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In whose best interests?

Recent media reports have highlighted the somewhat complex and hidden costs associated with health care.  The Four Corners report “Mind the Gap” focused on out-of-pocket expenses and hidden fees from surgeons.  Whilst the ABC medical report on “Secret Pacemaker Payments Boosting Private Hospital Coffers” focused on the hidden rebates hospitals receive for using various medical devices.

The two issues are separate, but very much related.  Both point to the lack of transparency of financial interactions between specialists, hospitals and a variety of other stakeholders in the health care market.

The first media report highlighted the issue around “informed financial consent”.  It is mandatory for all patients receiving care from a specialist in a private hospital to sign a document stating that they agree to the charges related to the procedure or care for which they are being admitted.  But how “informed” is the financial consent?  At a vulnerable time, how likely is a patient to shop around to get a better quote.  How does a patient tell if cheaper care will result in the same, better or worse outcome?  Does the specialist or hospital have any responsibility to inform patients that there are other (possibly cheaper) options available?

The second report highlighted the hidden, often lucrative, negotiations hospitals make with medical device companies, which potentially affect the choices offered to patients.  The medical devices industry is a less regulated market than pharmaceuticals, in this respect, and although there is no proof of patients’ outcomes being adversely affected, it has certainly opened a Pandora’s box of questions regarding whether or not the most appropriate device is being used and whether the most appropriate device is available equitably to all patients across the public and private health care sectors.  There is also the suggestion that such arrangements may breach the Trade Practices Act.

There are also other hidden financial arrangements, which are yet to surface in the national media, but are sure to be exposed in coming months.  Some of these include benefits, payments or incentives made by Private Hospitals to specialists and specialists having a financial interest in the hospital or health-care facility (including same day-units) that they admit their patients too.

The Health Insurance Act 1973 Section 129AA specifically prohibits a health practitioner from asking, receiving or obtaining, any property, benefit or advantage of any kind for themselves or others from a private hospital.  It also prevents a private hospital from inducing a health practitioner to influence admission to hospital.  This intent of this rule is to ensure that there are no enticements which “encourage” admission to hospital, increasing the amount of money health insurers pay in benefits to specialists or hospitals.

It is unknown how wide-spread the practise of private hospitals providing incentives to specialists is; however, tickets to shows, sporting games, dinners, hotel accommodation, reduced fees for clinic room leases, secretarial services and parking privileges are some of the things whispered about.  It is rumoured, that some of these are “volume” based.  That is, the more patients a specialist admits to hospital, the more he or she may benefit.  Conversely, should the admission rate drop, benefits may be reduced.

Similarly, it is not known what affect a specialist’s financial interests (such as part-ownership or shares) in a hospital or health-care facility (including same day-units) may have on their decisions about whether or not admission is needed, or in fact whether another health service provider may be a better alternative to hospital for the patient.  Such an issue may affect whether or not a specialist will consider sending a patient to, say a home service provider for treatment at home, rather than admitting to a hospital or same day-unit that they have a financial interest in.

It is not illegal, immoral or unethical for a specialist to have a financial interest in a hospital or health-care facility.  But, should this be something they need to declare up front to patients?  Should they be required to declare their potential conflict of interest? Do patients need to be aware that they directly earn money from their admission to a particular hospital or health care facility and that this might impact the choice of care they are offered, or where that care is delivered?

As the tangled web of the money trail in health unravels, it will be interesting to see where this will all lead.  More transparency? Real choice?  Better outcomes? Lower costs?  Hopefully patients will be the winners, as after all, they are the only reason we all exist.



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