Defence disputes AMA claims on Medibank Health Solutions

Right of Reply: By R.M. Walker, AM, Rear Admiral, RAN, Commander Joint Health, Department of Defence (Australia)

Dear Editor,

An article published in Government News, (October/November 2013, Vol.33, Issue 5), titled Battle Looms Over Defence Health Services, by Dr Steve Hambleton, President of the Australian Medical Association, contains misleading suggestions and incorrect statements about the level and quality of health services being delivered to Australian Defence Force (ADF) personnel under the Australian Government contract with Medibank Health Solutions (MHS). Defence is requesting an opportunity to publically correct these statements.

There is no higher priority for Defence than the health of ADF members and Defence continues to assure all servicemen and women that timely access to high quality care is the primary focus of the Defence Health Services.

MHS has been contracted by Defence as the prime provider of health resources purchased from the civilian community. Contrary to the statements contained in the article by Dr Hambleton, Defence Health Services retains responsibility for the overall management, approval and delivery of health services to ADF personnel. In contrast to Defence’s previous arrangements for purchasing health care, the Contract with MHS provides Defence very powerful mechanisms by which it maintains assurance of: the access to health services, the quality of health services, and the certainty of the cost of health services. All three of these objectives are important to Defence.

Defence maintains a very disciplined approach to monitoring and managing the performance of MHS under this contract. MHS has maintained strong performance against Key Performance Indicators in the delivery of its off-base services. As of 01 September 2013, the contract with MHS has successfully delivered more than 749,000 off-base services to ADF personnel. This includes: more than 447,000 services that were for specialists, allied health, hospital, rehabilitation and optical services; more than 240,000 pathology services; and more than 61,000 imaging and radiology services. No ADF member has not had access to an offbase specialist or other service that was clinically indicated.

Defence Health Services has placed a high priority on seeking feedback from ADF personnel on the health services being provided since the transition to the MHS contract. Contrary to the claims of Dr Hambleton, there is clear evidence that ADF personnel are more willing than ever before to submit both negative and positive feedback regarding the health services that they are receiving. This feedback has been instrumental in enabling Defence to work closely with MHS to adjust service delivery when required. Defence Health Services encourages a culture of reporting and feedback on its health services and continues to encourage feedback from all ADF members. Defence confirms that the overall complaint and incident rate related to off-base services under the contract as of 31 August 2013 is less than 0.001 per cent.

Defence Health Services closely monitors the waiting times for access by ADF personnel to all services it provides including to off-base specialists across the country. Defence can confirm that the current waiting times for access to these services are in the vast majority of locations the same and better than that being experienced by the civilian community. In that respect Defence is not immune to the national inequities that exist in the availability of some health services and it has always been the case that there are community shortages of some specialists in locations such as Darwin, Townsville, Canberra and the South Coast of NSW. Defence has been working closely with MHS to provide innovative solutions to improve access to some services in these areas through, for example, the provision of Fly-in/Fly-out services where clinically appropriate.

The comparisons that are drawn by Dr Hambleton regarding the numbers of providers available pre and post contract to ADF members is not valid. Defence did not previously maintain formal agreements with its specialist service providers except in a small number of specific cases.

The MHS Service Provider network continues to grow and as at 11 September 2013 more than 4100 specialists are formally contributing to this network. An important difference with previous arrangements is that Defence is now able, through MHS, to ensure that every Specialist that is used has unrestricted and unconditional registration on their practice. Previous arrangements did not provide for this level of quality assurance.

Defence is aware that during the transition of service MHS experienced some delays in payment of Service Provider invoices while the new system was being embedded and refined. All Service Providers have been repeatedly informed since the transition of the contract of the data requirements for invoicing under the new contract arrangements. These invoicing requirements are consistent with any other purchasing arrangement that exists in the health industry. MHS accepted a lack of compliance with the invoicing requirement until July 2013. This lack of compliance has been contributing to both Service Provider payment delays and an increased administrative burden within Defence. As of 01 August 2013, MHS has been rejecting non-compliant invoices in order to improve invoice processing times for compliant invoices. Defence has supported this approach. The rate of non-compliant invoices has decreased from 51 per cent in July to approximately 10 per cent in September and has dramatically improved provider payment times.

Defence refutes Dr Hambleton’s claims that there was a lack of consultation by Defence with the medical profession. Defence, in following the Government’s procurement guidelines, communicated its tendering intentions through Austender, which is the Commonwealth approved tendering system. A Request For Information (RFI) meeting was held on 22 February 2011. 49 individuals attended from approximately 30 related industry entities. Defence released an open Request for Tender (RFT) on 25 August 2011 for a suite of services. This RFT invited a broad range of responses from industry including the capacity for responses to be on a regional, national or service package basis. An industry briefing session was held on 06 September 2011. 115 individuals from 57 related industry entities attended this session. A Defence site visit was conducted on that day and 75 individuals attended this site visit. The RFT closed on 19 October 2011 and 19 tender responses were received.

There is no higher priority for Defence than the health of its members and, as per previous public statements, Defence assures all servicemen and women there will be no degradation in the level of care and services afforded to them through the MHS contract. The contract with MHS will continue to ensure ADF members receive the best health services available, in the most cost efficient way.

Yours sincerely,

R.M. Walker, AM
Rear Admiral, RAN
Commander Joint Health

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