Summary of Meeting 2 of the Improved Models of Care Working Group 5 June 2018

Page last updated: 04 July 2018

Summary of Meeting 2 of the Improved Models of Care Working Group 5 June 2018 (PDF 134 KB)


MembersMembers continued
Dr Jeffrey Harmer AO, ChairProfessor Ian Hickie AM, Brain and Mind Centre, University of Sydney
Janne McMahon OAM, Private Mental Health Consumer Carer NetworkDr Stephen de Graaff, Australasian Faculty of Rehabilitation Medicine
Belinda Highmore, Mental Health AustraliaChristine Gee, Australian Private Hospitals Association
Andrew Sando, Australian Health Service AllianceMarcus Dripps, Allied Health Professions Australia
Kelly Johnstone, BupaSecretariat
Professor John Horvath AO, Ramsay Health CareSusan Azmi, Secretariat
Peter Bailey, Wyndham Clinic Private HospitalDeb Hurlbut, Secretariat
Associate Professor Graham Mercer, Australian Medical AssociationMitch Docking, Secretariat


Jo Root, Consumers Health Forum
Dr Andrew Wilson, Medibank Private

1. Welcome, introductions, and conflicts of interest

  • The Chair opened the meeting and provided members not present at the first meeting an opportunity to introduce themselves to the Improved Models of Care Working Group (the Working Group).
  • Members did not declare any new conflicts.

2. Verbal updates

  • The Secretariat provided verbal updates on meetings of the mental health and rehabilitation sub-groups. The updates included a brief overview of the sub-groups’ membership, terms of reference and work plans.
  • Members were also advised on the key views of the sub-groups, in particular, the support for maintaining independent clinical decision-making, and ensuring high quality and safe care with good clinical outcomes.
  • The issue of efficiency was also raised. Some members were concerned about the ability to achieve the objectives of capturing system efficiencies and private health insurance premium affordability. Members generally agreed that it may be possible for private mental health and rehabilitation services to be delivered more efficiently at the individual patient level but system savings will be more difficult to achieve, particularly recognising the unmet demand for mental health services. Some members suggested that services and expenditure will continue to grow, but resources could be more efficiently allocated.

3. Types of treatment and settings

  • Members were updated on the sub-groups’ progress on considering types of treatment and clinically appropriate and efficient settings of care. Members acknowledged cost-efficiency and the affordability of private health insurance are key considerations of this work.
  • The Mental Health Sub-Group has sought to define the population group that best meets the remit of this work. Members were advised that the Mental Health Sub-Group agreed to focus on the population groups with severe and persistent mental illness, and severe and episodic mental illness.
  • Members generally agreed that mental health services will continue growing. While costs will grow to meet increasing demand, some members considered many services could be delivered more efficiently at the individual patient level.
  • The Rehabilitation Sub-Group has sought to identify the various types of private rehabilitation, and the clinical appropriateness of delivering each type of rehabilitation in alternative settings. For any individual, the appropriate setting would be influenced by the full range of clinical and social factors. Members also discussed ‘prehabilitation’ and whether this treatment type was in scope for models of care funded by private health insurance.
  • Members also agreed the private sector has an opportunity to drive innovative models of care, and improve the service offering by delivering services at the right place and time.

4. Data and evidence base

  • Members were advised that the Mental Health Sub-Group was generally of the view that evidence supporting community-based mental health services is not lacking. Members noted that the Private Psychiatric Hospitals Data Reporting and Analysis Service (PPHDRAS) will be presenting to the Mental Health Sub-Group at its next meeting.
  • Members were presented with rehabilitation data showing over 15 per cent average annual growth in private health insurance funded rehabilitation separations over the last 10 years. Members considered possible underlying contributors to the growth in rehabilitation separations. Members noted that the most common type of rehabilitation was following orthopaedic surgical interventions. However the growth in separations for orthopaedic surgeries, such as hip and knee replacements, is lower than the growth observed in overall rehabilitation separations.
  • Members noted that some of this growth in private rehabilitation services may be attributed to the shift in the delivery of services from admitted overnight care to same day rehabilitation programs.
  • Members were advised that the Secretariat is maintaining a log of the key research and evidence supporting the different types of rehabilitation and the clinical appropriateness of delivering these services in alternative settings.

5. Legislation overview and funding arrangements

  • A key component of work for the Working Group and sub-groups is identifying possible regulatory changes to private health insurance that support patient choice and access to clinically appropriate care regardless of setting.
  • The Secretariat provided an overview of the legislation governing private health insurance. This included a summary of the relevant parts of the Private Health Insurance Act and Rules, and the inherent link with funding arrangements.
  • Members agreed that the legislation is complex and can be difficult to interpret. Members noted that this complexity may potentially translate into variation in private health insurance product offerings and service delivery.
  • Members generally agreed that the current funding arrangements are a consequence of the existing regulatory environment. Members suggested that caution should be taken to not ‘retrofit’ or be restricted by existing regulation when considering improved models of care.

6. Incentives for admitted hospital-based care and barriers to alternative models

  • Members considered incentives for admitted hospital-based rehabilitation and barriers to alternative models. It was generally agreed that admitted patient care is incentivised as it attracts guaranteed funding through private health insurance while funding for alternative models, such as hospital-substitute treatment, may be more difficult to source.
  • Members were asked to identify the key incentives and barriers, and the relative importance of each in relation to possible reform options.
  • Members were advised that a key barrier identified by the Rehabilitation Sub-Group was legislative complexity. The difficulty with interpreting the existing legislation may discourage the development of innovative models that may in fact be permissible under the Act.
  • Members also discussed competition and whether the current policy settings are creating the right market incentives for privately insured community-based services as a viable and clinically appropriate alternative to admitted hospital-based care.

7. Other business

  • The next Working Group meeting is scheduled for 21 August 2018.

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