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Open Access Article << Previous     |     Next >>   Contents Vol 35(2)

A survey of reimbursement practices of private health insurance companies for pharmaceuticals not covered under the Pharmaceutical Benefits Scheme 2008

Senthil M. Lingaratnam A E , Sue W. Kirsa A , James D. Mellor A , John Jackson B , Wallace Crellin C , Michael Fitzsimons D and John R. Zalcberg C

A Pharmacy Department, Peter MacCallum Cancer Centre, St Andrew’s Place, Melbourne, VIC 3002, Australia. Email: sue.kirsa@petermac.org; dan.mellor@petermac.org
B APHS Pharmacy, 6 Dividend Street, Mansfield, QLD 4122, Australia. Email: john.jackson@aphs.com.au
C Peter MacCallum Cancer Centre, St Andrew’s Place, Melbourne, VIC 3002, Australia. Email: whc@melbpc.org.au; john.zalcberg@petermac.org
D Medicines Australia, Level 1, 16 Napier Close, Deakin, ACT 2600, Australia. Email: michael.fitzsimons@medicinesaustralia.com.au
E Corresponding author. Email: senthil.lingaratnam@petermac.org

Australian Health Review 35(2) 204-210 http://dx.doi.org/10.1071/AH10894
Submitted: 28 February 2010  Accepted: 8 September 2010   Published: 25 May 2011


 
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Abstract

Objective. To describe the current practices and policy of Australian private health insurance (PHI) companies with respect to cover for pharmaceuticals not subsidised under the Pharmaceutical Benefits Scheme (PBS).

Design, setting and participants. A 2008 review of web-published policy statements for top-level hospital and comprehensive general treatment insurance, and survey of reimbursement practices by way of questionnaire, of 31 Australian-registered, open-membership PHI companies.

Main outcome measures(s). Description of the level of pharmaceutical cover and important considerations identified by PHI companies for funding non-PBS pharmaceuticals through benefit entitlements or ex-gratia payments.

Results. Nine of thirty-one PHI companies (29%) provided responses accounting for ~60% market share of PHI. The majority of smaller PHI firms either declined participation or did not respond. The maximum limits offered for non-PBS pharmaceuticals, under comprehensive general treatment insurance, varied significantly and typically did not adequately cover high-cost pharmaceuticals. Some companies occasionally offered ex-gratia payments (or discretionary payments in excess of the policyholder’s entitlement benefits) for high cost-pharmaceuticals. Factors considered important in their decision to approve or reject ex-gratia requests were provided. All results were de-identified.

Conclusions. There is little consistency across PHI companies in the manner in which they handle requests for high-cost pharmaceuticals in excess of the defined benefit limits. Such information and processes are not transparent to consumers.

What is known about the topic? Pharmaceuticals that are not accessible via the Pharmaceutical Benefits Scheme (PBS) may be subsidised through private health insurance. The level of cover through general treatment insurance and hospital insurance varies according to the insurer or policy type and hospital–insurer agreement respectively.

What does this paper add? An increasing proportion of lower cost, high volume pharmaceuticals that are available to consumers without any form of Commonwealth subsidy, under current arrangements, also do not attract any form of PHI cover. There is also little consistency across PHI companies in the manner in which they handle requests for high-cost pharmaceuticals in excess of the defined benefit limits and that such information and processes are not transparent to consumers.

What are the implications for practitioners? PHI could be better engaged to play a more significant role in helping maintain consumer access to essential medicines.



References

[1]  National Health Amendment (Pharmaceuticals Benefits Scheme) Act 2007.

[2]  Media Release. Strengthening your PBS. Minister for Health and Ageing, Tony Abbott MHR. 16 November 2006.

[3]  Hynd A, Roughead EE, Preen DB, Glover J, Semmens J. The impact of co-payment increases on dispensings of government-subsidised medicines in Australia. Pharmacoepidemiol Drug Saf 2008; 17: 1091–9.
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[4]  Australian Institute of Health and Welfare. Health Expenditure Australia 2006–2007. Health and Welfare expenditure series no. 35. Canberra: AIHW; 2008.

[5]  Sub-Committee DU. Australian Statistics on Medicines 2007. Canberra: Department of Health and Ageing, Drug Utilisation Sub Committee; 2009.

[6]  Easing the pressure: the intergenerational report and Private Health Insurance. Submission to the Productivity Commission, prepared for Medibank Private. Econtech Pty Ltd; 2004. Available at http://www.econtech.com.au/Health.aspx [verified 2 May 2011].

[7]  Vaithianathan R. An economic analysis of the Private Health Insurance Incentives Act (1998), Discussion Paper No. 427. Canberra: Centre for Economic Policy Research, The Australian National University; 2001.

[8]  Banks G. The Industry Commission’s Report on Private Health Insurance in Australia. Chairman’s keynote address to the Conference: ‘The White Paper on PMI – Looking to the Future’, Dublin, Ireland, 28 May 1998. Productivity Commission. Available at http://www.pc.gov.au/speeches/cs19980528 [verified 21 April 2011].

[9]  Duckett SJ. Drug policy down under: Australia’s Pharmaceutical Benefits Scheme. Health Care Financ Rev 2004; 25: 55–67.
| PubMed |

[10]  Sansom L. The subsidy of pharmaceuticals in Australia: process and challenges. Aust Health Rev 2004; 28: 194–205.
CrossRef | PubMed |


   
 


    
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