Unnecessary procedures drive up private healthcare costs, competition inquiry finds
Over-servicing and ‘supply-induced demand’ are among the factors that the long-awaited report on the private healthcare market identifies
Over-servicing by doctors, specialists and other medical practitioners is one of the factors that have driven up private healthcare spending, the Competition Commission’s health market inquiry has found. This over-servicing includes increased admissions to hospitals, increased length of stay, higher levels of care, greater intensity of care, and the use of more expensive forms of care than necessary. The fee-for-service model of billing also stimulates oversupply, "which results in wasteful expenditure and incentivises practitioners to provide more services than needed. This incentive is intensified by the current unregulated pricing environment," the inquiry found. The provisional report of the inquiry into the constraints on competition in the private healthcare market was released on Thursday by chairman of the inquiry, former chief justice Sandile Ngcobo, after more than four years of work. The inquiry panel said it had found evidence of "supply-induced demand". Absolute age-adj...
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