The Geelong Clinic terminates contract with GMHBA

Accessing the region’s only private inpatient mental health clinic could become more costly for patients after negotiations with health insurers failed.

The Geelong Clinic will no longer be a part of GMHBA’s participating private hospital list.

Patients accessing the region’s only private inpatient mental health clinic could face increased out-of-pocket costs after negotiations failed between its operator and a number of health insurance providers.

Healthscope, operator of the Geelong Clinic in St Albans Park, made the decision to terminate its contract with Geelong-headquartered insurer GMHBA.

The Geelong Clinic is one of 38 hospitals under the Healthscope umbrella and is the only Healthscope hospital in the Geelong region.

A spokesman from Healthscope said it had been unable to agree on fair commercial terms with Bupa and all health funds which are members of the Australian Health Service Alliance (AHSA), which include GMHBA.

“This has left us with no option but to advise the AHSA that we will be terminating our contract with them effective from March 4, 2025,” the spokesman said.

“There is no change or impact at this point for members of AHSA health funds, they can continue to be treated in Healthscope hospitals including The Geelong Clinic.

“After the contract termination date, patients can still be treated in our hospitals, however they may face additional out-of-pocket charges.”

Healthscope said it did not want to be adding to patients’ financial uncertainty during a cost of living crisis.

“However, we cannot allow some insurers to undermine the viability of private hospitals by refusing to fund their costs,” he said.

“In an environment of rising costs and private hospital closures it is simply unacceptable for health insurers to fail at their core purpose – funding the care of their members.”

Andrew Sando, CEO, Australian Health Service Alliance.

In February 2024, GMHBA renewed its contract with Healthscope, which included annual funding increases.

In an email sent to customers, GMHBA said Healthscope informed it, and other AHSA funds, of its intent to charge an additional hospital facility fee to their members.

“GMHBA opposed the introduction of this hospital facility fee as it would have increased out-of-pocket costs for our members and was not permitted under our contract,” the email said.

“GMHBA believes the rates we pay Healthscope in our current contract are fair and reasonable.”

AHSA chief executive Andrew Sando said the organisation and its member funds were sympathetic to the cost pressures faced by private hospitals.

“Our mission is to ensure members have access to affordable, quality care, when and where they need it,” Mr Sando said.

“We are committed to constructive negotiations with Healthscope on behalf of our member funds, and to ensuring all Australians maintain access to high quality private healthcare.”

Mr Sando said policy holders of the not-for-profit and member-owned insurers potentially faced out-of-pocket gaps if they decided to be treated or are admitted to a Healthscope hospital.

The spokesman for Healthscope said it would continue to negotiate with Bupa and AHSA health funds in the hope of reaching an agreement that removed the need for their members to pay additional out-of-pocket costs. ​

Originally published as The Geelong Clinic terminates contract with GMHBA