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.
