Going to bend the cost curve Moving from health insurance to health assurance The product must be more affordable, but They are also going to be more

Transcription

1 Going to bend the cost curve Moving from health insurance to health assurance The product must be more affordable, but They are also going to be more profitable

2 Communication campaign Influencing supply Minimal contracts with new facilities Caps on services Penalties for follow up services (e.g rehabilitation) GP initiatives (?) New services provisions

3 Changing funding models/tightening clauses NPBC recommendations Lower fixed payments for day procedures New quality provisions Various Type C rules (theatre or no theatre) Capping charges for Exclusion services Ambulance transport between facilities Ramping up audit Product reform (adding + subtracting items)

4 Looking at policy settings PHIAC folded into APRA Managing premium increase process Managing re-insurance Productivity Commission PHI review MBS review A happening thing Minister will welcome efficiencies AMA is participating

5 Demand driven product High levels of client satisfaction Many day surgery treatments deliver profound and immediate benefits (e.g IOL s, Skin cancer excisions) Under-resourced public sector Huge self insured potential Potential for other funding sources Public sector Medical tourism Compensable

6 Clear points of difference when compared with large overnight hospitals Pure pricing model No length of stay risk Affordability (good for client and good for fund) High levels of client satisfaction Self insured potential Higher uptake of Medical Gap Personalised, convenient, local

7 Health funds have to manage the member value proposition People primarily take out PHI to be covered against cost of hospitalisation (including in DF s) So funds need to: Keep the price down Provide superior customer service...do they? Support quality health care Provide adequate coverage... do they?

8 Health funds are sensitised to market share Scale is crucial to margins Highly profitable/small health fund not in scope Decision not to contract can have market share implications

9 % Hospital Related Charges Covered Fund Name Fund Name Fund Name Fund Name Fund Name NSW VIC QLD SA (Abbreviated) (Abbreviated) (Abbreviated) (Abbreviated) (Abbreviated) WA CDH 95.1% Westfund 97.6% Healthguard 95.4% Healthguard 98.5% HBF 95.0% Westfund 93.4% Healthguard 96.3% HCF 94.7% HCF 97.8% HCI 94.3% MDHF 93.1% HCF 96.0% HCI 93.6% HCI 96.7% Healthguard 93.8% HCF 93.0% QCH 96.0% CDH 93.4% CDH 96.4% HCF 93.0% Onemedifund 92.3% Transport 96.0% Onemedifund 93.2% Health- Partners 96.4% Westfund 92.7% QCH 92.1% CDH 95.7% CUA Health 92.7% Onemedifund 96.3% St. Lukes 92.1% Healthguard 91.9% Onemedifund 94.5% Health- 92.7% Westfund 95.9% Health- Partners Partners 91.6% Health-Partners 91.0% Medibank 93.9% Transport 92.7% Transport 95.8% Peoplecare 91.5% CUA Health 90.6% HCI 93.8% Westfund 90.8% BUPA 95.5% Onemedifund 91.3% HBF 90.0% MDHF 93.4% Medibank 90.4% HBF 95.3% QCH 91.1% Peoplecare 89.9% HBF 93.1% HBF 90.3% HIF 94.6% Medibank 91.1% Medibank 89.3% Latrobe 93.0% St. Lukes 90.2% Medibank 94.3% HIF 90.9% St. Lukes 88.9% St. Lukes 93.0% Latrobe 89.5% St. Lukes 94.2% CUA Health 89.5% Transport 87.9% BUPA 93.0% AU 89.2% Peoplecare 93.3% GMHBA 88.1% AU 87.8% Health- Partners 92.5% BUPA 89.1% QCH 92.7% AU 87.8% BUPA 87.6% GMHBA 92.4% Peoplecare 89.0% MDHF 92.5% BUPA 87.6% HIF 87.0% CUA Health 92.3% QCH 88.7% AU 91.9% MDHF 86.4% GU Corporate 85.8% AU 92.2% GU Corporate 88.3% CUA Health 91.1% GU Corporate 86.4% Latrobe 85.8% Peoplecare 91.6% HIF 86.7% GU Corporate 90.0% Latrobe 83.9% NIB 85.2% HIF 89.9% GMHBA 85.0% GMHBA 89.9% Health.com.au 82.3%

