Private hospital operator Macquarie may terminate contracts with Australian Health Services Alliance insurers, potentially forcing thousands of patients to seek treatment elsewhere.
Major private hospital operator Macquarie Hospital Group is set to terminate contracts with dozens of health funds in the Australian Health Services Alliance, leaving thousands of patients to find treatment elsewhere.
Macquarie includes several rehabilitation, surgery and mental health hospitals in Sydney and Melbourne including Delmar Private Hospital in Dee Why, The Sydney Private Hospital in Ashfield, Longueville Private Hospital and Eastern Suburbs Private Hospital in Randwick.
The contracts will end at midnight on 16 March 2026 unless an agreement is reached before then. It could potentially affect hundreds of thousands of people who are covered under health insurers, including HBF, Doctors Health by Avant, Emergency Services Health and Nurses Midwives Health.
According to CEO David Wenkart Macquarie was left with no viable alternative after it said AHSA repeatedly refused to recognise the substantial cost increases facing Macquarie hospitals and the private hospital sector.
“Macquarie is doing everything possible to remain stable amid unprecedented cost escalation, workforce shortages and rising demand,” said Mr Wenkart.
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“Every other health fund has negotiated responsibly and collaboratively. Unfortunately, AHSA has adopted a hostile and rigid approach that is out of step with sector expectations.”
AHSA chief executive Andrew Sando said in the Australian Financial Review that AHSA had made Macquarie a “fair” offer.
“We made an offer that, we believe, is fair, but Macquarie rejected it and responded with a termination,” he said.
Mr Wenkert told Health Services Daily that they still hope to resolve the dispute. “Our position is we are well and truly to meet with AHSA to resolve the dispute. What we’d like to do is for AHSA to return to the negotiation table, act reasonably, responsibly and in the interests of members and patients,” he said.
Update: On Wednesday 28th January, Andrew Sando, CEO, AHSA, provided the following statement to HSD.
“AHSA is the largest buying group of private healthcare in Australia, helping not-for-profit insurers to provide the highest-quality service possible and patients to receive treatment when and where they need it.
“AHSA has successfully negotiated contracts with hundreds of private hospital operators, including the big hospital groups, across Australia and is firmly focused on ensuring value, access and quality outcomes for the 2.5 million people who are members of our funds.
“AHSA balances the needs of private hospitals with the impact on consumer premiums. This demands careful consideration of member affordability alongside hospital sustainability.
“AHSA is in ongoing discussions with Macquarie Hospital Services and will work to minimise any disruption to members.”