On September 11 the Private Health Insurance Legislation Amendment Bill 2018 (the Bill) and two related Bills passed the Parliament.
The legislation implements a package of reforms around private health insurance, they include:
- allowing for age-based premium discounts for hospital cover
- allowing private health insurers to cover travel and accommodation costs for regional Australians as part of a hospital treatment
- strengthening the powers of the Private Health Insurance Ombudsman
- improving information provision for consumers
- reforming the administration of second tier default benefits arrangements for hospitals
- allowing insurers to terminate products and transfer affected policy-holders to new products
- increasing maximum voluntary excess levels for products providing individuals an exemption from the Medicare levy surcharge and
- removing the use of benefit limitation periods in private health insurance policies.
The Minister for Health, Greg Hunt MP, announced these reforms will make private health insurance simpler and more affordable.
“This new approach will take all existing private health insurance policies and categorise them into a four-tier system – Gold, Silver, Bronze and Basic,” Mr Hunt said.\
Following the passage of the legislation, pain groups have cautioned about potential unintended consequences of placing chronic pain in the highest category of cover.
Changes to the clinical category intended as part of the reforms could disproportionally impact patients with chronic pain and may have far reaching implications for millions of privately insured consumers who rely on existing coverage to access chronic pain management.
Advocacy group Painaustralia has urged the Commonwealth to reflect concerns its members have raised in the rules currently being drafted to give effect to the reforms in the legislation.
Painaustralia’s CEO, Carol Bennett said she welcomed the broad intention of the reforms to simplify private health insurance but cautioned against reforms that could create a situation that forced vulnerable people to drop their health insurance altogether.
“It’s important that [the legislated reforms] don’t negatively impact on people living with chronic pain who are some of the most vulnerable in our community and often unable to work,” Ms Bennett said.
These concerns were also noted by Senator Helen Polley and Senator Richard Di Natale during the second reading of the Bill, with both nothing the changes to clinical categories could adversely impact millions of consumers.
“These rules are not detailed in these bills. Those details are apparently going to come later in the form of regulation. The government claims its new gold, silver and bronze basic system will make private health insurance simpler and more affordable. It also claims that the changes will give consumers more clarity and certainty around their coverage,” Senator Polley said.
Chronic pain is the most common reason that people seek medical heal and one in five Australians live with chronic pain. Pain is also common to many chronic conditions and its impact spans the health, disability and ageing systems.