Ongoing debate over medical device pricing and savings

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Members Health says new data highlights the need for further reform in the funding of medical devices while the MTAA says it does not include the bulk of reductions negotiated in 2017.

Members Health is the representative group of 27 not-for-profit, member-owned, regional and community-based private health insurers.

The organisation said data from 2017-18, collated by the Independent Hospital Pricing Authority and federal Department of Health, show device manufacturers charged patients with private health cover up to three times more than patients in public hospitals.

It said, "If the same average price for medical devices were applied in private hospitals as public, consumers would have saved a staggering $935 million. This equated to a $141 annual saving for every Australian private health insurance policyholder."

According to Members Health, in 2017-18, the average cost of a pacemaker in the public system was $12,767 compared to $48,245 in the private system.

"A hip replacement in a public setting cost on average $6,174, but more than $9,800 in private," it said.

However, the MTAA said the Members Health data does not include two of the three rounds of price reductions it negotiated in 2017. It also said the use of 'averages' means the comparison is based on 'device' buckets rather than individual prostheses.

The MTAA signed an agreement with the federal government in 2017. Under the agreement, the medical device sector agreed to price reductions that would reduce outlays by $1.1 billion over several years.