Peter Dunne and Southern Cross Healthcare want the Government to subsidise private health insurance.
Superficially, the argument that incentivising the use of private healthcare (specifically elective surgery) in the hope that it will reduce the burden on the public system and cut waiting lists makes sense.
But, like so many ‘common sense’ policies, a closer look at the details reveals more than a few fishhooks. To me, there are two principal problems with this policy: Workforce capacity and acuity.
The fact is that most surgeons working in the private sector also work in the public sector. There isn’t a bunch of bored private sector surgeons sitting around awaiting a flood of subsidised patients to come through the door. Until that changes, sending more patients to private surgical hospitals will simply draw resources away from public hospitals, exacerbating the situation for those who cannot afford health insurance. That will increase health inequalities, a concern expressed yesterday by health economist Robin Gauld.
Then there is the problem of complicated surgeries. Private hospitals only take the most straightforward cases. That is not meant to be a disparaging comment, it’s just a fact that private hospitals are not set up to deal with additional complications that may arise from other conditions the patient may have – it’s not their core role.
So, many people (particularly older people) with insurance will still need to use the public sector in order to get the additional care required to get them safely through the surgery.
Australia has strong incentives for those earning over $100,000 to take out private health insurance. This was a topic of discussion on the recent Health Select Committee visit to Australia. One of their ministry officials told the committee that many people who take out insurance will still often use public hospitals precisely because of the additional care that is available. His personal view was that the effective relief on the public system is negligible.
There is a role for the private sector in health care. But if there is money to spend in the health system, there are more cost-effective and future-focussed places to put it than private surgical hospitals.
Not sure about whether subsidization is the right move given the fact that, like you say, private isn’t always better in terms of complicated procedures, but a tax rebate of one’s private health insurance along with private school fees would be a fair call.
Apparently there is a steady stream of patients allready in private hospitals who are then sent to public hospitals.
( Are the public ones reimbursed ?).
As they dont have critical care facities and sometimes they dont wont let the patients stay over the weekend- ruins the surgeons time off
No wonder they have lower costs. No training done at private hospitals either
@Rebecca: Wouldn’t that just provide perverse incentives for the private insurers to collect as much premium (backstopped by the taxpayer, essentially) in exchange for as little service as possible?
Sure, regulation and audit could address this but you may end up no further ahead in delivery of actual services.
Even Treasury has been sceptical of the idea.
“We recommend you note that the cost of subsidising private health insurance would far outweigh the fiscal benefit in terms of reducing demand on the publicly-funded health system.”
You know, public hospitals are dens of management opposites.
In some areas, there are strong areas of leadership and management excellence. People with great attitudes.
In some other areas and departments there is just **** leadership and management which acts to constrain even the best areas. People with **** attitudes.
Get this sorted out first IMHO before gifting resources to the private hospital – a system which as gwwnz pointed out has few responsibilities in supporting to the rest of the healthcare sector.
Not sure what a tax rebate for private schools as well would achieve, they allready recieve direct government funding and subsidies , increased in last budget.
Why on earth would any correct thinking person suggest a taxpayer paid subsidy for a private profit making organisation.
It would make little or no difference to the public health sector performance. Like many private organisations, any money for nothing would go straight to the bottom line then to the shareholders. Great if you can swing it.
Same with schools.
My experience as a user of both public sectors is excellent, as usual, the workforce generally do a very good job with the tools they have available. All the other stuff can be attributed directly to poor management. Sort that and the rest will follow.
any money for nothing would go straight to the bottom line then to the shareholders.
Maybe this doesn’t apply somehow, but Southern Cross (800,000 customers) has no shareholders as it’s a non-profit. Not quite sure how this works but that’s the case.
My experience as a user of both public sectors is excellent
Might not be so good if the ~1.2 million health insurance holders went back into the public system would it…
GWW @11:56 am
Like rainman says, maybe regs could cover this but sounds complicated. I’m vaguely aware of countries overseas successfully keeping prices under control (France, health anyway) so perhaps not impossible.
StephenR said:
It would be an interesting result if their insurance premiums also went back with them.
I heard Southern Cross’ director on the radio yesterday asking for subsidies for elderly people, who are facing massive increases in costs which is a different kettle of fish than accross the board subsidies…
My advice:
Lets shamelessly copy the French Health System…
It would be an interesting result if their insurance premiums also went back with them.
If the government raised taxes?
Lets shamelessly copy the French Health System…
Yes.