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Weeks before the 2022 federal election, a deal made inside then-health minister Greg Hunt\u2019s office locked 14 million privately insured Australians into paying some of the highest prices in the world for surgical hardware.<\/p>\n
Federal bureaucrats later told Hunt\u2019s successor, Mark Butler, that the deal went against their advice because it \u201cpredominantly benefited industry rather than providing a negotiated balance of benefits to industry and the Australian community\u201d.<\/p>\n
Related Article Instead of dismantling the agreement, though, Butler endorsed it \u2013 and instructed his department to enforce its terms.<\/p>\n Four years later, it remains the foundation of Australia\u2019s medical devices market. Last year, a review told the government that, although the system had improved in some ways, consumers still paid \u201csignificantly higher\u201d prices than other countries.<\/p>\n The agreement underpinned a little-known price-setting schedule called the Prescribed List<\/a>.<\/p>\n The Prescribed List<\/a> dictates what private health funds must pay hospitals for more than 10,000 items \u2013 from pacemakers and artificial joints to surgical staples, sponges and glues.<\/p>\n These prices are often far higher than rates paid in Australia\u2019s public hospitals, and mean privately insured Australians pay up to three times more for surgical hardware than overseas patients. In turn, critics say, the prices push up premiums.<\/p>\n \u201cWe have a system where the government mandates a price floor for private patients that is far higher than what public hospitals pay for the exact same products,\u201d said Stephen Duckett<\/a>, a health economist and former head of the federal health department.<\/p>\n Related Article The current system isolates medical device manufacturers<\/a> from normal commercial competition, forcing policyholders to subsidise corporate profits, Duckett said.<\/p>\n \u201cIt is a legalised transfer of wealth from Australians paying private health insurance premiums straight to multinational device companies<\/a>. And neither party has shown the political will to fix it,\u201d he said.<\/p>\n Hunt stands by the deal he made and said Labor, before the 2022 election, also supported the agreement and that its guiding principle had been to put downward pressure on insurance premiums. He also defended the consultation undertaken before his decision.<\/p>\n A federal government review of the agreement last year found that that while it was correct that prices for medical devices had fallen after Hunt\u2019s deal, total outlays stayed high, partly because hospitals used more devices per procedure.<\/p>\n<\/p>\n Official evaluation data reveals severe price gaps between Australia and health systems in New Zealand, Britain and France across many medical devices, including defibrillators, artificial joints and pacemakers.<\/p>\n Related Article Departmental briefs from 2022 to 2024 obtained under freedom of information (FOI) reveal the scale of local price hikes for a variety of devices.<\/p>\n For the most popular implanted cardiac defibrillator, the private Prescribed List benefit insurance companies had to pay in 2023 was $36,500. Public hospitals paid $14,500 for an identical device.<\/p>\n When setting prices for prescription medicines on the Pharmaceutical Benefits Scheme<\/a>, Commonwealth bureaucrats negotiate directly with pharmaceutical firms to secure the lowest cost for taxpayers. But for medical devices, the list dictates prices through an advisory committee that reviews the figures three times a year.<\/p>\n In 2022, when medical technology firms were worried about a potential shake-up of the Prescribed List, Hunt built in a mandatory price floor for devices on the list, at 7 per cent above what public hospitals pay.<\/p>\n<\/p>\n A Department of Health spokesman confirmed that the margin of 7 per cent above what public hospitals pay for devices remains in place.<\/p>\n Internal Department of Health documents show public servants formally refused to endorse Hunt\u2019s agreement in 2022.<\/p>\n In March 2022, days before Hunt signed the agreement with the lobby group representing the device industry, the Medical Technology Association of Australia, a senior bureaucrat advised Hunt\u2019s office that the department recommended the minister not sign the deal. The official warned of unmitigated financial risks and uncosted concessions.<\/p>\n Once Labor took office, the same bureaucrats told the new government that the deal Hunt\u2019s office agreed to \u201cwas not drafted or negotiated by the department\u201d and \u201cpredominantly benefited industry rather than providing a negotiated balance of benefits\u201d.<\/p>\n Private Healthcare Australia chief executive Dr Rachel David<\/a> said the Prescribed List locked in prices for medical devices in the private system that were consistently 7 to 20 per cent higher than public prices.<\/p>\n In some cases, the difference was far greater. David\u2019s association provided this masthead with six examples of devices that were up to 358 per cent higher than prices paid in New Zealand for an identical product.<\/p>\n David said the Prescribed List agreement transferred hundreds of millions of dollars directly from health insurance policyholders to bolster the profit of private hospitals and device manufacturers.<\/p>\n \u201cPrices have been too high for too long and international medical device companies have profited at the expense of Australian consumers,\u201d she said.<\/p>\n Related The latest figures from the Australian Prudential Regulation Authority show private health funds paid $2.52 billion for medical devices in the year to March 2026, a 3.2 per cent increase on the previous year. Over the same period, private hospital admissions grew at just 1.8 per cent.<\/p>\n Responding to the warnings disclosed in the FOI documents, Hunt last week defended his record, and said that he and his office conducted extensive consultations with stakeholders and held numerous meetings with departmental officials throughout the reform process.<\/p>\n Hunt<\/a> said a dedicated departmental taskforce led discussions with industry, hospitals and insurers to ensure patient access to breakthrough technology was maintained while still securing structural savings.<\/p>\n He also noted that Labor supported the deal after taking office.<\/p>\n A spokeswoman for Butler<\/a> said the government had reduced device costs while working to maintain private health affordability and consumer access to new medical technology. She said the Labor government had inherited a Prescribed List agreement from the former government that was riddled with stakeholder disagreement.<\/p>\n<\/p>\n![\"The](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/08\/69de9247d63571243f290c5989a1334226ef68e558ab6f89a01942e279ca224b.jpeg\")
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Greg Hunt as health minister in 2022.Alex Ellinghausen<\/p>\n![\"Medical](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/08\/6dfe63b00b6dd9883854d0186f4bad0e453df1ffe9bee9fac84125f8939df454.png\")
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Health Minister Mark Butler last month.Dominic Lorrimer<\/p>\n