10 Fund Name (Abbreviated) Number of Agreement Hospitals/Day Facilities in QLD Ranking QCH Health-Partners 95 2 GMHBA 93 3 HIF 93 3 GU Corporate 92 4 Healthguard 92 4 Onemedifund 92 4 Peoplecare 92 4 Westfund 92 4 AU 91 5 CUA Health 91 5 HCI 86 6 Medibank 86 6 HCF 85 7 Health.com.au 85 7 NIB 84 8 Transport 83 9 BUPA Latrobe St Lukes MDHF CDH 64 13

11 Fund Name (Abbreviated) Number of Agreement Hospitals/Day Facilities in NSW Ranking GU Corporate Healthguard Onemedifund Peoplecare Westfund HIF AU GMHBA CUA Health HCF Health.com.au BUPA NIB Health-Partners QCH HCI Medibank Transport Latrobe MDHF St Lukes CDH

12 Fund Name (Abbreviated) Number of Agreement Hospitals/Day Facilities in VIC Ranking AU GU Corporate Healthguard HIF Onemedifund Peoplecare Westfund CUA Health GMHBA Health.com.au Health-Partners Latrobe QCH St Lukes BUPA MDHF HCI Transport Medibank NIB CDH

13 Fund Name (Abbreviated) Number of Agreement Hospitals/Day Facilities in SA Ranking HIF 54 1 AU 53 2 CUA Health 52 3 GMHBA 52 3 GU Corporate 52 3 Health.com.au 52 3 Healthguard 52 3 Health-Partners 52 3 Onemedifund 52 3 Peoplecare 52 3 Westfund 52 3 HCI 50 4 QCH 50 4 BUPA 49 5 Transport 49 5 Medibank 47 6 NIB 46 7 HCF 44 8 Latrobe 36 9 St Lukes MDHF CDH 28 12

14 Portability In the legislation Contractual status of fund and day surgery not relevant Funds do not like adverse selection More funds have moved from Restricted to Open HOWEVER Minister recommends shopping around PHIO recommends shopping around All health funds promote switching Private sector based on competition

15 Variable practice Variable pricing Narrow clinical bandwidth (exposed to few items) Less scope for cross-subsidisation Supply side drivers (perception or fact?) Rapid volume growth (???)

16 140 MBS Item Percentage variance 100 July 09 to July NSW VIC QLD SA WA TAS ACT NT Number of services per hospital covered persons

17 MBS Item NSW VIC QLD SA WA TAS ACT NT Percentage variance July 09 to July 14 Number of services per hospital covered persons

18 MBS Item NSW VIC QLD SA WA TAS ACT NT Percentag e variance July 09 to July 14 Number of services per hospital covered persons

19 MBS Item Percentage NSW VIC QLD SA WA TAS ACT NT -2 variance July 09 to July 14 Number of services per hospital covered persons

20 Variable practice? Consider intra-vitreal injections Consider Moh s procedures Bulk billing for self insured and no gap for health fund members (Nib has recently changed its Medical Gap schedule)

21 Portability must remain (member must be protected against health fund contracting decisions) Second Tier must remain (members must be protected and integrity of system must be monitored and preserved) PHI Product reform can deliver wins for DF s and health funds

22 Gagging must be addressed. This is a taxpayer subsidised industry. Members/public deserve more information about the use of their subsidy. Greater transparency needed around premium increases (e.g unit cost) ADHA health fund report cards? Premium increases, Consumer information PHIO data, APRA data, Media, Health fund profitability, Network coverage

23 Profit is not a dirty word But can make it harder to negotiate For profit funds must match the value offered by not-for-profit funds For profit day surgeries must match the value of not-for-profit day and overnight facilities Do you need to negotiate as an alliance? (29 health funds seem to like it)

24 Medibank Private under fire for secretly slashing coverage of hospital tests Members left with Gaining unexpected traction bills with after health Medibank funds Private changes provider agreements Medibank Private Partnershipseeks answers for cost blowouts Professionalism Integrity Branding Casemix classifications Industry developments Political and regulatory climate Clinical leadership Research/Industry awards Profile Private health insurance companies' $2 billion headache Medibank and listed rival nib said in February, when announcing their half-year results, that customers switching to cheaper policies were dragging on their financial performance.

25 Gaining traction with health funds Professionalism Integrity Partnership Branding Casemix classifications Industry developments Political and regulatory climate Clinical leadership Research/Industry awards