Consultation Paper on Private Health Insurance (PHI) Default Benefit Arrangements

Overview

Informing the Private Health Insurance Default Benefits Arrangement study

Ernst & Young (EY) has been contracted by the Department of Health and Aged Care (the Department) to undertake a study of private health insurance (PHI) default benefit arrangements (the PHI default benefits).

PHI default benefits include ‘minimum’ and ‘second-tier default’ benefits, both of which are defined in the Private Health Insurance (Benefit Requirements) Rules 2011 and are regulated by the Commonwealth. They are paid by health insurers to eligible hospitals for the treatment of privately-insured inpatients in specific circumstances where there is not an agreed contract in place between the health insurer and the hospital.

An aim of PHI default benefits is that they support improvements in accessibility and efficiency of privately insured hospital services for healthcare consumers.

This Consultation Paper (as below) has been prepared by EY to inform the study, which includes consideration of potential reform options for PHI default benefits and how can they influence contracting arrangements between hospitals and health insurers.

What happens next

The consultation period for response to this paper closed 23 September 2022. If you have any questions about the paper or would like to discuss the study, please email phidefaultbenefits@au.ey.com.

Feedback received as part of this consultation process will contribute to a study report including reform options. The study is scheduled for finalisation by the end of 2022.