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Private health insurance and the public good

By Mark Cormack - posted Monday, 16 December 2002


To make the PHI work for the greater public good the Commonwealth needs to do three things.

1. Review and progressively improve PHI policy and products, so they can reduce pressure on the public hospital system. This involves action to eliminate all gap payments, better target PHI to reduce waiting times for elective hospital admissions, address major growth in emergency and outpatient activity, and put in place controls to constrain excessive utilisation of hospital services.

2. Use its annual $2.2bn expenditure on private health care, and its $7bn expenditure on public hospitals as leverage to drive a more planned and effective partnership between the public and private sectors that ensures better access, better quality care, improved efficiency and a focus on health outcomes from our total health care system.

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3. Comprehensively rule out any Treasury-driven “claw back” or other form of funding cut to the public hospitals based on the success of its PHI policies. There is simply no case to do otherwise.

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About the Author

Mark Cormack is National Director of the Australian Healthcare Association.

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