Many independent practices have been asked to explain to their customers why they have a greater than expected out-of-pocket cost for their services than through their Health Insurers own outlet. When the customer is advised to refer back to their insurer the Insurer’s hotline staff blame the independent Optometrist saying it is their fault and they are ‘too expensive’.
This is affecting the Dental industry in a big way and is starting to become a more major issue in our industry too. Health Insurers appear to be using their member data and claims history to market directly to their customers and steer them to their contracted providers and particularly to health fund owned outlets.
This squeeze is occurring as health insurance fees rise. Many people are opting out of private health insurance and the industry is trying to make their policies more viable by giving a perceived higher return.
Private health insurance policies have consistently kept low rebates for Optometry. Some policies offer a fixed benefit whilst others offer a percentage rebate but both are subject to an upper yearly limit which has not increased substantially in the past 15 years. Whilst the annual limits have helped drive insured customers into outlets more frequently than the old 3-4 year cycle, they have also helped drive down the average spend on eyewear.
The Health Insurers assert that consumers have private health insurance so they should have the health care provider of their choice. The problem independent practices have is that consumers are not totally informed that they may receive a lower rebate under their policy if that provider is not a contracted provider of the health insurer. Even when an independent practice is a contracted provider there are instances where the health fund dictates the price that can be offered if the customer is claiming the item under a health insurance policy. The dental industry has made submissions to the ACCC about this practice but it seems the ACCC only care about the cost to the consumer and not their choice of provider or freedom to select from the whole gamut of available product.
In saying that, not all Health Insurers have contracted providers, but we don’t believe that two policyholders with the same Insurer, same policies, same premium, having the same optical services, do not receive the same rebate due to their choice of provider. This is where it becomes discriminatory and affects independents ability to compete.
Optometrists are happy to compete on price as well as the quality of service and care. However, flexible rebate practices do not provide a level playing field.