Health Department rejects push to clamp down on GUIs, citing lack of evidence

The Department of Health (DoH) has released the stakeholder feedback on the contentious General Use Items (GUIs) reforms. In a move likely to infuriate private health insurers, it has rejected calls for the implementation of system-based mechanisms to oversee their use.

This follows last year’s failed attempt to develop an alternative funding arrangement for GUIs. The government ultimately sided with hospitals and the medtech sector, keeping GUIs on the Prescribed List (PL). The official rationale pointed to unresolved implementation challenges and the financial pressures on private hospitals.

Stakeholder positions remain deeply polarised. Many in the private hospital and medtech sectors argue there is no clear evidence of misuse or waste of GUIs under current PL settings. They say increases in GUI expenditure are driven by genuine clinical needs and advances in medical technology. In contrast, private health insurers claim the system is being gamed – alleging overuse, inflated claiming practices, and minimal improvements in patient outcomes.

The private hospitals and the medtech sector strongly reject insurer narratives. They argue it is clinicians, not insurers, who should determine GUI use, and warn that current insurer behaviour, such as denying claims due to catalogue number mismatches or arbitrary interpretations of acceptability, undermines care. These practices breach private health insurance regulations, create unnecessary administrative hurdles, and shift financial risk onto private hospitals.

The medtech sector and private hospitals also counter health insurer claims of excessive growth in GUI utilisation. They cite major shifts in clinical practice as the true drivers. For example, the trend in bariatric procedures shifting to sleeve gastrectomy, meant a switch from gastric bands to staples, haemostats and sealants, increasing their utilisation. Also, in colorectal surgery clinical guidelines support laparoscopic colorectal resections due to better patient outcomes. This has resulted in increased use of cannula tubes, special surgical tools and staples and sutures.

Even the DoH’s own data contradicts the idea of rampant overuse. Between 2019 and 2022, GUI utilisation per episode of care fell from 2.90 to 2.64, and the benefit paid per episode dropped from $635.58 to $557.77. IHACPA’s report in December 2022 also showed only modest annual increases in benefits and usage for staples and tackers – benefits per episode increased by ~1.5% annually, benefits per item by ~0.5%, and items per episode by ~0.9% over a four-year period – far from the blowout insurers have suggested.

For many private hospitals and the medtech industry, the real integrity issues lie not within GUI usage itself, but in systemic barriers imposed by insurers, such as restrictions on listing new technologies and funding refusals for PL items already used in patient care. These constraints, they argue, are eroding clinician autonomy and threatening access to innovation.

The potential fallout of imposing blunt system-based controls is significant. Private hospitals warn that overly rigid policies could escalate costs for patients, limit access to best-practice treatments, and undermine the value of private health insurance. There is also concern that more complex or high-needs patients will be increasingly offloaded to the public system, exacerbating pressure on public hospitals.

“Capping or bundling GUIs is not practical,” hospitals stressed, reinforcing that clinical discretion is paramount. Any restriction imposed by non-clinical bodies risks compromising patient care.

In a rare moment of agreement, most stakeholders support practical steps to improve integrity, such as better access to data and more targeted education on GUI utilisation and waste management. The DoH has committed to exploring these options. It will also examine concerns about growth in specific GUI groupings by working directly with clinicians to determine whether increases are clinically warranted.

In reimagining healthcare across the entire patient journey, Health Industry Hub^TM is the only one-stop-hub uniting the diversity of the Pharma, MedTech, Diagnostics & Biotech sectors to inspire meaningful change.

The Health Industry Hub^TM content is copyright protected. Access is available under individual user licenses. Please click here to subscribe and visit T&Cs here.