Private Hospitals in Australia

The Productivity Commission today released a research report which examines the structure and performance of Australia’s private hospital industry.

Private hospitals are an important part of Australia’s health care system. They provide 30 per cent of acute care hospital beds and treat 45 per cent of all surgical patients. Moreover, the private hospital industry has been undergoing some significant structural changes.

Amongst other things, this report:

• provides a statistical overview of the structure of the industry and the activities of the 500 acute care, psychiatric and day hospitals that operate within it;
• looks at some indicators of the industry’s financial performance, efficiency and quality of service (though it does not attempt to benchmark private hospitals against the public hospital system);
• discusses some of the key factors affecting performance, including the relationships between private hospitals, doctors and the health insurance funds; and
• draws attention to a number of policy issues germane to the industry’s future performance, including licensing arrangements for private hospitals and competitive neutrality, both within the industry and between private and public hospitals.

The report does not, however, include detailed policy analysis or contain policy recommendations.