Private health insurers now offer telehealth services for primary care physicians. Does this pose a risk to Medicare?

Australia’s second largest private health insurer, Bupa, recently did so he started offering its members receive three free telehealth consultations with a primary care physician per year. It mimics other insurers such as nib offers its members digital GP consultations, including prescriptions and medical certificates, for a fee.

But if you search the govt Compare the website with the rules which helps people choose from a variety of private health plans, you won’t find any plans that officially cover visits to your GP.

This is because it is so currently illegal that insurers cover the costs of out-of-hospital services that are also funded by Medicare, which includes visits to primary care physicians and specialist visits.

Insurers can get around this problem by running their digital health platforms as a separate company rather than as part of private health plans that are highly regulated by the government. Another strategy is to pay the clinic’s overhead costs which then offer “free” consultations to members.

So why might private health insurers move into primary care? Why wasn’t it allowed? Is this a risk to Medicare?

Keeping people out of the hospital saves money

Better access to (primary) healthcare can improve people’s health and reduce the risk of hospitalization, especially for people with chronic diseases such as heart disease, diabetes and asthma.

Sometimes people apply emergency services for minor problems which can be solved by your family doctor.

So offering members free or low-cost and easily accessible primary care can result in lower hospital costs and save insurers money in the long run.

There are other reasons why private insurers want to cover primary care costs.

The first is the potential for “cherry picking.” In Australia, private health insurance operates under a community rating a system in which contributions do not depend on a person’s health or age.

This means that insurers cannot exclude or charge higher rates for people at higher risk of needing surgery or other hospital treatment (except Loading Lifetime Health Coveragewhich applies to the first private health insurance after the age of 31).

However, insurance companies often have strategies to attract healthier members. For example, they may offer free running shoes to appeal to avid runners or age-based discounts for modern members under 30 years of age.

The target audience for free or easily accessible GP telehealth services is likely to be working professionals who are tiny on time or younger people. These groups are generally healthier and are less likely to be hospitalized each year.

Another reason insurers may want to cover primary care is to assist retain members who feel they are receiving real benefits and a sense of value from their insurance plans.

When Medibank tried to offer free GP visits in 2014, members using the service reported that rather stay with the insurer.

Across the health system, the Australian Government is moving forward telehealth and multidisciplinary teams (for example, GPs, nurses, dietitians, physiotherapists and specialists) to treat long-term conditions.

In response to these changes, insurance companies are preparing for the future of health care delivery through developments in digital health and the creation of gigantic clinics housing multidisciplinary teams. Offering free GP services via telehealth is a diminutive step towards this massive strategic change.

Why haven’t insurers offered primary care in the past?

When Medicare was introduced in 1984, doctors opposed allowing private health care funds to cover the “gap” between Medicare benefits (what the government pays the doctor) and wages (what the doctor collects).

Following lobbying from the Australian Medical Association, then Health Minister Neal Blewett, he stated allowing insurers to cover the gap would simply enhance the cost of services, especially for those without insurance – with no benefit to patients.

Therefore, a ban on primary health care insurance was introduced legally regulated.

Over time, whenever the question of allowing private insurers to cover primary care arose, the main argument against this option was that it would create two-tier system. In such a system, people without private insurance would have worse access to primary health care.

ABOUT 45% population has private insurance. And with insurers footing the bill, it’s likely that prices for a GP consultation will enhance would increase.

Additionally, private funds would likely pay more than Medicare to encourage primary care physicians to participate. This would disadvantage people who do not have private health insurance.

This situation is currently taking place in the hospital sector. Surgeons earn much more for operations in private hospitals compared to doctors public hospitals. This makes them prioritize working in private hospitals.

Thanks to this, patients with private health insurance can immediately proceed to planned procedures. Meanwhile, people who do not have private insurance must take into account longer waiting times.

Should the government allow private insurers to cover primary care?

Current evidence does not provide much support for the government supporting the private health insurance industry by subsidizing insurance premiums for individuals.

Our research found that despite the government spending billions of dollars each year to subsidize private health insurance, the sector has barely made a dent in the public hospital system.

Currently, the ability of private insurers to offer primary care is constrained by law and should continue to be so.

Allowing private insurers to continue to expand into primary care would undermine the universality of Medicare. This risks creating a two-tier primary care system, repeating the disparities we have already seen in hospital care.

Insurer-funded primary care would also involve high administrative costs, as seen in the healthcare system United Stateswhich relies heavily on private financing and supplies.

However, the government should take other steps to make primary care more affordable, which would save on the costs of downstream hospitals and emergency departments. This includes:

• increasing Medicare rebates to keep primary health care free for the indigent and children, regardless of where they live
• making free primary health care available to rural and remote areas
• making primary health care cheaper for others.

The Australian Government has the financial capacity to make primary care more affordable and should prioritize its implementation. Even private insurance companies recognize its advantages. However, this could not be achieved through private health insurance, which would make primary care more unequal and more steep.