Out-of-pocket costs for birth in private system 'shocking', midwifery expert says

Melissa Davey
Photograph: Yui Mok/PA

The out‐of‐pocket fees incurred by mothers with private health insurance are considerably higher than fees for mothers who give birth in public facilities, according to a new study – a finding that a leading midwifery researcher has described as “shocking”.

The study was led by Griffith University associate professor Emily Callander, who said until now very little was known about out‐of‐pocket expenses associated with maternity care in Australia.

Callander examined data including Medicare data, hospital data and pharmaceutical benefits scheme data from 186,789 women who gave birth in Queensland between 2012 and 2015. She also looked at the care received by their 189,909 resultant children following their use of health services, until they turned one.

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The women were separated into those who gave birth in the public or private system, and women were matched for similar birth circumstances, such as having a caesarean or giving birth vaginally.

“Fees were consistently higher in all time periods for private births compared with public births: 500% higher in pregnancy, 1,200% higher at the time of birth, and 180% higher in the first year postpartum,” the study, published in the journal Birth Issues in Perinatal Care, found.

“Obstetric services were the largest source of fees paid by mothers who gave birth in private hospitals ($1,296), followed by diagnostic imaging ($262) and specialists ($221). For each type of service, the fees for mothers who gave birth in private hospitals were higher than for similar mothers who gave birth in public hospitals.”

The study found women who gave birth in public hospitals saw general practitioners more often, while both groups of women used similar numbers of diagnostic imaging services.

“The standout finding is just how much more mums do pay if they do choose to give birth in a private hospital, and how long the out-of-pocket costs are incurred for,” Callander said.

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“It’s not just at the time of birth but those costs continue during the child’s first year of life. I found it surprising how many thousands of dollars mums who choose to give birth in private hospitals do pay. Private health insurance does not protect you from high out-of-pocket costs.”

She said these costs could be particularly distressing for parents without access to paid maternity leave. She said women may mistakenly believe that having top-level private health insurance would cover them for all procedures and services throughout pregnancy, when in fact it did not cover anything performed outside a private hospital, including diagnostic imaging and GP visits.

“Whether to take out private health insurance or not is a decision that’s 100% up to women,” Callander said. “But they need to be really aware of what private health insurance covers.”

She added that there was heavy government incentive for everybody to take out private health insurance through subsidised premiums, tax penalties for higher income earners without private insurance, and through penalising those who begin private health insurance coverage after the age of 31.

“The government also heavily subsidises the cost of that private system with our taxpayer money,” she said. “We need to be having a discussion about what we are getting out of it as a society. given how much public subsidisation occurs. And we also need to be asking: why do people shy away from what is a wonderful public health system in Australia?”

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A professor of midwifery in the school of nursing and midwifery at Western Sydney University, Hannah Dahlen, said she was “amazed” by the findings from the study.

“This study has been conducted with a huge amount of rigour,” Dahlen said.

“It’s quite shocking, and I didn’t realise the out-of-pocket costs were as bad as this study points out. Especially the cost of a caesarean in the private sector. I think a lot of women were led to believe that private health will cover everything.”

But she said people were increasingly dropping out of private health cover or never taking it up in the first place, particularly young women.

“A lot of women who give birth in the public system can’t believe the continuity of midwifery care they get. They get this amazing gold standard of care they don’t have to pay as much for as they would privately,” Dahlen said.

“Women aren’t stupid. They’re doing their research and marching with their feet away from the private system. This research helps to show us why.”