My health insurance may well be free* but it is still utterly terrible value.
That free health insurance is something I have in common with the Grattan Institute's director of health programs Stephen Duckett, whose report on private health insurance was released this week. As Duckett puts it, "If I don't take out health insurance I pay more in tax than the cost of my premium. I have a 100 per cent subsidy for my health insurance when a person on half my income has a much lower rate of subsidy."
He's smart and does it for financial reasons. It's my lucky charm, paid for only because I'm superstitious. For example, "what if I get hit by a bus". Health insurance only survives because we all have the secret "what if" anxiety.
Health care in Australia is, for consumers, a dual system which serves the interests of the private health funds; and, I fear, the desire of some doctors to be paid well. Doctors make up five of the top six taxable income earners, according to the Australian Taxation Office.
Subsidies to private health funds, and therefore to private medical care, are subsidised to the tune of more than $9 billion a year and we have no evidence that's value for money. We know it's not really working on the demand side - it's not just the public system which has queues of two years. Try getting into a top ear, nose and throat specialist short of three months; and take your credit card with you.
Speaking of money, here's what happens in real life. My hysterectomy, not elective but urgent and essential, left me $3000 out of pocket. That was just for the surgery with an experienced gynaecologist. Our family was still at the stage where our kids were at school and costs were insane. At the same time, the interest rate on our mortgage was about triple what it is now. We were DIAMONDS. Double Income. Awesome Mortgage. Offspring. No Dough.
The $3000 gap was terrifying but I had no choice. I made an arrangement with the surgeon to pay it off over a year. On top of that, at the hospital, the anaesthetist came to see me for a one-off and asked me a few questions. He took five minutes and handed me an "Estimate of Anaesthetic Fees". $750. The estimated gap was around $500. I was in a haze of pre-surgery anxiety so didn't have the capacity to have a sensible discussion.
Health insurance only survives because we all have the secret "what if" anxiety.
A few years later, wanting to see how my remaining bits were going, I rang the gynaecologist again. The receptionist asked me if I was in better financial shape.
Of course, some of my costs were met by private health insurance, some were met by Medicare. The hospital itself was covered entirely by my fund but there were no private rooms available. A public hospital would have been a little different in terms of my accommodation. But there were gaps, big gaps. And it's the gaps, some financial and some about access, that are the problem.
As the Grattan Institute's Duckett has said often this week, the private health industry is in chaos. Good. We should shut it down. The nine billion dollars of government money propping up these failures is my good money - and yours - being thrown after bad money, wasted money. Direct all that money to Medicare since that's where everyone's headed anyhow. Plummeting private health insurance membership. Soaring premiums. Instead, have one system. No gaps. People can wait in turn for what's fair. Bunions can wait. Some bunions.
My experiences, trivial in comparison to those who've paid the gaps for brain tumours, heart surgery and other life-saving procedures, are only some of the experiences of millions of Australians as we deal with a medical system which has zero transparency. For a long time now, while we wait for the private health system to implode, I've had this fantasy a consumer association - anyone - will be able to give us the complete guide to doctors and we will be able to comparison shop. This week, again, doctors said they would refuse to take part in Health Minister Greg Hunt's proposed medical fee transparency website because it was a "meaningless" political exercise.
This is a distorted market. Those who make the market have all the power and those forced to shop in the market have none. This year alone, my family members have had gaps of up to $1000 for services, including for services provided by ophthalmologists and dermatologists. It's not about over-servicing the worried well. It's about dealing with skin cancers and cataracts. On top of those gaps, our private health insurance costs $229 a fortnight.
The Grattan Institute is continuing its own inquiries and will come up with some decent answers. In the meantime our own health system isn't based on any evidence of any kind, except it doesn't work. For anyone. Duckett is asking for a government inquiry into our health system. He's looking for evidence. I doubt this government wants that.
- Jenna Price is a regular columnist and an academic at the University of Technology Sydney.