Patients big winners in Minister’s call on surgeries

CHA welcomed the early May announcement from the Minister for Health and Aged Care Mark Butler that insurers would continue to be required to pay for General Use surgical items. The government noted CHA’s strong advocacy around this issue and CHA’s support in reaching this important decision.

General Use items will remain on the Prescribed List (PL) past 1 July 2024, when they had been scheduled to be removed. Items on the PL are mandatory for insurers to fund if used for surgery on an insured patient.

The current list value of these items – which are critical in the provision of a range of surgeries – is estimated at $250m per annum for private hospitals and their patients. If these items had been withdrawn from the PL on 1 July 2024 as intended, this funding would have been at risk as insurers sought to withdraw or reduce funding.

Since the removal of GUIs was first announced in 2021, CHA has invested substantial advocacy resources into having the decision reversed. Initially due to be removed from the list on 1 February 2022, CHA first sought and received a delay until 1 July 2023. A further delay was then obtained to 1 July 2024 – the deadline that has now been indefinitely averted.

In that time, CHA built and led a coalition to advocate to both the Morrison and Albanese Governments to reverse course.

Importantly, CHA also developed a proposal for public sector reference pricing and built a coalition around its implementation. This advocacy contributed to the device industry signing a memorandum of understanding with the federal government that reduced overall prices across the whole PL. Importantly, it also permanently reduced prices of General Use items.

CHA analysis estimates that the average cost of GUIs per patient has come down 11 per cent as a result of CHA’s proposal, saving millions of dollars for Australian hospital patients. That represents a direct saving for the Australian private health insurers too, that CHA hopes to see passed onto consumers.

Rural and regional patients will also benefit from the continued availability of surgeries that would have been at risk if these items had been removed from the PL come 1 July. That saving applies not just to CHA Member’s patients, but to all private hospital patients whose surgeries use GUIs – a significant public good.

CHA is grateful for Minister Butler’s considered response to our advocacy and this important decision for private hospital patients.