New body parts will soon be cheaper for Aussies

Targeted reviews of prostheses will soon begin as the Turnbull Government continues to work with the private health insurance industry to make premiums more affordable for all Australians.

Prostheses like artificial hips and knees are responsible for nearly 14 per cent of hospital benefits paid by private health insurers.

The Coalition Government’s recent announcement that the Prostheses List Advisory Committee (PLAC) has set out a process to review benefits and devices in the hip, knee, cardiac and spinal categories, has Private Healthcare Australia applauding.

“(It) will deliver significant savings to health fund members and Government,” PHA chief executive Dr Rachel David said.

“ISPOS research shows that 84 per cent of health fund members value their PHI but are concerned about ongoing affordability.

“This announcement demonstrates the Coalition Government is serious about reducing household costs.”

Dr David said health funds had stuck to their commitment to pass on all savings from the current reform of the Prostheses List.

“This was demonstrated in the recent premium round with the average increase being the lowest in a decade,” she said referring to earlier this year when the Government successfully provided price cuts for around 2,400 medical devices.

Those reductions will deliver nearly $500 million in savings over six years to patients and PHI members.

“This next round of reviews will deliver further savings,” Dr David said.

“Health funds will continue to work closely with the Government to ensure the sustainability of the PHI industry and funds will continue to introduce efficiencies to keep their internal costs down.”

Further analysis of public and private hospital data by the Independent Hospital Pricing Authority found that better value could be reached for many of the 11,000 devices on the Prostheses List.

Australia is one of the most expensive countries in the world to replace a dodgy hip or bung knee as foreign companies importing prostheses charge Australian health fund members the highest prices in the world.  

Dr David explains: “Current Prostheses List regulations have forced health funds to pay benefits for medical devices two to five times higher than the price charged for the same device to public patients, and in equivalent countries around the world.

“This has put direct upward pressure on heath fund premiums.

“Fixing medical device prices is highly inflationary and a huge source of waste in the health system that can be addressed without impacting the quality of medical care at any level.

“Keeping private health insurance sustainable and premiums affordable ultimately benefits all Australians by keeping pressure off the public hospital system.”