The next instalment of the Dialogue Podcast series explores how a simple innovative addition to private health insurance (PHI) can alleviate ‘bill shock’ and reduce out-of-pocket costs for those diagnosed with cancer.
In the podcast, Ignatius Li (Partner at Deloitte) questions Anthony Lowe (former CEO of the Prostate Cancer Foundation of Australia) and Jamie Reid (Principal at Finity Consulting) on the recommendations and research in their Dialogue thought leadership paper ‘Private Health insurance Bill Shock: What Can Insurers Do to Help?’.
In the paper, Anthony and Jamie extrapolate on the surprising and distressing impact of out-of-pocket costs for those with PHI facing a cancer diagnosis.
“…a recent study of men who had been diagnosed with prostate cancer showed median out of pocket expenses for those with PHI were $6,000 compared to $2,000 for those without. Although private cover does provide the benefits of choice of specialist, private rooms and generally lower waiting times, the cost differential is significant.”
The pair argue that the knowledge gap on this issue between the public and industry insiders is wide. Anthony clarifies the varied reasons why this is so:
“…because it’s called ‘insurance’ [many Australian’s] they’re sort of under the belief that they would cover everything so it’s kind of like discovering that you’ve got you know buildings insurance, but your roof wasn’t covered for example. I think most Australians just automatically assume that they won’t face a bill of five or 10 thousand dollars if they get diagnosed with cancer, unfortunately that’s not the case.”
Currently PHI does not cover many of the factors that drive current treatment costs including:
- Medicare pricing
- New technology
- Bureaucratic hurdles
- Ancillary expenses (travel, medical costs)
Jamie and Anthony suggest additional innovation is needed, in the form of legislative change that would allow private health insurers to pay a $5,000 lump sum to people diagnosed with cancer. The cost of providing the small lump sum benefit is around $2.30 per person for month.
“Any rise in premiums requires considerable scrutiny,” said Jamie. “But providing additional benefits, particularly following a life-changing diagnosis, adds significant value to PHI.”
Listen in to find out more on Anthony and Jamie’s research and innovative recommendation.
Download Transcript here.
Access the Paper and Media Release here.
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