Private healthcare in Australia is on the brink of a massive change.

The massive change could affect millions of Aussies in the process.

Healthscope, Australia's second-largest private hospital operator, terminated its contracts with two major health insurers, Bupa and the Australian Health Services Alliance (AHSA).

Healthcare's bold step followed after a standoff over a proposed hospital facility fee.

The proposed fee would range from $50 for same-day patients and $100 for overnight admissions.

Health insurance is important, especially for seniors who rely on it for regular check-ups. Image Credit: Pexels/Leeloo The First

Healthscope argued it was necessary to bridge the gap between insurance payouts and the rising costs of hospital care.

However, Bupa and AHSA refused to agree to the said fee and threatened legal action to prevent its implementation.

Healthscope will terminate its contract with Bupa by 20 February 2025

Meanwhile, its contract with AHSA will end by 4 March 2025.

This sudden change could affect around 6.6 million Australians, who may face higher out-of-pocket expenses for treatments at Healthscope hospitals.

Healthscope also confirmed that Medibank, nib, and HCF members will not be affected.

'In an environment of rising costs and private hospital closures, it is unacceptable for insurers to fail their core purpose—funding the care of their members, particularly those like Bupa who are boasting of record profits,' Healthscope CEO Greg Horan stated.

The private healthcare sector has seen the closure of 70 private hospitals within the past five years, indicating an 'unsustainable' trend.

The recent shutdown of a new private hospital in Melbourne's west after 14 months of operations, along with the closure of several private maternity services, underscored the fragility of the current healthcare system.

Private Healthcare Australia accused Healthscope, owned by North American private equity group Brookfield, of 'throwing its toys out of the cot'.

Private Healthcare Australia's CEO, Rachel David, stated that fee increases would inevitably lead to higher premiums.

This increase could cause them to downgrade their insurance or drop their coverage.

AHSA CEO Andrew Sando has echoed Ms David's sentiments.

'How and why the Australian government permits foreign private equity owners such as Brookfield to extract more profits from the already financially challenged private health care system is unclear,' Mr Sando said.

Mr Sando then reassured AHSA policyholders that they would still have access to healthcare under their extensive network of hospitals and providers.

Bupa expressed its disappointment over Healthscope's decision and emphasised its commitment to finding a solution that prioritises customers and patients.

Bupa CEO Nick Stone assured members that there will be no immediate changes to their coverage.

Additionally, other private hospital options should be available for Bupa members by February 2025.

The Australian Private Hospitals Association (APHA) warned that the standoff was indicative of a more significant problem.

According to APHA, private hospitals are underfunded by insurance companies.

CEO Brett Heffernan pointed out that despite inflation, the average payment received by hospitals from insurers has decreased over the years.

As the situation unfolds, the outcome could have significant implications for the future of private healthcare in Australia.

For those who rely on private health insurance for timely and quality medical care, the potential for increased costs should be a concern.

Key Takeaways

• Healthscope terminated its contracts with insurers Bupa and AHSA due to a dispute over a proposed hospital facility fee.
• The contract termination will affect around 6.6 million Australians with private health insurance through these companies.
• Private Healthcare Australia criticised Healthscope's move, while Healthscope defended its decision based on rising healthcare costs.
• Once the terminations proceed, affected policyholders would still have access to care at other private hospitals within their insurer's separate network of hospitals and healthcare providers.

What are your thoughts on this issue? Do you have concerns about the future of your private health insurance? Share your experiences and opinions in the comments below.

 

[MaggieMay1948]

This has been brewing for a long time. And we have politicians to thank for selling our new hospitals, which should have been public, to foreign providers (Brookfield/Healthscope) for $1 to operate as part private, part public. The private equity company has broken its contracts anyway by not providing all the services it was meant to provide with the result wechave bbew hospitals closing down ir wards and specialists services either never opened ir cut back.

the part private/part public system was was never going To work. Whatever were our politicians thinking? Well obviously they weren't. Everything they touch turns into a mess. Every public service they've sold off to private enterprise has been an abhect failure. Public transport is another debacle. And plans for mass building is another disaster in the making. Anything that gets built now will be slums and ghettoes with 20 years.

 

[Therese47]

I cannot understand the Australian Government lets Healthcare to be outsourced and run by a company that is a foreign provider who sees only one thing to “maximise shareholders wealth”. It should be only operated by an Australian Company. Australian Government to fund the Health system.

 

[NotNats]

when the Government sells of Australia stuff its only benefit is to help fund the overseas company to keep funding things in their own country - FULL STOP.

Australia is NO LONGER the so-called lucky country as the government has sold us down the shithole.

 

[Dynamo]

I cannot understand the Australian Government lets Healthcare to be outsourced and run by a company that is a foreign provider who sees only one thing to “maximise shareholders wealth”. It should be only operated by an Australian Company. Australian Government to fund the Health system.

You have written well and covered what many of us think. Thank you.

 

[Isis]

If my hospital of choice is affected I am out of bupa . Simple as that. I pay a heap of money to go where I want to go so I vote with my feet.

 

[Trina G]

I didn’t know any of this. The one question I have is who sold off the hospitals to an American organisation? We all know how horrendous healthcare is in America. Why do governments have to privatise everything they can? We saw that big time in Victoria when Kennett was in power and now we have to pay the ongoing price of that decision.

