Private health insurers must not shirk transparency responsibilities
Australian Medical Association
Leading Australia’s Doctors. Promoting Australia’s Health.
AMA President
Health continues to be focus in the 2025 federal election race, with out-of-pocket costs for private healthcare now under the spotlight.?
Labor has committed to upgrading the Medical Costs Finder (MCF) website in a $7 million funding pledge aimed at improving transparency for consumers on out-of-pocket costs. While we support transparency and more information for consumers, our support for the Medical Costs Finder Website has always been contingent on ensuring it gives a complete picture – including shining a light on the contribution that Medicare and private health insurers make to the costs of their care.?
The AMA has a strong track record of supporting doctors and patients ?by providing the tools necessary to help ensure effective informed financial consent. This includes our detailed Informed Financial Consent Guide ?— a document that empowers patients to discuss costs with their doctor before undergoing medical procedures.?
We have also worked very closely with the Department of Health and Aged Care to help guide improvements to the MCF website, but technical challenges persist.?
We recognize Labor’s intention to increase transparency on costs in the delivery of private healthcare, but have made it clear any changes must include relevant information about all factors that contribute to costs for patients.?
A major challenge to medical practitioner uptake of the website has been the lack of information provided by health insurers. Despite a commitment from the former government to include this, insurers have largely avoided scrutiny with just three insurers so far electing to upload their data on the website.??
So we were pleased to see Labor’s commitment included placing a stronger obligation on private health insurers to reveal their data on how much they contribute to the cost of care and how often patients pay out-of-pocket costs for services that are not fully covered by their insurance policy.?
It is our hope that Labor’s planned upgrades will put an end to private health insurers obfuscating their rebates and data by burying the detail deep within their websites.??
We identified this lack of transparency as a problem a long time ago and acted by publishing the benefits paid by various private health insurance for a selected list of common services each year. You can find this detail in our annual private health insurance report card.?
Looking at the table in this year’s report card, the issue becomes strikingly clear: the difference in rebates for identical procedures varies wildly between insurers. For the uncomplicated delivery of a baby, for example, the difference between the highest and lowest rebates was $510 last financial year.?
The problem for consumers is, there is no easy way to find this kind of detail, which should be plainly available to all, because patients deserve to know which insurers provide the best value for their required procedure.?
Something the private health insurance sector consistently fails to acknowledge is that it’s this lack of transparency that contributes to the poor indexation of their rebates.?
As our latest report card showed, net profits for insurers increased by almost 50 per cent in the five years to June 2024, while the patient rebate for medical services increased by just 10 per cent in that time.?
I will leave it up to the private health insurers to explain why their profits were instead funneled into mysterious “management expenses” rather than patient benefits.?
Throw into the equation the years-long Medicare freeze — the miserly indexation that followed — and a drought of announcements or any significant investment for specialist rebates by successive governments, and you’ll see why out-of-pocket costs occur.?
Labor’s commitment to redevelop the Medical Costs Finder website will require extensive input from the medical profession, as well as legislative changes. It is essential to get the changes right and ensure data is accurate.?
We are already in discussions with Health Minister Mark Butler and the department about how to ensure any site upgrades have the desired effect of improving transparency on all the aspects that contribute to costs for patients.?
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