Media releases

February 16, 2005

Statement from George Savvides regarding hospital contracting framework

Medibank Private is undertaking a competitive tender process to address escalating healthcare costs and the resulting increase in premiums. This process is also about enshrining quality and safety benchmarks to look after our members.

When the tender process concludes in September, Medibank Private will continue to contract with over 90% of private hospitals.

We are surprised by the hospitals' reaction, as this is a normal commercial practice. Only those private hospitals that don't meet our quality and safety benchmarks, or charge too much, need to be concerned.

We expect to reduce the number of hospital beds our contracts cover by approximately 10%. We believe this will be less than a handful of hospitals nationally.

Our 3 million members will continue to have access to contracted hospitals in metropolitan areas.

The majority of our members currently travel, on average, less than 30 minutes to reach a Member's Choice Hospital - this won't change once the tender process is concluded as there are alternative private hospitals in all of the targeted areas with surplus capacity.

Hospitals have said themselves that they have excess capacity and this is supported by Australian Bureau of Statistics data that shows private hospitals run at an average of 75% occupancy.

Our priority is to offer value to members by seeking the best commercial arrangements that also ensure quality care for our members.


For further information, please contact:
Trish Hyde, Public Affairs Manager, Medibank Private
PH: 03) 8622 5181 / 0401 987 531

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