HCF gives in to NSW government demands on hospital bed rates
Private health insurer HCF has agreed to double the amount it pays for its members to use single rooms in NSW public hospitals in response to mounting pressure from the NSW government.
Under the changes, the not-for-profit fund will pay the state government $892 a day for a single NSW public hospital room, compared to the federal government rate of $436 a day, which it was paying previously.
The move comes after the Minns government last week passed legislation which will allow it to double a tax on private health cover if the insurers do not pay the gazetted $892 bed rate.
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Private health insurers are in a battle with the NSW Government over single room rates in public hospitals. HCF has just agreed to double the amount it was paying. 9News
Treasurer Daniel Mookhey and Health Minister Ryan Park said on Monday the nation's three biggest for-profit private insurers, Bupa, NIB and Medibank, were still refusing "to pay their bills in full".
In the last financial year, NIB paid a room rate of $491, Bupa paid $501 and Medibank $515.
"HCF has decided to do the right thing and return to paying its fair share in the public health system," Mookhey said.
"However the three big for-profit private health funds, backed by the Liberal party, are continuing to argue for taxpayer subsidies to their businesses during a cost-of-living crisis.
"This is wrong - they should just pay their bills."
Park said big health insurers were expecting NSW public hospitals to subsidise their record profits.
Private health insurers have warned they may have to hike their premiums in response to a health tax introduced by the NSW government. Isabella Porras
HCF chief executive Sheena Jack said in a statement the fund had "reluctantly agreed" to the government's "unreasonable demand" to pay the higher room rate as it was seen as the lesser of two evils for its members, the other being the newly-legislated health tax.
"However the NSW Government has no legal basis on which to demand payment of this inflated single room rate. Indeed it is incorrect to suggest that HCF is not paying the correct rate or owes the NSW Government anything," Jack said.
Jack did not rule out increasing premiums, saying: "It is important to understand that HCF cannot just absorb this cost and there will be an impact on members."
NIB told the Australian Financial Review it had also agreed to pay a higher bed rate but would not say how much.
"We are disappointed with the whole situation. Ultimately, we are pragmatic and if we can avoid an additional tax which would add an average $156 to every policyholder that is the position we have taken. Our offer to NSW Health is significantly higher than where we were previously," NIB chief executive Mark Fitzgibbon told the paper.
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