Australia’s largest private hospital operator terminates contract with health insurance giant

MedTech News: Australia’s largest private hospital operator, Ramsay Health Care, has terminated its funding agreement with health insurance giant Bupa.

On 4th May 2022, Ramsay Australia had given a notice to terminate the Hospital Purchaser Provider Agreement (HPPA) between itself and Bupa. Ramsay confirmed yesterday that the parties have been unable to reach a resolution on key elements of a new contract and as a result the contract between the two parties is now terminated.

Following termination both contractual and agreed transitional arrangements apply for a period of at least 60 days. Bupa insured patients will then be required to pay an upfront payment on admission, being the difference between the statutory default benefit Bupa is required to pay and Ramsay’s hospital treatment charges.

Ramsay is communicating with impacted patients to keep them informed and provide them with options, which in light of the portability rules in the Private Health Insurance Act include changing health funds.

According to Bupa, there are no immediate changes to the coverage for members. Bupa members remain fully covered at Ramsay hospitals until at least 1 October 2022, with some treatments including maternity and oncology, and any treatments already commenced covered up to August 2023. 

Bupa Health Insurance Managing Director Chris Carroll thanked members for their patience as Bupa worked towards an agreement that put our members first and helped minimise premium increases for our members while balancing hospital costs. 

“We want to move beyond this impasse and are continuing our efforts to reach an agreement that benefits our members and addresses health care costs,” he said.

“We are continuing our discussions with Ramsay and are hopeful of reaching an agreement soon. We want our members to know that our first priority in our negotiations with Ramsay has been to keep healthcare costs affordable especially when cost of living pressures continue to impact families,” he added.

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