Health funds say public hospitals duping patients

Research shows private health insurance being used when no-cost treatment available

Public hospitals are tricking people into using their private cover by saying it is a "donation” that will cost nothing - only for bills of up to $1000 to arrive months later. Picture: Dan Himbrechts

HEALTH funds says public hospitals are tricking people into using their private cover by saying it is a "donation” that will cost nothing - only for bills of up to $1000 to arrive months later.

They also allege emergency department patients who should be treated and sent home free of charge within the benchmark of four hours are instead being admitted then coerced into invoking their insurance.

Exclusive research has revealed state governments are pushing patients to use their insurance even though they have a right to no-cost treatment in the public system.

The practice is adding 11% a year to premiums and generating $1.5 billion a year for public hospitals from health funds, according to independent health analyst Martyn Goddard.

"For a family this would add $330 each year to their premiums,” Mr Goddard said.

And the amount state health regimes are reaping is growing by 12% a year, official figures show.

More is raised in NSW than Victoria and Queensland combined.

NSW has used the UK government-backed company Behavioural Insights Ltd - also known as the "Nudge Unit” - to increase private health insurance usage at hospitals including West- mead, Auburn and Fairfield.

The most aggressive growth has been in Queensland, where revenue is up 170% in just four years.

The take in Victoria is estimated to be approaching $250 million a year, and in South Australia almost $40 million annually.

HCF chief benefits officer Cindy Shay said: "Nearly every state public hospital now would have a private revenue team which encourages people to declare to use their private health insurance.

"There is a lot of pressure put on consumers. The sell is this will cost you nothing - you should consider it to be a donation to towards buying hospital equipment,” Ms Shay said.

News Corp Australia has identified examples of patients being offered inducements including toiletries, nappy-washing services, TV and carparking.

HCF members have reported being told by hospital staff that using their cover would cost them nothing only to later get bills for as much as $1000. Bupa has received similar reports.

Medibank's head of healthcare Andrew Wilson said: "Those with private health insurance should be aware that if they choose to use their private insurance in the public system, they could face out-of-pocket costs - costs that the public hospital may not charge them if they were a public patient using Medicare.”

Fund lobby group Private Healthcare Australia's chief executive officer Rachel David said people were being "hara- ssed” and "given misleading information” such as that they would be treated faster if they used their insurance.

HCF's Ms Shay said emergency department patients who should have been treated and sent home within four hours had instead been admitted then coerced into invoking their cover.