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Care-in-the-home plan sparks warning of US-style health model

“Far too many people are going into hospital every year for care that could be delivered in the comfort of their own home,” said Catholic Health Australia’s director of health policy, James Kemp.

Private Healthcare Australia chief executive Rachel David said health funds supported the hospital-in-the-home project in principle and that “a whole lot of people with medical conditions no longer think going to hospital is safe” during the COVID-19 pandemic.

But she added: “Not every program is going to meet the patient’s needs.”

Australian Private Hospitals Association chief executive Michael Roff said health funds were pushing a US-style “vertically integrated” model of care where funds dictated what services members could access under their insurance, and who delivered them.

“They want to make sure they’re controlling the service,” Mr Roff said, warning this would result in lower-quality healthcare due to cost cutting.

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As health insurers prepare to hit members with their delayed annual premium rises on October 1 – an average of 2.92 per cent – and grapple with rising costs amid an exodus of younger members, Mr Hunt is looking for ways to make health insurance more appealing and affordable.

Mr Roff said the best way for the government to protect private patients’ right to choice would be to force health insurers to pay a “minimum default rate” towards hospital-in-the-home treatment whenever it was delivered by a private hospital – the approach recommended by Catholic Health Australia in its report.

Mr Kemp said the default rate was essential to ensure “out-of-hospital care does not turn into the poor cousin of in-hospital care”.

Dr David said forcing insurers to pay for hospital-in-the-home services would be “disastrous” and if Mr Hunt wanted to keep premium rises below 3 per cent, it was not feasible to deny health funds the ability to decide which programs to cover.

The rule, which already applies to all services delivered in private hospitals, means health funds have to pay for a member’s treatment, even if they do not have an agreement with the hospital, at 85 per cent of the average they would pay if the episode of care was delivered in a hospital with which they did have an agreement.

A spokesman for Mr Hunt, who has linked his hospital-in-the-home shake-up with efforts to reduce health insurers’ costs, said Catholic Health Australia’s report made “a timely and valuable contribution to this debate” and would be taken into account.

Mr Roff said private hospitals were subject to “rigorous national safety and quality standards” that did not apply when services were delivered by non-hospital medical providers or health funds themselves.

“The government has to ensure that whatever service a patient is accessing is the right choice for that patient, in consultation with their treating doctor,” he said.

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