 

[Trina G]

If my hospital of choice is affected I am out of bupa . Simple as that. I pay a heap of money to go where I want to go so I vote with my feet.

Totally agree. I’m also with BUPA. BUPA da profits is their motto.

 

[Tigers]

I PAY TOO MUCH now as it is. WHAT THE HELL is an overseas company doing running this show, anyway. they ARE IN IT TO MAKE A PROFIT. i aggree with Tina DA PROFITS IS THERE MOTTO. i will DEFINATLEY BE VOTING WITH MY FEET a a retiree i allready pay OVER $200.0 PER mth,, am with bupa as well.

 

[Mr Chips]

I don't know why there is a problem here. Just because our private hospitals have nice surroundings, efficient systems, highly skilled medical staff and very much including great nurses, fluffy pillows, comfortable beds, private rooms with great room service, etc are not much different from the public hospitals where they are old or clinical inside, systems falter, trainee staff who sometimes struggle with their command of English which is a worry when they look at your diagnosis, uncomfortable beds with flat pillows (lucky if you get more than one) shared rooms with room service that takes up to 2 hours to respond etc. Just where is the issue?
I have spent a few sessions in our local public hospital and they are great so I would not suggest that the above applies to all public hospitals but there are a few real comparisons there,

 

[Isis]

I don't know why there is a problem here. Just because our private hospitals have nice surroundings, efficient systems, highly skilled medical staff and very much including great nurses, fluffy pillows, comfortable beds, private rooms with great room service, etc are not much different from the public hospitals where they are old or clinical inside, systems falter, trainee staff who sometimes struggle with their command of English which is a worry when they look at your diagnosis, uncomfortable beds with flat pillows (lucky if you get more than one) shared rooms with room service that takes up to 2 hours to respond etc. Just where is the issue?
I have spent a few sessions in our local public hospital and they are great so I would not suggest that the above applies to all public hospitals but there are a few real comparisons there,

No complaints about public hospitals in my long life spent time in a few. But if I can afford insurance to go to the hospital of my choice, it’s not all about a bit of luxury but the fact that if I break a hip or need instant care I get it. Two knee surgeries done within a week while a friend still waiting in pain for a year to go public

 

[Jash]

I have always paid Health Ins. have wondered why at times!!. Have been in two public hospitals in Tasmania the last three months & went private, that was so they could get back the money from my private insurer. Absolutely no complaints with the care I received from firstly being in a four bed nor the two bed ward. Will be thinking hard whether too continue next August this wrought we pay for dearly.

 

[Mr Chips]

No complaints about public hospitals in my long life spent time in a few. But if I can afford insurance to go to the hospital of my choice, it’s not all about a bit of luxury but the fact that if I break a hip or need instant care I get it. Two knee surgeries done within a week while a friend still waiting in pain for a year to go public

Totally understand especially if there are no specialists in your area covering your particular needs.
I recently had an artery scan which required a camera to be inserted in my groin area and down the main artery of my leg to the foot. It was done under some wonderful substance that did not put me to sleep and so I sat up and chatted with the surgeon under the whole procedure. The interesting thing was that it could not be done by the local public hospital so they sent me to the private hospital to perform what was a painless operation.
What I really enjoyed was being in a comfortable bed with lots of fluffy pillows in recovery and I will never forget that the lovely nurse asked me if I would like a sandwich or cup of tea or anything. I asked for a sandwich and tea please expecting what I was used to from the public system. Along she came with this beautifully made ham and salad sandwich on fresh bread with an actual TEAPOT with an actual CHINA CUP and SAUCER. It was just so nice. Shame it was only same-day surgery.

 

[Benny's Light]

Health care has become a big business all about bottom line and profit owned by multi-nationals. The notion of care and providing a service for its patients (customers) is not as important as to the profit margin that procedures can produce for the business. This is what we have to deal with - money drives everything! What a mess most of our big systems are in - health, education, transport, electricity and simple purchase of food that is affordable. Gone are the good days - the price that we pay for progress.

 

[MIZMAC]

Here we go again. Companies sold to overseas and all our costs go up. Who was stupid enough to offload anything to do with health to USA Everyone knows they are the most costly.

 

[IAN3005]

I cannot understand the Australian Government lets Healthcare to be outsourced and run by a company that is a foreign provider who sees only one thing to “maximise shareholders wealth”. It should be only operated by an Australian Company. Australian Government to fund the Health system.

Go figure!!!

 

[VM53]

No complaints about public hospitals in my long life spent time in a few. But if I can afford insurance to go to the hospital of my choice, it’s not all about a bit of luxury but the fact that if I break a hip or need instant care I get it. Two knee surgeries done within a week while a friend still waiting in pain for a year to go public

Agree. The only way now to get instant treatment is to go to a Private Hospital. There is nothing wrong with the care given in Public Hospitals, it’s just that you have to wait a year or more to get in. Not feasible for urgent stuff.

 

[Wattoval]

Australia has sold out in just about everything, the Governments in the past and now more so recent, do not care as long as they are getting the kick backs.
Who in their right mind, sold Australian Health Care to an American Company, only need to look at their medical health insurance to know that it’s only for the wealthy.
Unfortunately we are going down the same path, many cannot afford Private Health Insurance, which in turn puts enormous pressure on the Public System.
The future here will be same as the USA, if no insurance, no medical care and people will die in the streets.
Healthscope don’t care less about individuals, it’s all about making the big bucks.