Private Healthcare Australia calls for major reform in 2023-24 Budget

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Australia's private health insurers have used their 2023-24 pre-Budget submission to call for further changes to medical device pricing, new action to combat claims fraud, the abolition of second-tier default benefits, more protection for consumers and changes to encourage more people into cover.

Private Healthcare Australia has issued its submission that is significantly focused on seeking reforms of the framework for the private reimbursement of medical devices (Prostheses List).

The Prostheses List has been the subject of a hotly contested debate between stakeholder groups.

Private insurers have called for extensive reform to correct the comparatively high prices paid for implantable medical devices.

The device companies, represented by the Medical Technology Association of Australia, have acknowledged the need for further reform after a series of tranches of price reductions.

However, they oppose the sort of reform advocated by private health insurers and oppose legislation currently before the parliament that would grant the federal government and its officials significant power to impose change.

Currently, an implantable device is added to the Prostheses List at a particular price, with minimal controls over its use in the form of detailed PBS-style restrictions. 

In its submission, Private Healthcare Australia has called for the adoption of "conditions on listing" similar to those used by the PBS, "where rebates are available only when the medical device is used for the intended purpose (or when a medical practitioner deems it reasonable and necessary)."

"This initiative would save consumers around $20-50 million per annum," it says.

The changes to the Prostheses List currently under consideration by the parliament would grant the government and officials significant power to impose these types of requirements.

Private Healthcare Australia has called for other actions to combat high prices for medical devices, including an investigation by the competition regulator (ACCC).

It has also used the submission to restate many of its existing positions, including an increase in the Private Health Insurance Rebate for people on very low incomes and legislation so that consumers can not be held liable for costs not disclosed before surgery.

It also says private health insurers should be able to support specified primary care programs approved and monitored by general practitioners.