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Thursday, 23 August 1984
Page: 257

Senator COLEMAN —Is the Minister representing the Minister for Health aware that the Hospital Benefits Fund of Western Australia specifically excludes private hospitals from participating in pharmaceutical insurance schemes? As this disadvantages members of those funds, will the Minister advise whether this is a usual practice of private health insurance funds? Does it apply only in Western Australia? Is the Hospital Benefits Fund the only fund which exercises that control?

Senator GRIMES —I was not aware that the Hospital Benefits Fund of Western Australia specifically excluded private hospitals from participation in its pharmaceutical insurance scheme. I am not aware of the specific details of schemes offered by other private health funds in other States. I can say, however, that the Commonwealth Government does exercise control over the private health funds, but as far as I know those controls relate only to the payment of the basic hospital table benefits. Honourable senators will be aware that the controls over the private funds were relaxed when Medicare was introduced. The funds were encouraged to diversify their activities and to offer a wider range of services and benefits.

The pharmaceutical insurance scheme referred to by Senator Coleman would be part of the health benefit funds' ancillary benefits package and would not normally come under the direct scrutiny or control of the Commonwealth. Because the Commonwealth regulates basic table benefits and requires all funds to offer the same benefits, the health funds normally use their ancillary benefits as part of their marketing strategy to give them a competitive advantage over other funds. Therefore, it is likely that almost all ancillary tables will be slightly different, offering different types of services, different levels of benefit and benefits for different numbers of services for different lengths of time.

The Commonwealth normally ensures that the marketing material put out by the health funds fairly represents the range of benefits and limitations of those benefits in the ancillary tables, so people who took out the health benefit fund 's ancillary table should have been aware that private hospital pharmaceuticals were specifically excluded from benefits. I might add, the cost of those ancillary benefits can also be a fair indicator of the range of benefits and their limitations. I am sure that honourable senators and others would appreciate that a very low-cost ancillary package would probably have more severe limitations on its benefits than one that cost considerably more. I will find out from the Minister for Health what other funds offer in the way of ancillary benefits and what limitations they place on those benefits and will advise the Senate as soon as I get that information.