According to a new report more Australian privately insured patients used the public hospital system last year than previously and there are concerns that encouraging people to take out private health insurance is doing little to reduce the burden on the public health system.
According to the report by the Private Health Insurance Administration Council (PHIAC), private patients spent an extra 150,000 days in public hospitals in 2007-2008, an increase of 10% which equates to 1.8 million and represents twice the growth of recorded by private hospitals.
With private health funds lobbying for a reported 6.5 to 7.3% increase in premiums for next year, these latest figures will add fuel to the debate over whether private health insurance does in fact take the heat off public hospitals.
Some believe the statistics merely reflect pressure from the public sector for people to identify their health insurance and it has been suggested that public hospital administrators are enhancing state health revenues by requesting that the privately insured admit themselves as private patients.
This has been rejected by the Australian Healthcare and Hospitals Association, which represents the public health sector, as not a true picture of what the figures show and action which would be illegal.
At present Canberra requires that all patients be given access to free public hospital services, and they are not forced to use their private health insurance to fund their treatment and other states want the same level of health fund payments for private patient stays in their hospitals as received by the private sector.
The PHIAC report indicates that daily health fund benefits for acute patient beds in 2007-08 rose by 2.1% to $294 for public hospitals, compared with 4.9% to $798 for private hospitals.
Dr. Michael Armitage from PHIAC says health funds expenses had soared and 10.4% more was paid out in total benefits this year than last year - some health funds have in fact record negative net margins in 2007-08 which has prompted the AHIA to commission its own analysis of funds' investment returns, capital adequacy and long-term viability.