Health insurance row accelerates rush to offshore treatment

A dramatic bust-up between hospitals and health insurers over soaring costs is set to accelerate a rush for risky overseas medical treatment.

Dental work is the most common offshore surgery choice for Australians.

A dramatic bust-up between hospitals and health insurers over soaring costs is set to accelerate a rush for risky overseas medical treatment.

Australian health insurers are warning of big increases in insurance costs after an unprecedented string of developments in recent months where private hospitals have ripped up contracts with insurers. More than six million Australians are already exposed to the bust-up between Healthscope (owner of 38 private hospitals), BUPA and the Australian Health Services Alliance (an association of 26 smaller ­insurers).

As the stakes rise locally, a new report says most Australians – 56 per cent – would consider switching to overseas facilities for health treatment.

Australians have already been travelling overseas for dental and cosmetic work, with an estimated 15,000 now doing so annually while medical tourism is growing at 20 per cent a year. More recently, treatment abroad has included ‘‘life saving or life extending cancer treatments that are not available in Australia”.

Though medical risks offshore are well known, the financial risks are less obvious. The biggest is that complications arising from offshore surgeries may not be covered by conventional health insurance.

The medical travel report from insurance provider Insure & Go, based on a sample of more than 1000 consumers, suggests rising costs and an 18 per cent increase in waiting time for elective surgery underpin the trend for offshore treatment.

“The majority of Australians willing to go overseas for medical procedures would do so knowing that complications arising from their treatment would not be covered by travel insurance,” the report suggests.

According to David Mayo of Insure & Go: “In most cases, travel insurance covers unknown incidents – not the risks you know about, such as planned medical procedures,” he said. “If something goes wrong during or after your procedure, it could end up costing you much more than you would have paid to have the treatment at home.”

The issue is most acute in NSW where the Minns government has just intervened in the market. The government said it would charge 53 health insurers double for public hospital beds to force them into a fairer system: Insurers in turn responded by pushing harder for a 6 per cent increase in health premiums for all 15 million insured Australians when new price settings come into effect next year.

NSW is the trouble spot for private health insurance, with the worst statistics. Patients in NSW are more likely than those in any other state to travel overseas for surgery. The report says NSW has the longest median wait time for planned surgeries in Australia, with patients now waiting more than double the time they did two decades ago.

Medical authorities have already spelled out the medical risks of going offshore to access cheaper treatment. The government’s smart traveller service includes warnings from the Australian Medical Association suggesting medical tourism may expose users to infection and even ‘‘disfigurement’’ risks.

The AMA’s warnings include:

● quality surgical skills and practices that can lead to infection or disfigurement.

● Antibiotic-resistant bacteria can cause complications after surgery and may not be treatable.

● A lack of discussion before the operation about whether the procedure is necessary.

● A lack of follow-up after the operation to ensure the results are satisfactory and safe.

As The Australian reported last month: ‘‘In short, the affair has become a standoff. Private hospitals say health insurers have not been paying enough for years and the hospitals cannot continue to run as they are. Health insurers say the amount they get to charge customers a year is not enough and the government must let them charge more. In fact, health insurers want to double their annual increase next time.’’