HIP POCKET PAIN IS HITTING AUSTRALIANS HARD

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1 MEDIA RELEASE - EMBARGOED AND NOT FOR USE UNTIL MONDAY APRIL 29TH, 2013 HIP POCKET PAIN IS HITTING AUSTRALIANS HARD New Consumers Health Forum (CHF) campaign reveals Australia has among the highest out of pocket healthcare costs in the world. Australia is now in the top 5 highest spending nations in the world when it comes to Hip Pocket Pain. Australians (per person) now pay double the amount in out of pocket costs of people in the UK or France. CHF represents over 2 million health consumers through its networks across the nation and says a staggering 19.3% 1 of the nation's total health costs are now being paid by health consumers straight out of their own pockets. Australians pay $1075 a year in average out of pocket costs - $94 above the weighted average for OECD western nations 2. A two-tiered health system is developing in Australia, giving better care access to those who can afford to pay while others struggle to afford essential health services. Evidence of the growing inequity of this Hip Pocket Pain, and experts calls for systemic change to the health system, are published in the latest Health Voices, the CHF journal. Breast cancer survivor Leonie Havnen says thousands of Australians (including herself) are now using superannuation funds to pay for spiralling medical bills and says it is shameful. Consumers Health Forum CEO Carol Bennett says Australians are among the hardest hit in the world when it comes to out of pocket costs and data show more and more people are not seeing medical specialists, doctors and dentists nor getting scripts, purely because of cost 3. The latest available data show Australia has among the highest out of pocket costs in the world, warns the Consumers Health Forum of Australia (CHF). CHF - which is the national not-for-profit peak body representing over 2 million health consumers through its network across the nation - says the data paints an appalling picture of what is happening to Australian health consumers. 1 Source: AIHW Health Expenditure Source: AIHW Health Expenditure Source: ABS

2 CHF CEO Carol Bennett says 19.3% of the nation's total health costs are now being paid directly by consumers straight out of their own pockets. She says we are among the hardest hit when it comes to out of pocket costs and we're among the highest spenders in the world for out of pocket costs. The nation that pays the most in out of pocket costs globally is Switzerland. Australia is ranked 5 th in the OECD on out of pocket costs 4. Latest available data show Australians paid $1075 a year on average in out of pocket costs - which is $94 above the weighted average for OECD western nations. Carol Bennett said, Out of pocket expenses are a cause for alarm. Our health system is failing us. It's failing when consumers have to consider whether they can afford to see a doctor promptly or buy essential medication. It's failing in terms of the massive waiting times for elective care in public hospitals. Put simply we no longer have a universal health care system which actually meets people s needs. In many cases it is no longer a safety net. The blame game has to stop. The issue has to be fixed. Medicare was built 40 years ago and we are now 40 years down the line in a different world altogether." The term out of pocket is an outmoded phrase. It implies small extra fees. In many cases that's just nonsense. Thousands of Australians are using superannuation funds to cover medical gaps - that cannot possibly be acceptable to anyone." CHF highlights that a typical Australian family is shelling out $500 a year on doctors' bills alone to meet the huge gaps not met by Medicare and are then shelling out a further $1200 a year on over the counter medicines not covered by the PBS 5. The new Consumers Health Forum campaign warns: A two tiered health system has now emerged as more and more people delay seeing a doctor or dentist purely because of costs. Data shows the number of people delaying or not seeing a GP for cost reasons was 8.7% in a jump on the previous year s figure of 6.4%. Close to a fifth of Australia's total health costs are now being paid directly by consumers as "out of pocket expenses" - Carol Bennett says this is alarming. One in eight health consumers is experiencing financial barriers to accessing medical specialists 7. Australians are paying more than ever for health and getting less. More than half of all elective surgery now happens in private hospitals 8, which benefits the 45% of Australians who have private health insurance, but they often still face large gap costs. Australian private hospital and surgery costs are often well above most other countries, pushing health insurance premiums ever higher. Total fees for cardiac 4 Source: AIHW Health Expenditure Source: AIHW Health Expenditure Source: ABS figures cited by COAG Reform Council, Source: ABS figures cited by COAG Reform Council Report, Source: AIHW hospital statistics, 2011

