A joint statement from the AMA, Australian Private Hospitals Association (APHA), Consumer Health Forum (CHF) and Medical Technology Association of Australia (MTAA) says any reform of the Prostheses List must focus on the needs of patients, "including the preservation of access to the most clinically appropriate care."
In the statement, the four groups say they recognise the critical need for further reform of private health insurance to ensure its ongoing sustainability, including improvements to the Prostheses List (PL).
The federal government's PL consists of medical devices private health insurers are required to fund if a policyholder has the relevant coverage.
It has been under sustained scrutiny in recent years with reforms announced in 2017 delivering price reductions.
Late last year, the Department of Health launched a stakeholder consultation process on options for additional reform, including the adoption of health technology assessment, cost-recovery and new funding arrangements for low-cost high-usage items.
Private health insurers have also proposed a range of specific reforms. These include the removal from the PL of 67 'non-prostheses' groups comprised of items such as adhesives and sponges.
They have also proposed the phased adoption of an episodic diagnosis-related group (DRG) based prosthesis funding model. This would involve the independent setting of reimbursement amounts based on the 'bundled' prosthesis component of a procedure.
The Medical Technology Association of Australia has argued these reforms will restrict access to new technologies.
In the new statement, the four groups call for an evidence-based mechanism to underpin the listing and pricing of medical devices, including provision for regular review to achieve savings. They also call for a clear definition of included products on the list, its simplification and more transparency, processes to review and promote evidence-based utilisation, more efficient access pathways and enhanced capabilities in the Department of Health to manage the PL.
"The Department’s proposal to abolish the PL and replace it with the private health insurance lobby’s preference of an AR-DRGs (Australia Revised – Diagnostic Reference Groups) based schedule of benefits, presents serious concern," said the groups in their statement.
"This will mean hospitals are only funded to cover the cost of medical technology(s) used in an average case; i.e. the costs of devices in an average eye procedure, the cost of a knee joint and associated components in an average knee replacement."
"This ignores the fact each patient and their health care needs are different – despite a similar diagnosis. The cost of the medical technologies required can vary significantly from patient to patient; even when they are undergoing the same procedure. This will leave patients and hospitals to pick up the cost for the difference, or simply miss out on accessing the necessary medical device/s."
Private Healthcare Australia recently said that, under the proposed reforms, doctors and patients will have access to a full range of medical devices with no co-payments and that where a more expensive device than the average is required, doctors will be able to access more funding through a declaration form.
The four groups said any reforms should prioritise "quality of outcomes for patients" and preserving clinical choice while ensuring the sustainability of the private health system.
"This can only happen by undertaking practical reform of the PL. The Department’s preferred approach of abolishing the PL and replacing it with a system unproven anywhere in the world will have detrimental impacts across both the public and private health systems," they add.