Out of Pocket Expenses

Australia has one of the best healthcare systems in the world and between Medicare and private health insurance, we should be able to receive treatment virtually for free.

Unfortunately, that’s not the case. In fact, for some procedures, people are being charged out-of-pocket expenses ranging into the thousands or even tens of thousands of dollars over-and-above Medicare and health insurance rebates.

“It’s simple – patients are being ripped off,” says Danny Vadasz, CEO of Health Issues Centre.

“In some cases, the price gouging is being disguised as ‘administrative’ or ‘booking’ fees that aren’t being appropriately disclosed to Medicare and health insurers under the no or known gap insurance arrangements.

“In other cases, doctors are simply charging outrageous fees – sometimes hundreds of percent more than their peers for exactly the same service.”

Adding insult to injury, this egregious overcharging is often done without the full prior informed consent of the patient.

This can leave people horribly in the lurch financially. In some cases, the financial hardship can be so extreme that people have reported taking out a loan or gaining early access to their superannuation to pay for it.

In April 2018 the Consumers Health Forum surveyed 1200 people about out-of-pocket expenses and unearthed some appalling trends, including:

More than a quarter of people treated for breast cancer had to pay more than $10,000 in out-of-pocket costs
One third said nobody explained there might be out-of-pocket costs before treatment.

This tallies with similar individual complaints received by the Health Minister, including:

An up-front gap of $5,000 charged ahead of hip replacement surgery
$1,000 for monthly chemotherapy appointments
$5,000 for breast cancer surgery plus an additional $3000 for pathology
Over $4,000 charged to a pensioner over 80 years old for a hip replacement.

We think this is wrong. Patients have a right to know what they will be charged up-front. And if individual practitioners are charging far above their peers, people have a right to know in advance so they can make an informed decision about whether they can afford those feed before they make an appointment.

In 2017, the Minister for Health, the Hon Greg Hunt MP, formed an expert committee to advise him on how to rein in aggressive overcharging. One of the committee’s recommendations was to establish a comparison website to provide transparency about clinicians’ rates and help people to shop around.

Not surprisingly, the medical colleges and associations are not keen on this – despite initially showing support – and are dragging their feet on implementation.