The Australian Medical Association (AMA) has warned that proposed changes to the Private Health Insurance (PHI) could cause Australians to be abandoned by insurers, further straining an already struggling public health system. increase.
this is federal government is about to make some of the most significant reforms to PHI in over a decade, including lifetime health coverage incentives and the use of risk equalization.
Risk equalization (RE) basically means that funds from insurers with lower average claim costs are transferred to insurers with higher average claim costs. It is argued that this better supports community ratings because PHI is a community rating and everyone on the same policy pays the same premium regardless of expected claims costs.
Under the current Australian healthcare system, PHI operates under community assessment and acceptance is guaranteed. This means that health planners cannot deny coverage or charge higher premiums to individuals who are expected to charge more based on their health and needs. means
This is underpinned by retrospective risk equalization based on age, where a subset of claims costs for PHI customers aged 55 and over are pooled and spread across all customers.
However, the AMA has warned the federal government not to use risk equalization to make PHI more affordable for Australians.
and statementthe AMA argues that while risk equalization may help insurers minimize costs, it does so by creating a system that may reduce patient choice and physician clinical autonomy. Said he would do it.
“Therefore, the AMA does not support a future move to risk equalization, especially because we do not believe that adequate safeguards are in place to protect patients,” the AMA said.
In submissions to the government (pdf), Australian healthcare providers peaked because the proposed use of risk equalization would increase pressure on contracting hospitals, reduce diversity and choice, especially outside metropolitan areas and in rural areas, and force health insurers to He said he was also concerned about encouraging the creation of low-cost options for patients. Care that does not result in better clinical outcomes.
They also put pressure on practitioners to enter into contracts with PHI that set targets for them to meet insurers’ financial goals, which can limit clinical autonomy and compromise patient outcomes. I am also concerned about my sexuality.
Australians with a chronic or complicated medical history may be excluded
The AMA also noted that PHI may come to seek and collect data on Australians. This creates a data arms race to help the customer base achieve lower billing costs than expected.
“Sadly, this includes setting exclusion criteria in programs that only allow low-risk members to claim or exclude more expensive treatment options that may be more clinically appropriate or desirable for their patients. may include,” said the AMA.
“While this is effective in lowering premiums, it does so at the expense of highly dependent and high-risk categories of patients. It will further reduce costs for the company, so it will not have a negative impact on keeping expensive patients away.”
Government report calls for change
However, a federally commissioned report on risk equalization from Infinity Consulting (pdf) argued that the current PHI system encourages risk selection, resulting in inefficient health coverage because Australians with specific health needs are disadvantaged to PHI. increase.
The report argues that Australia should adopt a hybrid RE system that redistributes PHI income (a form of risk adjustment) based on age, gender and other policyholder characteristics.
Countries such as the Netherlands, Switzerland, Ireland, and the United States have criticized PHI for risk, citing the use of a “risk adjustment” in which RE payments are based on expected claims costs rather than actual claims costs. It claims we can stop choosing customers based on , “while maintaining (for the most part) incentives for efficiency”.