More about Private Health Insurance changes

The Commonwealth Department of Health and Ageing has published further information about the Federal Government's proposed private health insurance reforms. These developments were first noted in the Blog post of 27 April.

"The changes that have been agreed include:

• the introduction of legislation to allow, but not require health funds, to offer Broader Health Cover products;
• the proposed mainstreaming of the Outreach Hospital in the Home services will be suspended pending the introduction of Broader Health Cover;
• the regulation of products, rather than health funds, which will involve the private health insurance rebates attaching to products rather than a health fund registration;
• the introduction of uniform safety and quality criteria so that in the future all privately insured services will be provided by an accredited facility and/or suitable qualified provider;
• the removal of Lifetime Health Cover (LHC) loadings for members who have held private health insurance on which they have paid a loading for 10 years continuously;
• Medicare Australia, as part of business as usual, will write to people who do not have private health insurance and are about to be affected by LHC, reminding them of their LHC deadline and that they may incur a LHC loading;
• a requirement being placed on health funds to provide, for each product they sell, standard product information about:
  - premiums;
  - waiting periods;
  - exclusions;
  - hospital and medical gaps; and
  - excesses.
• support for the establishment by the Private Health Insurance Ombudsman of a website that will allow people to compare health funds and their products and provider arrangements. The standard product information will be required to be provided to the Ombudsman for publication on the website; and
• the implementation of risk equalisation (reinsurance) reforms that will include:
  - the implementation of a modified industry model for risk equalisation;
  - a high cost claims pool; and
  - the treatment of single parents as 1 Single Equivalent Unit."

Certain of these changes are expected to have direct impact on the way some dental services are funded. Historically dental services were only covered under ancillary benefits tables, but from 1 April 2007 "health funds will be able to offer products that pay benefits for services that are part of, prevent, or substitute for hospital services, removing the current boundary that exists between “hospital” and “ancillary” insurance".