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AMA sounds alarm on move toward US-style managed care

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AMA President Associate Professor Brian Owler has raised the alarm about a strong push by private health insurers into primary health which he warned could pave the way for US-style managed care.

A/Professor Owler used a major speech at the National Press Club to draw attention to recent manoeuvres by private health funds which he said compromised fundamental principles about universal access to health care and could result in insurers interfering in the doctor-patient relationship and dictating treatment.

“Despite the protests of innocence, I fear a concerted effort on behalf of private health insurers to undermine and control the medical profession,” the AMA President said. “We have concerns, and both private health insurers and the Government understands that a US-style managed care system is something that the public does not want.”

In his speech, A/Professor Owler drew attention to a number of recent developments which he said were cause for alarm, including Medibank Private’s trial with general practice provider IPN to give its members priority GP appointments in return for paying administrative fees, the interest of insurers in tendering to operate the new Primary Health Networks being set up to replace Medicare Locals, possible involvement with regional GP training providers and pre-assessment programs for cosmetic procedures.

The health funds have undertaken these initiatives with the tacit support of the Federal Government, which has encouraged their interest in expanding their scope of operations, including into primary care.

In a speech in March, Health Minister Peter Dutton noted with approval the Medibank-IPN trial as an example of the sort of “collaboration” with doctors and patients the Government would welcome.

“I am encouraged to see that health insurers are looking at innovative options in the area of primary health care,” Mr Dutton said. “They have been excluded from the primary care space for historical reasons, and if insurers are prepared to work collaboratively with doctors and patients then we should welcome that development.”

In an attempt to head off concerns that such developments could undercut Medicare and the principle of universality of health care, the Minister said the Government had no interest in undermining Medicare, nor in supporting changes that would allow insurers to provide gap insurance or bump up premiums.

But A/Professor Owler said he was not reassured.

“I know the Government is engaged very closely with the private health insurers and have asked them for information about how they might contribute,” he said. “The stage is being set for a US-style managed care system in both the primary care and hospital settings, [and] I am concerned that the Government is also looking towards such a system.”

“The Government has said ‘no, we’re not going to go down the track of managed care’, but managed care has many guises, and we need to keep a very close brief on where we are actually heading with private health insurers and their engagement with primary health care.”

Health funds have already been accused of interfering in clinical decision making after claims the Medibank Private was refusing to cover plastic surgery for patients with burns, cancer and other conditions.

The Australian Society of Plastic Surgeons has, according to News Corporation newspapers, raised objections after Medibank refused to cover the cost of surgery to remove both breast implants from women after one of them had burst. Other concerns include a refusal to cover reconstructive surgery for burns victims and patients who have had cancers removed.

A/Professor Owler said the AMA did not totally discount a role for private health funds in primary care, but it should be “at the edges”, such as supporting the management of patients with chronic health problems.

He said it needed to be kept in mind that insurers were motivated by profit and the competition for market share.

“While we understand that there are some areas in primary care where private health insurers may have a role, I think we need to be very careful about how that is done,” he added.