News & Trends - MedTech & Diagnostics
New hospital fees spark uproar as patients caught in crossfire of private healthcare disputes

The Australian Medical Association (AMA) is urgently calling on Healthscope, Bupa, and the Australian Health Service Alliance (AHSA) to re-enter negotiations to resolve their disruptive funding disputes, which could soon impact millions of patients with new out-of-pocket fees.
Healthscope, Australia’s second-largest private hospital group, plans to impose a $50 “hospital facility fee” for same-day services and $100 for overnight stays starting on 26 November, affecting up to six million Australians.
AMA President Dr Danielle McMullen expressed serious concerns, emphasizing that patients are at risk of becoming “collateral damage” amid these financial disputes between the private hospital operator and private health funds.
“Patients are completely innocent bystanders in this unacceptable squabble, as they now face higher out-of-pocket costs imposed by Healthscope,” said Dr McMullen.
“Doctors are also caught in the middle of these kinds of disputes, as they receive limited information about the proposed new fees and are inevitably forced into situations where patients ask for advice on whether they should switch funds. Our focus as a profession is on providing the best possible clinical care, not becoming de-facto financial advisors for our patients,” she added.
Amid the AMA’s criticisms, Australian Private Hospitals Association (APHA) CEO Brett Heffernan responded pointedly, saying “A bit rich from doctors, almost all of whom charge their patients very hefty gaps. Surgeons, the full gamut of specialists, as well as anaesthetists are charging hundreds of dollars each in gaps to their patients as a matter-of-course as they insist what they get paid from insurers isn’t enough. But it’s a disaster for patients if a hospital charges a minimal gap because insurers won’t even meet their costs? Get a grip.”
Heffernan further warned of a “real disaster” if more hospitals are forced out of business due to restrictive pricing conditions.
“Let’s face it, private hospitals are the only part of the system that is locked into the ridiculous reality of a contract that precludes them from adjusting prices when expenses increase, even to the point of plunging hospitals into a position where they are no longer viable,” Heffernan said.
The funding gap remains a growing problem for many private hospitals. Ramsay Health Care’s Chief Policy Officer, Dean Breckenridge, recently underscored the challenge, explaining that private health insurance premiums are increasing by only 3-4%, while hospital costs are climbing by around 6%, resulting in substantial financial shortfalls and putting pressure on hospitals to reassess their operational models.
Rachel David, CEO of Private Healthcare Australia, condemned Healthscope’s approach, calling it a “new low” by Brookfield, Healthscope’s private equity owner, accusing it of extorting funds to boost profits for overseas investors.
“This is a deeply unethical move from a $1 trillion North American private equity firm holding patients hostage and trying to bully health funds into paying them more so they can increase profits,” she remarked.
“Brookfield was only ever in the Australian hospitals market for the short term. It is trying to squeeze out as much profit as possible before it abandons Healthscope hospitals, potentially making private healthcare unaffordable in the process.”
Dr McMullen reiterated the AMA’s stance on the need for a Private Health System Authority to protect policyholders.
“Policy holders are sick of private hospital groups and insurers constantly at loggerheads,” she remarked. “It undermines the confidence Australians have in private health insurance arrangements and almost always leads to higher out-of-pocket charges at a time people are facing significant cost-of-living pressures.”
Such an authority, she argued, would enable long-term reform and regulation to guarantee Australians receive real value from private health insurance and help mediate disputes like these.
Andrea Caton, HCF’s General Manager of Member Health Strategy and Planning, recently advocated for an independent advisory body – not authority – to guide government reforms, aligning all stakeholders’ interests.
Dr McMullen concluded with a strong call for unity in patient care, stating, “It is time to strike a deal that puts the needs of patients first, while also delivering a reasonable return for all parties and recognising the rising costs of providing quality care.”
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