The Australian Society of Ophthalmologists (ASO) is calling on insurers to “lift their game” as part of its support of Health Minister Mark Butler’s demand for insurers to deliver better value and greater accountability.
Minister Butler criticised insurers recently for failing to meet the expected 87% return-to-service benchmark and announced plans for a new “consumer value and market integrity” test when assessing premium increases.
He highlighed “phoenixing”, where insurers retire gold-tier policies only to reintroduce near-identical, higher-priced products.
The minister also highlighted mounting pressure on private hospitals, with profit margins plummeting from 5.1% in 2020–21 to just 0.1% in 2023–24, as investment in the sector continues to decline.
In a media release, ASO president Dr Peter Sumich said the minister’s comments echoed long-held concerns from the medical community.
“Private health insurers have an obligation to return value to their members and support the hospitals and doctors who deliver essential care,” he said.
“When less than the expected benchmark is returned to services, patients ultimately pay the price. Greater accountability is urgently needed.
“We are seeing private hospitals under extreme pressure, with margins falling to near zero. This creates real risks for patients, doctors, and the sustainability of the entire private system.
“If insurers don’t lift their game, the sector will continue to bleed investment.
“The practice of retiring gold-tier policies only to replace them with near-identical, more expensive products is unacceptable. It undermines trust, disadvantages patients, and fails the integrity test the minister has rightly called out.”
In the release, the ASO has also said that managed care, often promoted as cost-saving, comes with serious risks for patients, including reduced choice of doctors and hospitals, out-of-network penalties, treatment delays due to pre-authorisations, and potential conflicts of interest where profits are prioritised over patient care.
The ASO has joined the Australian Medical Association and Australian Private Hospitals Association and many others in backing the push for greater insurer accountability and would continue to advocate for reforms that protect both practitioners and patients.
“The ASO strongly supports reforms that protect patients and the practitioners who care for them,” Dr Sumich said.
“Ophthalmologists see first-hand how vital it is that private health insurance delivers value, not just profits. We back the minister’s call for change and stand ready to contribute to solutions.”
