Toowong Private Hospital to close from 11 June

Toowong — a 58-bed acute private psychiatric hospital, treating more than 3000 patients a year and employing 154 specialist staff — will close from 11 June, making it “the latest casualty of the insurer-induced viability crisis engulfing private hospitals across Australia” according to the Australian Private Hospitals Association (APHA).

“The federal government has been missing in action despite being fully briefed on the funding mess that has worsened over the last two-and-a-half years,” APHA CEO Bret Heffernan said. “Inexplicably, under Minister Butler the health insurance industry has been allowed to profiteer from premiums and undermine the healthcare needs of Australians.”

Renowned for its acute mental health care, APHA described the hospital as an exemplar in providing innovative approaches to the continuum of psychiatric care inside and outside the hospital setting. APHA added that the closure comes in the wake of health insurance companies pocketing an average $2 billion a year in record profits from people’s annual premiums, as well as $3.5 billion in ‘management fees’ — short-changing private hospitals by more than $1 billion a year, refusing to pay for the care of insured patients in full.

“The irony of a highly respected psychiatric hospital closing when the federal government says mental health is a priority should not be lost on anyone. It makes a mockery of such claims,” Heffernan said. “This announcement is bitterly disappointing for patients, staff, private psychiatrists and the management of Toowong because it was entirely avoidable. Many hospitals, including Toowong, took the unprecedented step of opening their books to the federal government over a year ago to demonstrate the failure of insurance companies to pay for the care of insured patients in full.”

Heffernan said the federal government “point-blank refused to act”, stating, “Its Private Hospital Viability Health Check, released last November, failed to produce so much as a thought bubble, let alone any willingness to act.”

Heffernan said that “Butler’s recent public commentary acknowledging the issues comes too little, too late for Toowong and many others.” He added that over the last few years 20 private hospitals have closed entirely, while more than 70 services in other private hospitals — notable maternity and mental health units — have been permanently cancelled.

“Make no mistake, Toowong’s closure is due to insurance company greed and the federal government’s failure to act to fix the failed, abuse-riddled funding model,” Heffernan said. “The human toll is very real. From today, the 3000 patients that Toowong treats each year will need to make other arrangements, while 154 dedicated specialist hospital staff will be looking for new jobs.”

Heffernan concluded, “Minister Butler must make good on his pledge to force the insurers to restore the traditional funding ratio to private hospitals of 88% from premiums, currently languishing at 83–84%. And he must do it now.”

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