Private patients reap public benefits

Private health insurance funding of stays in public hospital has grown twice as fast as admissions to private facilities, a new Australian Institute of Health and Welfare (AIHW) report reveals.

In 2015-16, about one in five admissions that were privately funded occurred in public hospitals. This was up from one in seven nearly a decade ago, according to the report, Private health insurance patients in Australian hospitals, 2006-07 to 2015-16.

The study also showed that patients aged 75 and over were more likely to be placed in a public hospital by a private fund than any other demographic.

“When looking at the types of admissions and services provided, medical care was the most common type of service provided for private health insurance-funded admissions in public hospitals, and surgical care was the most common in private hospitals,” it reported.

Additionally, privately funded patients appeared to be treated more favourably, for example their waiting times for elective surgery was shorter than it was for public patients.

 On average, privately funded patients waited about 20 days compared with 42 days for public patients and 18 days for other patients.

“When looking at knee replacement surgery, the median waiting time for private health insurance-funded patients was 76 days, compared with 203 days for public patients,” said AIHW spokesperson Jenny Hargreaves.

“Private health insurance-funded patients were more likely to be categorised as needing this surgery relatively urgently, with 43 per cent requiring knee replacement surgery within 90 days. This compared with 25 per cent of public patients.”

Opinion: think before you bank on this insurance advice

The statistical analysis conducted by the Australian Institute of Health and Welfare (AIHW) should silence the detractors who are increasingly bashing health insurance for the wrong reasons.

Last week, esteemed investment bank Morgan Stanley said in a lengthy report for clients that buying health insurance was a waste of money because … wait for it … the free public hospital system was the bees’ knees.

News Corp, which obtained the report, quoted Morgan Stanley Executive Director Daniel Toohey as writing that “the private health industry had become lazy and the Government should refuse any premium (rises) until the industry sorted itself out”.

It’s true, there is much to begrudge health insurers – their steadily rising premiums that seem to cover fewer and fewer treatments, for one – but for the silvertail bank to champion sitting among the sick and wounded for hours in emergency before seeing a doctor, like most users of public hospitals do every day, is a bit rich.

In a “nothing to see here” assertion, the bank said: “The picture is not as dire as the media would suggest (of a public system at breaking point, evidenced by crowded emergency departments and ballooning elective surgery wait times).”

And it advised: “People who are grudge purchasers of health insurance will be better off paying the Medicare Levy Surcharge than buying insurance.”

But its most incredulous claim was that the public sector could right now feasibly absorb the excess demand caused by an ageing population and falling private hospital admissions.

Really, Mr Toohey? If you were very ill, would you stoop to rub shoulders with the masses in a smelly, overcrowded and noisy admissions waiting room?

If he took his firm’s advice and ditched paying for private health care, it wouldn’t be long before he would likely regret it if he needed a new knee. According to AIHW, if he were a private patient in a public hospital, he would likely wait just over two months before being wheeled into theatre. If he went for the procedure as a public patient, his wait would be closer to eight months.

Thankfully, Private Healthcare Australia chief Rachel David wasted little time in dismissing some of the bank’s conclusions as incorrect and very naïve.

 “Wait times for elective surgery in public hospitals extend to years and the public system can’t quickly treat disabling sporting injuries, eating disorders, weight-loss surgery, chronic severe anxiety and depression,” Ms David was reported to have said.

Sounds like Mr Toohey et al have been schooled.

Would you ditch your private health cover if you have any? Do you have as much faith in the public hospital system as you do in the private sector?

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