Hospital-in-the-home models of care should be covered by private health insurance, but insurers can’t be allowed to pull all the strings, says AMA.
The current regulatory system creates an “uneven playing field” by allowing private health insurers to develop their own out-of-hospital care model, without dictating that they cover other models, says the AMA.
And poor coordination between hospitals and general practice is wasting precious resources, adds the RACGP.
Today, the AMA released a position statement on the principles, or lack thereof, around cover of out-of-hospital care by private health insurers.
Out-of-hospital care offers a substitute to brick and mortar hospital care, generally through hospital in the home models or telemedicine.
According to the association, as it stands, the lack of rules limits patient access to new models of care and allows private health insurers to profit by designing their own models.
“Due to a lack of policy and legislation, private health insurers currently control virtually every aspect of private out-of-hospital care — including what services are available to patients and what they can charge — through vertical integration,” said AMA president Dr Danielle McMullen.
“These services are only available to certain patients depending on insurer and location, unlike in-hospital care where insurers are required to cover a certain portion of your treatment costs.
“Current insurer-led models of out-of-hospital care are not available to all privately insured patients.
“We are calling for legislation that prevents insurers from developing their own models that only serve their financial interests.”
Speaking to The Medical Republic, Dr McMullen said that while the public system had been making use of hospital-in-the-home models for some time, the private sector wasn’t making it happen.
“Really, the only groups who can afford to invest in these newer models of care are the insurers,” she said.
“That then creates a really uneven playing field, and concerns about vertical integration and managed care, if the only way you can get home rehab is if you’re with a particular insurer and you use their particular program.”
The association said patients should be able to access out-of-hospitals care where clinically relevant – like rehabilitation after joint replacement – whoever their insurer may be.
Dr McMullen warned of the threat of moving to a health system similar to that of the US.
“We appreciate private health insurers’ enthusiasm for out-of-hospital care, but without guardrails and a clear funding requirement in place, it could descend into a US-style system of managed care for these new services, which jeopardises the principles of patient choice and clinical autonomy,” she said.
While out-of-hospital care is a “crucial piece of the puzzle”, a position private health insurers appear to agree with, it should be governed by the same set of principles as in-hospital care, said Dr McMullen.
“All we are asking for is the same patient-focused principles we have for in-hospital private care — your choice of doctor, your choice of hospital, regardless of your insurer,” she said.
“We need to continue driving competition and promoting choice, the hallmark of the private health system.
“We envision a private health system where all patients with private health insurance cover, no matter where they live, can choose the best care option for them under the clinical guidance of their medical practitioner, funded by their insurer.”
This could be best achieved through an independent private health authority, tasked with a redesign and implementation of out-of-hospital care regulation, said the association.
When asked about private health insurer Bupa’s new telehealth clinic Blua, Dr McMullen said it was “just another example of insurers actively trying to seek ways of keeping people in their schemes, and it’s another example of why we need some systems oversight of the private sector”.
“At the moment, while the insurers do report to APRA for their regulatory environment, that’s really just about finances,” she said.
“There’s no one that has an oversight of how the private system all works together, what’s best for patients, how do we ensure that it’s designed in a way that is fair and equitable and actually meets patient outcomes.
“[Models like Blua] do risk fragmenting care and undermining bricks and mortar GPs on the ground and that importance of a stable GP relationship.
“So we’ve got concerns about that.”
Adding their voice to the conversation on care outside the hospital, the RACGP urged health ministers to up their game as they met on Friday for the Health Ministers Meeting.
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The college said the lack of coordination between hospitals and general practice was wasting precious resources.
“National and international evidence shows [that] better connection will get better health outcomes for Australians and reduce unnecessary hospital admissions and costs,” said RACGP president Dr Michael Wright.
“Lumos data shows visiting a specialist GP shortly after an unplanned hospital admission can reduce readmissions by up to 32%.
“This would be a clear win for state and territory health ministers who urgently need to reduce pressure on overloaded state hospitals.
“And it gives Australians who unexpectedly find themselves in hospital the best chance of reconnecting with their GP, recovering more quickly and getting on with their lives.”
Dr Wright said the lack of connectivity between hospitals and general practice left GPs out of the loop.
“GP specialists are also frustrated by complicated hospital referral processes which delay patient access to care and takes up valuable time which could otherwise be spent providing care to more patients – all this can and must be fixed,” he said.
The National Health Reform Agreement for 2026 onwards would be an opportunity to improve this integration, he added.
