Why private health premiums are set to soar
HALF of all health fund members will have to pay higher premiums and switch to top cover policies to be insured for hip and knee replacements under major reforms.
And they could then face a 12-month wait before their health fund will cover them for the procedures even if they do switch to top cover.
Australian Medical Association president Dr Tony Bartone has defended the changes and says the 12-month wait for surgery is the price we have to pay for a better system.
"If a 12-month wait is the consequence that leads to a more affordable and value added proposition for health insurance, it's part of the trade off," he said.
However, the Australian Orthopaedic Association said there was "real risk that insurance categories will influence and/or modify the type of care for patients, at the expense of quality care".
When asked whether people on medium and basic policies forced to switch to top cover to ensure they were still covered for hip and knee surgery would face a 12-month wait Private Healthcare Australia chief Rachel David said "I just don't know the answer to that quite specific example".
The Consumer's Health Forum said cover for joint replacement is indeed a major reason why people take out insurance and "in any set of PHI arrangements there are going to be winners and losers".
"The dilemma remains that the more procedures included in silver and bronze, the more upward pressure on premiums across the board," Consumer's Health Forum chief Leanne Wells said.
Hip and knee replacements are the most claimed procedures by health fund members and currently 77 per cent of those with medium and basic health insurance are covered for the operations.
However, under the federal government's attempt to simplify health cover into Gold, Silver Bronze and basic policies, hip and knee replacements only have to be covered by top cover policies.
Legislation to give effect to the reforms is due to be debated in federal Parliament next week and medical device manufacturers say consumers are in the dark about the effect of the reforms and they are calling for a 12 month delay before they are implemented.
"The additional time would allow the Government to make available to stakeholders the modelling used to establish the new categorisations and the impact on current policies," Medical Technology Association of Australia CEO Ian Burgess said in a letter to the government.
"It would also allow sufficient time to establish a public information campaign to help consumers be better informed about the product tiers and their inclusions as recommended by the Senate Community Affairs Legislation Committee," he said.
The call for a delay was backed by Australian Healthcare and Hospitals Association chief Alison Verhoeven.
"There has to be sufficient time for people to know what these changes mean, what has been most objectionable is that there has been no public conversation about these major health reforms," she said.
A spokesman for Health Minister Greg Hunt said "the Morrison Government is making private health insurance easier to understand and more affordable."
"The reforms will not increase costs. Any claims to the contrary are false," the spokesman said.
Despite claims the reforms would simply the system into four basic product type the government now says health funds can offer additional procedures in basic plus (+), bronze plus (+) and silver plus (+) tiers.
"For example a private health insurer can offer silver plus knee replacement cover," Mr Hunt's spokesman said.
Opposition health spokesman Catherine King said the reforms were creating chaos and uncertainty.
"The Government must come clean. Will people be forced to pay more to maintain their current level of coverage? Or will they be forced to accept a lower level of coverage because they cannot afford to upgrade?" she said.