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Intraocular lens prices under review

28/09/2016
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The Federal Department of Health is to review pricing for products on its mandated fixed-price Prostheses List, including intraocular lenses (IOL), which are inserted after cataractous lenses are extracted.
Rod Sims, ACCC chairman
Rod Sims, ACCC chairman

Prices for products listed on the Prostheses List have not been changed since 2006, even though prices overseas have fallen.

The crux of the matter comes down to the substantial differences in prices to private versus public patients for the same medical device, with prices to major public hospitals and large private hospitals who can negotiate bulk deals contributing to the situation. If a patient is provided with a listed prosthesis at a private hospital, it costs considerably more than if it is provided at a public hospital.

Private health insurance funds have blamed the price discrepancy on suppliers, calling on the Australian Competition and Consumer Commission (ACCC) to investigate the high prices the funds are being charged for prostheses such as IOLs, internal heart defibrillators, cardiac pacemakers, coronary stents, and knee replacements. However, ACCC chairman Mr Rod Sims said on 23 September that the Commission would await the results of the Federal Government review before considering an investigation into the concerns.

The health funds cited an IOL used in more than 6,000 private procedures in Australia during 2015 as costing $374 versus $88 in the UK and $33 in Turkey. Another example was an internal heart defibrillator costing $52,000 locally compared to $28,040 in the UK, $22,460 in Ireland, $19,284 in Portugal, $16,645 in the Czech Republic, and $15,318 in Sweden.

The funds maintained that they could save $800 million if the prices on the Prostheses List were reformed, which would lead to lower premiums.

The Medical Technology Association of Australia (MTAA) opposed the funds' claims, with then chief executive officer, Ms Susi Tegen (a former CEO of the Royal Australian and New Zealand College of Ophthalmologists), speaking out against a reduction in prices for prostheses.

She pointed out that while health-fund premiums had increased significantly, the price of medical devices had not.

Clinicians should be at the centre of specifying patient care, not health insurers, Ms Tegen said.

Soon after, in an unconnected move, Ms Tegen resigned from her position at the MTAA, citing health grounds.

Some of the MTAA's members include the large American diversified health suppliers Johnson & Johnson and Medtronic.

Private Healthcare Australia, which covers larger health funds, insisted the facts spoke for themselves: that Australian private patients are paying too much for medical devices compared to public patients and comparable international markets.

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