Gap charges causing hip-pocket pain

Privately insured patients face out-of-pocket medical costs amounting to thousands of dollars much more frequently than official figures indicate, according to the Consumers Health Forum (CHF).

While the official figure on medical gaps from the Government regulator APRA states that on average 88 per cent of private hospital medical services have “no gap”, industry figures show that, for many surgical procedures, the rate of gap charges is actually much higher.

That reality is being borne out in early responses to CHF’s Out of Pocket Pain survey, which after a week and over 600 responses is showing that significant numbers of respondents are paying gap costs, often more than $1000 and ranging up to $20,000.

Data collected by Australia’s biggest health fund, BUPA, shows that for common operations such as knee replacement, fewer than 40 per cent of operations are performed where no gap is charged and 39 per cent of the operations drew out-of-pocket costs averaging $2001-$5000. 

For some prostate operations, only 17 per cent had no gaps, while more than a quarter of patients had out-of-pocket bills of more than $5000.

Research by the Breast Cancer Network Australia shows that many women with breast cancer face similarly high costs.

The official no-gap figures published by APRA count all in-hospital medical services. CHF suggests the figures are skewed by the numerous low-cost procedures that count towards a person’s overall ‘basket’ of services that do not have a gap charge, such as pathology tests and radiology.

“The confusing nature of these figures highlights the need for much simpler, clearer private health care and insurance arrangements,” CHF CEO Leanne Wells said.

 “Many private patients are questioning the value of health insurance when they have to pay so much more in out-of-pocket costs for services they expected to be covered by insurance.

“It is clear that a Productivity Commission inquiry is necessary to investigate the nature and reasons for this state of affairs.

“Our political leaders must address this issue effectively if we are to retain decent access to health care for all,” Ms Wells said.

Have you ever been caught out having to pay high out-of-pocket medical costs? Has having private health insurance saved you gap costs? Should health insurers be obliged to pay the full cost of procedures they cover, as car insurers do?

Written by Ben

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