Crackdown vow for ‘money-grabbing’ public hospital pressure ploy

But allegations of aggressive tactics being adopted by hospitals to pressure patients to use private health insurance to help fund their operations and in turn boost a struggling public system have moved both sides of politics to promise action should they succeed at the next election.


Labor’s planned Productivity Commission inquiry into the private health system will now look at this issue if elected in May and is preparing draft terms of reference for that inquiry.

Victorian Health Minister Jenny Mikakos has vowed to crack down on offenders.

This follows reports in The Sydney Morning Herald and The Age detailing treatment of patients being slammed as potentially fraudulent by legal and medical professionals.

“We don’t condone undue pressure put on patients to use their private cover, and if that’s occurring, we’ll be asking the Department of health and human services to crack down on those who flout the rules,” opposition health spokeswoman Catherine King said.

“We’d much rather our public hospitals were funded properly so the states didn’t have to seek revenge this way. That’s why we expect the Productivity Commission will examine the issue as part of our root-and-branch inquiry into the private health system.”

Hospital are pushing patients to be treated privately in a bid to boost their bare coffers. Credit:Alamy

Mark Fitzgibbon, chief executive of health insurer NIB, said the government has to come up with a system that removes the “perverse incentive to really push people to elect to be treated as private patients”.

The current funding model means that in NSW, Victoria and Queensland public hospitals receive more money for private patients than public patients. Patients and health professionals have detailed to this publication the behaviour this has triggered.

“Patients are regularly lied to and told incomplete information,” said a Sydney surgeon.

He described a system where public hospitals hire client liaison officers to identify patients with private health insurance when they are in emergency – at their most vulnerable – and pressure them to choose private treatment.

Newly appointed Victorian Health Minister Jenny Mikakos.

Newly appointed Victorian Health Minister Jenny Mikakos. Credit:Paul Jeffers

This publication has received a printout of an online training module for staff at a Sydney hospital that helps to “raise awareness” of the need to flip patients from public to private.

“Funding from private health insurance goes directly towards the wards and services that provide patient care,” the document says. “There are no disadvantages … unexpected costs should not occur.”

The surgeon said: “This is a deliberate lie repeatedly told to patients in a money-grabbing exercise.”

One Melbourne reader said he was lodging a complaint about his wife’s hospital treatment when he “discovered that they were using our private health insurance in a public hospital. They had not even asked our permission.”

Colin Kruger is a business reporter. He joined the Sydney Morning Herald in 1999 as its technology editor. Other roles have included the Herald’s deputy business editor and online business editor.

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