Australians want to know more about private health insurance

Australians find the costs of private healthcare difficult to understand, and want more certainty about potential out-of-pocket costs, the latest Medibank Health Check survey shows.

The survey of more than 1500 people was conducted in January this year, and asked what information Australians wanted about private health insurance policies, private hospitals, and specialists.

Australians want to be able to easily find, understand, and compare information

More than half of those surveyed said they found the costs of private healthcare hard to understand.

Nearly all respondents wanted greater certainty about potential out-of-pocket costs, with almost two in three people ranking this information as the most important factor in how they choose private healthcare providers and private health insurance products.

Medibank Chief Medical Officer, Dr Linda Swan, says the survey findings highlight the need for the private healthcare sector to be more open and transparent about the price, performance and quality of services.

“Australians want to be able to easily find, understand, and compare information so they can make informed decisions about their private healthcare,” she says.

“Australians should be able to know, for example, how much they might have to pay out of their own pocket between different specialists or hospitals, the outcomes they can expect from the care provided by different specialists, and what is included or excluded from their private health insurance cover.”

Medibank recently made a submission to the Federal Government’s review into private health insurance, and recommended a number of reforms to deliver improved transparency, affordability and value.

“We want to empower Australians to make informed decisions and better healthcare choices, whether that’s about which specialist they want to see, which hospital they want to go to, or which private health insurance product they should have,” Dr Swan says.

Medibank’s recommendations include improved information-sharing for consumers and insurers and standardised products and terminology.

“These reforms would not only help Australians to better understand the costs of private healthcare and allow them to make more informed choices, but could also drive improvement in the delivery of private healthcare services.”

Here are some of the key things the survey showed.

People find it hard to understand the costs of private healthcare:

• Only 45% of people agree that it’s easy to understand the costs of private healthcare.
• Only 38% believe private healthcare in Australia is affordable and value for money. This perception of private healthcare decreases with age, with only 22% of people aged 55-64 agreeing that it is affordable.
• There is a marked difference in perception of affordability of private healthcare between people with and without insurance cover. 48% of people with insurance believe it is affordable, compared to only 24% of people without insurance.

People want to understand more about different aspects of private health insurance

• Information about out-of-pocket expenses was the most important, with 65% rating it as “very important” and 30% as “important” (95% want more information and to better understand out-of-pocket costs). The relative importance of understanding out-of-pocket costs increased with age, with 74% of people aged 55-64 rating it as “very important”.
• 43% rated information about the quality of care as “very important”.
• 40% said information to allow them to compare the quality of different providers and hospitals was “very important”.

Simpler, easy to understand insurance policies was rated as the best way to improve the private health insurance experience

• 34% rated simpler, easy to understand policies as the best way to improve their experience.
• 29% rated easy to understand information about out-of-pocket expenses as best way to improve their experience.
• 21% rated standardised terminology to enable comparison of services offered by different providers as “most important”.