The association wants private health sector reforms to begin as soon as annual processes allow and remain in place for at least five years.
The AMA has told the federal government that private health insurer rebates and MBS funding must increase significantly if private hospitals, maternity units, and psychiatric care are to remain sustainable.
The Department of Health, Disability and Ageing released the first in a set of three consultation papers in July, examining the options to reform the private health sector.
The first paper examined mental health care, maternity care, hospital in the home (HITH) programs, regional private hospitals, private health insurance product simplification, and risk equalisation.
The AMA submission, published yesterday, primarily highlighted that MBS and private health insurance rebate funding haven’t kept pace with costs, leading hundreds of thousands of Australians to downgrade their private insurance.
“[Private healthcare] exists to provide choice, not to compensate for a public system that cannot cope,” the submission read.
AMA president Dr Danielle McMullen said the balance between public and private health was “critical”, and that while the AMA was pleased with support for rural private hospitals through modifications to second-tier benefits, considerable gaps in mental health and maternity care remained.
“We’re [also] keen to see more product simplification of the gold, silver, [and] bronze tiers. It’s time for a review, including really taking a look at how we improve the transparency and understanding of health insurance products,” she said.
The consultation paper also highlighted the need for a fit-for-purpose regulator, she said.
“One small change [to the PHI system] can have significant flow-on effects, so we do think there needs to be an overarching authority, and it needs more serious consideration than it’s received.”
In relation to mental healthcare, the AMA said the consultation paper failed to address key proposals previously put to the DoHDA, including increasing MBS and private health insurer remuneration for psychiatrist inpatient care.
It also pushed back on exempting IMG psychiatrists at a district of workforce shortage (DWS) practice location from seeing a patient whom they admitted to a non-DWS-based private hospital in person.
Currently, under MBS telehealth item 92483, new patients admitted to hospital via video telehealth must be seen by the admitting psychiatrist within 48 hours.
“This is an important safety value, both for the patient and the psychiatrist,” the submission read.
“Who will indemnify the overseas-trained doctor if something goes wrong?”
The AMA warned the new proposal would create an exception to the 19AB Medicare rule, letting overseas-trained psychiatrists access MBS items in private hospitals – most often in cities – risked the removal of psychiatrists from the most underserved regional and remote areas.
Amending MBS case-conferencing items to remove barriers to care, such as allowing conferences to include only the psychiatrist and the patient’s GP, were also welcomed.
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The paper’s framing that a lack of “awareness” of innovative care models was preventing private maternity care was strongly rebuked by the AMA – “[it’s] the least of the problems facing the private maternity sector”, the submission read.
“Any ‘sector’ education needs to be directed towards state governments and public hospital administrators.”
Instead, the AMA’s submission highlighted the lack of private hospitals providing obstetric care outside cities and the more than 14 private maternity units across the country that had closed over the previous five years.
The “failure” of PHI to index hospital rebates to rising care costs means many women – even those who are high-risk – may be unable to afford out of pocket costs or to use their cover locally due to private hospital closures, the AMA said.
“If nothing changes, by 2030 there won’t be enough private births to keep remaining private maternity units open,” the submission read.
“The Australian Government must make it a priority to negotiate with the states and territories to ensure that level four and five public hospitals allow private obstetricians to work there, so that patients have a choice.”
The AMA called for mechanisms that would enable PHI consumers to purchase or upgrade to an equivalent no-wait, gold-tier maternity cover at a discount if they unexpectedly fall pregnant, or to obtain a one-off standalone maternity cover if they haven’t had insurance before.
However, the association broadly supported several proposals, including the HITH reforms and a proposal for two new Type C certification exemptions – for patients aged 75 years or older and for procedures performed under general or regional anaesthesia or IV sedation.
“[This will] reduce administrative burden on clinicians, hospitals and insurers, and lead to greater certainty for patients with the respect of access to care and OOP costs,” the submission read.
The AMA also supported extending Type C exemption criteria to patients aged five and under, those required to travel more than 100 km for a service, adjunct procedures related to the primary reason for admission, and late-day submissions.
It also called for audits of insurer calculations and transparency of second-tier rates to prevent exploitation.
Read the submission here.
