Health funds say soaring fees for obstetricians is to blame for women shunning private births

Private insurers are blaming obstetricians’ high fees for the nation’s maternity crisis amid predictions private birthing will be ‘extinct by 2030’.

Cairns mum Keely, 31, had to fly 1700 km to the Gold Coast to give birth to her son Archie after the only private maternity service in Cairns closed.

Private insurers are blaming ­obstetricians’ high fees for the ­nation’s maternity crisis, demanding they reduce their specialist charges to patients so women will be able to use health insurance to give birth in the private system.

Private Healthcare Australia responded to reports that birthing in the nation’s private maternity system may be “extinct by 2030” by hitting back at doctors’ fees, with obstetricians charging some of the highest out-of-pocket fees of all doctors in Australia.

Insurers have called this “the major barrier to people choosing private maternity services”.

The comments follow an assessment by the nation’s leading obstetricians that private maternity services were in “precipitous decline”, with falling numbers of births, ward shutdowns, and a marginally viable private hospital system.

Women are reporting that they have taken out gold cover at great expense in the expectation of having a baby in the private system, and then have been unable in some areas to book into a private hospital to have their baby due to ward closures.

Thirty years ago, almost 40 per cent of all births occurred in ­private hospitals. In the past decade, the number of babies born in private hospitals fell to 22 per cent.

This year, excluding women who use their private health insurance to birth in public hospitals, the doctors estimated it was likely that in 2024 fewer than 20 per cent of births would occur in private ­mat­ernity hospitals, and were expected over the next decade to continue to “fall precipitously”, to the point where by 2030, private maternity hospitals “will cease to exist”.

There have been at least six ­maternity ward closures nationwide in the past couple of years, among scores of entire private hospitals that have shut down. The reasons given range from ­staffing difficulties to viability problems and reduced numbers of births. It comes as health fund and hospital group CEOs met with key medical leaders and the federal government on Monday as part of a rapid review of private hospitals’ viability.

But PHA chief executive ­Rachel David said specialists were largely to blame for the fact that many women could not use their insurance because the out-of-pocket costs were so high.

“The easiest thing in the world is to blame the woes of private obstetrics on health insurance funds, but this will do nothing to address the root causes of why many mums are reluctant to have their babies in private,” Dr David said.

“Every participant in the private health system needs to take responsibility for this, as the funds do not have all the levers to fix the problems.

“Research shows the No.1 reason people don’t choose a private hospital to give birth is the out-of-pocket fees charged by obstetricians, which can be up to $10,000 in major cities. Under Australian law, this is a fee that health insurance is not allowed to cover.

“When you add the cost of scans and pathology costs, and any out-of-pocket fees charged by an anaesthetist who doesn’t bulk bill, for example, you can see why people are opting for other models of maternity care, including free care in a public hospital during a cost-of-living crisis. If obstetricians want private maternity care to remain viable, they need to be accountable by reviewing their fees,” she said.

Dr David also blamed “the rigid product tiering system inflicted on private health insurance by the previous (Coalition) government”, which she said had inflated the cost of Gold hospital cover. The product tiering system was introduced over five years ago, and insurers complained at the time that it would be inflationary for top hospital cover.

“Health funds know the affordability of top tier private health ­insurance is part of this story. But it’s impossible for health funds to pay hospitals more and reduce premiums at the same time,” Dr David said.