What the reform is about
The current Prescribed List benefit for CIEDs consists of 2 components, the:
- cost of the medical device
- cost of technical support services for the life of the device.
More work was required to determine the reasonable cost of providing the technical support services. Then the scheduled benefit reductions can be applied to reduce the gap between the Prescribed List benefit and the price paid in the public hospitals.
How we will achieve this
The scheduled benefit reductions for CIEDs were delayed until 1 July 2023. This was to provide the Medical Services Advisory Committee (MSAC) with enough time to estimate the cost of technical support services.
CIED benefits with a gap of more than 7% above the weighted average public price will be reduced by:
- 40% of the gap on 1 July 2023
- 20% of the gap on 1 July 2024
- 20% of the gap on 1 July 2025 (final reduction).
For full details, see the Memorandum of Understanding (MoU) with the Medical Technology Association of Australia (MTAA).
Timeline
We released a high-level summary of submissions to Consultation Paper 9. This was stage 1 of the consultation.
We are now planning stage 2, which will involve discussions with stakeholder groups.
Past activities
| Date | Activity |
|---|---|
| 12 July – 6 September 2024 | Sought stakeholders’ views on how to implement the MSAC advice and reduce benefits for technical support services, via Consultation paper 9 . This was stage 1 of the consultation. |
| 1 July 2024 | Second scheduled benefit reduction of 20% of the gap (device component only) |
| 19 April 2024 | Announced next steps for benefit reductions for CIED after MSAC advice. The proportion of the benefit corresponding to the device component was recalculated at 56.3%. |
| 16 April 2024 | The MSAC provided advice on the reasonable cost of technical support services for CIEDs |
| 1 July 2023 | First scheduled benefit reduction of 40% of the gap on 1 July 2023 (device component only). See the updated benefits. The device component of the CIED benefit was estimated at 54% of the current CIED benefit. We based this estimate on the information provided to the MSAC by the industry applicant. |
| 7 June 2023 | Published revised reduced CIED benefits (device component only) PHI 36/23 Revised benefit reductions for Cardiac Implantable Electronic Devices. |
| 16 May 2023 | Published reduced CIED benefits (device component only) effective 1 July 2023 PHI 29/23 Benefit reductions to Cardiac Implantable Electronic Devices. |
| January to February 2023 | We worked with the Medical Technology Association of Australia (MTAA) Cardiac Forum on an interim solution: reduce CIED benefits for the device component only, effective 1 July 2023. |