospital investment at 55.4% and reform of private health funding mechanisms at 36.2%.
RACS president Dr Philip Morreau said debate about specialist affordability needed to look beyond the fee charged by the doctor.
“When a patient faces out-of-pocket costs, we need to understand what has created that gap,” he said.
“A specialist sets their professional fee, but they don’t set the Medicare rebate or the benefit a patient’s private health insurer will pay.
“When Medicare and insurer contributions don’t keep pace with the cost and complexity of delivering care, more of that cost can fall to the patient.”
Public hospital capacity
The survey found inadequate public hospital funding was the most commonly identified barrier to patients accessing surgery, nominated by 70.3% of fellows.
Theatre closures and limited operating lists and private health insurance settings were each nominated by 50.9%, while 46.5% identified a lack of hospital beds and 32.7% pointed to growing numbers of uninsured patients.
RACS wanted increased investment in operating theatres, theatre utilisation, beds and workforce, accompanied by better national reporting of theatre use and waiting lists.
It also called for routine publication of public specialist outpatient waiting times, including the period between a patient’s referral and first specialist assessment, arguing existing elective surgery data does not show the full extent of unmet demand.
“Patients may experience delays before specialist assessment, travel to another region, enter the private system because public care is unavailable, postpone care because of cost or distance, or not receive care at all,” the submission said.
Dr Morreau said pressure on the public and private systems could not be considered separately.
“If capacity is lost from the private system, the need for surgery doesn’t disappear. It moves elsewhere, including into already stretched public hospitals.”
Unreasonable fees
RACS acknowledged that “a minority of opaque or excessive billing practices exist” and supported action against unreasonable charging, but opposed blunt fee caps.
Instead, it proposed an independent, practitioner-informed, mediation-focused, commission-style framework using peer review, education and ethical guidance to address genuinely unreasonable fees.
The college argued any system should distinguish outlier billing from gaps driven by inadequate Medicare rebates, complex cases, multiple providers and limited public alternatives.
RACS also supported informed financial consent and greater fee transparency, but said patients needed information about every component of their bill.
“But genuine transparency means understanding the whole equation – the specialist’s fee, the Medicare rebate and what the insurer will actually contribute,” Dr Morreau said.
“Transparency alone won’t increase a Medicare rebate, improve an insurance benefit or create additional hospital capacity.
“If we want to make surgical care more affordable and accessible, we need to address the system that sits behind the patient’s bill.”
Read the full submission here.
