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Tackling the backlog in elective surgery

7 Jun 2022, by Amy Sarcevic

The cessation of elective surgeries during the COVID-19 pandemic continues to present a challenge to the Australian healthcare sector, with both public and private clinics struggling to work through a backlog of some 400 000 cases.

Wait times for certain category 2 procedures – which are typically required within months – have blown out, in some instances, to years, with patients deteriorating as a result.

Even well-resourced clinics are facing challenges, with the Royal Melbourne Hospital recently stating its elective surgery waitlist had increased by 15.9 percent in the preceding six months.

Aside from the health costs to individuals, public and private providers have the added pressure of dealing with conditions that may have deteriorated due to treatment delays, highlights surgeon, Professor Owen Ung.

He says under, these circumstances, the healthcare sector should avoid patch-up remedies, like absorbing public patients through the private system.

“A system adopted by some public hospitals to outsource activity to the private sector to catch up with waiting lists may seem a good solution on face value. But it doesn’t reinforce the need for PHI, if patients can enter the public system and still have their procedure performed privately,” Prof Ung said ahead of the Health Insurance Summit hosted by Informa Connect.

“Additionally, there are ethical implications if a private patient is in the adjacent bed to someone who has not paid an insurance premium – and possibly further out of pocket expenses – for the same experience. These sorts of incursions do little to support the notion of paying for the privilege of premium health care.”

PHI Sustainability

This approach could also have implications for the sustainability of the healthcare system and the private health insurance industry.

“In my view the public and private healthcare system are very symbiotic – one cannot work without the other,” Prof Ung said. “If people in the community are dropping PHI because they no longer see the value proposition, they will flow into public sector, putting further pressure on that system. Over time, rising PHI premiums and out of pocket expenses will further push consumers away from the industry.”

With the bulk of these departures being younger and healthier consumers, the “death spiral of PHI is real”, he warned.

“The consequences of all of this will be felt profoundly, not just in terms of PHI profits but, more importantly, in national health outcomes. Whilst other insurances are risk rated – for example, you pay a higher premium for your house insurance if you are located in a fire hazard location – health insurance is community rated. Such premiums are determined by what the policy offers rather than what the consumer is likely to claim.

“Moreover, there is a portion of the population that we absolutely must look after in public system, as they will never have the resources for private care. If more and more people who have the resources to contribute to their own health needs don’t take up – or drop – PHI, they will further compound the reliance on the public hospitals system, stretching resources and prolonging wait times for all. We have to find better solutions.”

That said, simple solutions may be on offer. Reframing the value proposition for PHI could help draw in younger consumers and keep in the system in kilter.

“When you have car insurance, you don’t buy it with the intention of drawing down value by having a car crash, but you have got to have it just in case. People need to view health insurance with the same lens. They may not need it right away but will thirty years from now,” Ung said.

Correcting community misunderstandings about the role of Medicare may also help. At present, Ung argues that political rhetoric does little to dispel the misunderstandings, with healthcare funding often seen as a hot-button issue.

“A great misunderstanding, in my observation, is that Medicare funds public health, when in fact it is primarily to support privately accessed care i.e. private visits to the GP or specialist or services provided by them in private hospital facilities.

“Also, Medicare is not a payment to a doctor but a rebate to a patient set at less than the schedule fee and over time, well less than usual or ‘common’ fees in many instances. The blurring of State and Federal health funding is exemplified in the cost shifting that occurs by Medicare and PHI funded services in our public hospital systems.

“Apart from significantly more public health funding, there is also a need for greater honesty and transparency in how the system is funded.”

Prof Owen Ung is Director at the MNHHS Comprehensive Breast Cancer Institute and a Surgeon at the Royal Brisbane and Women’s Hospital and STARS. He is also a Professor at the School of Medicine, University of Queensland.

Giving further commentary on this issue, Prof Ung will address the Health Insurance Summit hosted by Informa Connect, held 28-29 June at the Swissotel Sydney.

Learn more and register your place here.


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