3 bypass surgery done privately typically total $43,230 US in Australia, three times the average cost in public or private hospitals in the UK. 9 25% of Australians (a quarter of the nation) won't see a dentist purely because of cost and that rises to 30 per cent of health card holders 10. Figures show thousands of Australians have been using superannuation funds to pay for medical bills with one estimate suggesting over 14,000 Australians have applied to the Department of Human Services, to access superannuation savings to pay for health costs 11 and 8,000 people were given access to $79 million. Leonie Havnen is just one of the people backing the messages in the campaign. She says out of pocket expenses for consumers have reached deeply disturbing levels. She says the term "out of pocket expenses" implies small extra expenses and that's just total nonsense in many cases. Leonie is a survivor of breast cancer and is now out of pocket to the tune of over $40,000. Leonie has had to use superannuation funds to pay medical bills and has needed life-saving surgery, chemotherapy and medications. As a single parent she is struggling to meet ongoing medical expenses including life-saving medications. Leonie has had to cancel dental appointments due to lack of funds and even stopped taking one medication due to costs. Leonie Havnen says, Politicians should be ashamed of themselves making people with life threatening illnesses or chronic diseases pay for medication or treatment. We've paid taxes for the majority of our working lives. We need change. You cannot say our system is fair and looks after people." What has been of great distress to me as a single mother is I've had to access my nest egg to pay for my medical treatments. Some people have had to sell their homes or declare bankruptcy because of spiralling health costs." Carol Bennett says it is a sad indictment on the health system that vulnerable people have to use their life savings to fund critical operations. Robert Pask is also backing the campaign. He has multiple sclerosis plus other health issues including Type 1 Diabetes and arthritis. Robert Pask says, I have neurological pain. After the rebates I'm still paying $70 a month out of my own pocket. I can't afford the anti-fatigue medication that would be costing me $220 a month. I can't afford the $4,600 annual fee for medication that my neurologist says may help with my mobility. I think the current system is ridiculous and just doesn't support people who are most vulnerable." Consumer advocate Jan Donovan says from her own family experience it was clear that childbirth costs posed a heavy burden on many couples already wrestling with mortgages. "Obstetrician fees leave privately insured young parents out of pocket by $5,000 or more, plus other hospital costs amounting to hundreds of dollars. 9 Source: International Federation of Health Plans survey 10 Source: ABS figures cited by COAG Reform Council Report, Source: Sue Dunlevy, The Australian, Nov 25, 2012

4 That's the price of having choice of doctor but why should it cost so much, particularly for women at this vulnerable point in their lives?" Carol Bennett added, The inequality is huge. People who have the means can afford to benefit from the best treatment available. People without may not benefit at all. People on lower incomes are more likely to have chronic conditions that need specialist care. What we are seeing in some cases is a triple whammy affect. People pay taxes and pay for private health insurance and then there are still out of pocket expenses." Media enquiries to: Ross Woodward on The Top Ten Biggest Spending Nations in the World on Out of Pocket Costs (per person as of 2010 in Australian dollars): Rank Nation Out of Pocket Costs (per person) 1 Switzerland $ Greece $ USA $ Belgium $ Australia $ Portugal $ Korea $980 8 Ireland $969 9 Sweden $ Canada $946 Results of Other Nations: 11 Finland $ Iceland $ Denmark $ Germany $ Slovak Republic $ Italy $ Mexico $ Hungary $ Chile $ New Zealand $ Slovenia $ Poland $ UK $ France $ Czech Republic $ Estonia $360

5 Key Points At A Glance: Australia now has amongst the highest out of pocket costs in the world. 19.3% of Australia's total health costs are now paid directly by consumers as so called "out of pocket" expenses 12. In short, close to a fifth of our nation's health costs are funded through out of pocket costs. Australians paid $1075 a year on average in out of pocket costs 13, $94 above the weighted average for OECD western nations. Thousands of Australians are now using superannuation funds to cover medical gaps. It has been reported that 14,000 Australians applied to the Department of Human Services to access superannuation savings to pay for health costs. Breast cancer survivor Leonie Havnen is supporting the new Consumers Health Forum campaign. She needed life-saving surgery and chemotherapy and has had to use her superannuation to fund this - she's out of pocket by over $40,000. MS sufferer Robert Pask is also supporting the campaign and says he cannot afford many of the medical fees he needs. Nearly 60% of all elective surgery now happens in a private hospital --- outside the reach of more than half of Australians who do not have private health insurance. The number of people who won't see a GP because of costs has jumped from 6.4% to 8.7%. The Consumers Health Forum says this is a disturbing trend. CHF says a typical Australian family shells out $500 a year on doctors' bills alone because of the gaps not met by Medicare, then a further $1200 a year on over the counter medicines not covered by the PBS. 25% of Australians - a quarter of the nation - won't see a dentist purely because of cost. This increases to 30% for those on health care cards. 12 Source: AIHW Health Expenditure Source: AIHW Health Expenditure