Private health cover: Patients to pay more as Ramsay Health Care and BUPA go to war
Patients will be slugged thousands of dollars for surgery in the private sector as a major health fund and hospital group clash. See which hospitals are affected.
National
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Millions of members of a major Australian health fund are facing a massive hike in out-of-pocket costs when they use hospitals owned by the nation’s largest private hospital group.
Ramsay Health Care, which owns 99 private hospitals, day surgeries and mental health clinics has terminated its contract with health fund Bupa and its four million members after failing to win agreement for a price increase for its hospital services.
Neither party would comment on the negotiations but News Corp understands Ramsay was seeking to raise its prices by double that of other hospitals.
Bupa was believed to have offered a rise of around 1.4 per cent.
General inflation rose by more than 5 per cent last week.
Failure to reach agreement means Bupa members booked for an operation from August 2 will face extra out-of-pocket hospital costs, Australian Medical Association president Dr Omar Khorshid said.
And, in a double whammy, they won’t be able to get their insurer to cover their medical gap fees.
“This situation will be compounded under current Bupa rules that prevent patients being treated in a non-contracted hospital from accessing the Bupa Medical Gap Scheme, so they are also facing higher out-of-pocket medical costs,” he said.
The medical gaps alone could see patients paying $900 in out-of-pocket expenses fees for hip and knee replacements, more than $330 for removing a breast lump and more than $140 for a colonoscopy.
There could be even larger additional costs for hospital bed and theatre fees, running into the thousands of dollars if Ramsay goes ahead with prices rises.
For example, a $10,000 operation could leave a patient $700 out of pocket as a 7 per cent rise in fees takes the procedure to $10,700.
A spokesperson for Bupa said: “We will be continuing to pay the medical gap scheme for doctors even if we do go out of contract with Ramsay, because we don’t want patients or doctors to be impacted by this”.
The fund will also continue to pay the current hospital rates to Ramsay patients even when the contract ends in August so any price rise will be the result of a Ramsay decision, the spokesperson said.
Spokesperson for Ramsay Health Care Dr Bernadette Eather said private hospitals were facing increasing costs, including strong increases in wages.
“Our costs of providing clinical services have risen dramatically with PPE, with testing, with screening of patients, the training required and increased cleaning. And at the moment, we’ve got a workforce that’s been significantly impacted by Covid,” she said.
“Bupa just haven’t been prepared to recognise that despite, as an industry, the health insurance companies have made record profits of $1.8 billion because we’ve not been doing surgery.”
BUPA said health funds had not made a profit out of Covid but had set aside $1.4 billion to cover the cost of surgery that had been delayed as a result of surgery bans imposed during lockdowns caused by the virus.
The fight takes place as Ramsay Health Care is under pressure to make its bottom line look good as it is subject to a $20 billion takeover bid by private equity giant KKR.
Dr Eather said the negotiations over price rises had been taking place well in advance of this takeover bid and the decision to terminate its contract with Bupa were not affected by it.
Bupa has warned price hikes by private hospitals would fuel premium rises for health fund members.
“Ramsay has sought unreasonably high rates of increase, which are more than double the rates that have been agreed with all other hospital groups in recent times,” Bupa said in a statement.
Private Healthcare Australia CEO Dr Rachel David said the Ramsay demands would set the scene for double digit premium increases under the incoming government and increase cost of living pressure on 14 million Australian with private health insurance.
“The important thing for our members to know is nothing changes in the next 90 days; if you’re booked in for an operation you will still be covered during that period. After that period, the choice to charge members an out-of-pocket cost will be a decision made by Ramsay as Bupa intends to continue paying its current rates, which are above the statutory default rates,” Bupa Health Insurance Managing Director Chris Carroll said.
Dr Eather said patients who wanted to use Ramsay hospitals could shift to another health fund.
The war between two major health corporations comes as public hospital waiting lists soar in the wake of Covid surgery lockdowns and more people are taking out health cover to get elective surgery on time.
RAMSAY HEALTH CARE HOSPITALS
Albury Wodonga Private Hospital
Armidale Private Hospital
Attadale Rehabilitation Hospital
Ballina Day Surgery
Baringa Private Hospital
Beleura Private Hospital
Berkeley Vale Private Hospital
Caboolture Private Hospital
Cairns Day Surgery
Cairns Private Hospital
Caloundra Private Hospital
Castlecrag Private Hospital
Coolenberg Day Surgery
Donvale Rehabilitation Hospital
Dudley Private Hospital
Figtree Private Hospital
Frances Perry House
Glenferrie Private Hospital
Glengarry Private Hospital
Greenslopes Private Hospital
Hillcrest Rockhampton Private Hospital
Hollywood Private Hospital
Hunters Hill Private Hospital
John Flynn Private Hospital
Joondalup Health Campus
Joondalup Private Hospital
Kareena Private Hospital
Kingsway Day Surgery
Lake Macquarie Private Hospital
Lawrence Hargrave Private Hospital
Linacre Private Hospital
Masada Private Hospital
Mitcham Private Hospital
Mt Wilga Private Hospital
Murray Valley Private Hospital
Nambour Selangor Private Hospital
Noosa Hospital
North Shore Private Hospital
North West Private Hospital
Nowra Private Hospital
Peel Health Campus
Peninsula Private Hospital
Pindara Day Procedure Centre
Pindara Private Hospital
Port Macquarie Private Hospital
Ramsay Clinic Adelaide
Ramsay Clinic Albert Road
Ramsay Clinic Cairns
Ramsay Clinic Cremorne
Ramsay Clinic Macarthur
Ramsay Clinic New Farm
Ramsay Clinic Northside
Ramsay Clinic Wentworthville
Ramsay Day Clinic Kahlyn
Shepparton Private Hospital
Short Street Day Surgery
Southern Highlands Private Hospital
Southport Private Hospital
St Andrew’s Ipswich Private Hospital
St George Private Hospital
Strathfield Private Hospital
Sunshine Coast University Private Hospital
Tamara Private Hospital
The Avenue Hospital
The Border Cancer Hospital
Victorian Day Procedure Centre
Wangaratta Private Hospital
Warners Bay Private Hospital
Warringal Private Hospital
Waverley Private Hospital
Westmead Private Hospital
Wollongong Private Hospital
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