Australia's Medical Device Price Fixing System
· news
The Unseen Heft of Australia’s Medical Device Price Fixing
Australia’s medical device market is a peculiar beast, where 14 million privately insured Australians pay some of the world’s highest prices for surgical hardware. At its core lies an obscure price-setting schedule called the Prescribed List, which dictates what private health funds must pay hospitals for over 10,000 items – from pacemakers and artificial joints to surgical staples, sponges, and glues.
This system has been in place since 2018, when then-health minister Greg Hunt made a deal that went against his own department’s advice. Despite warnings and reviews, the current government continues to enforce its terms with little improvement in sight. A review last year found that consumers still paid “significantly higher” prices than other countries.
Health economist Stephen Duckett notes that this system isolates medical device manufacturers from normal commercial competition. It is a “legalised transfer of wealth from Australians paying private health insurance premiums straight to multinational device companies.” This isn’t just about corporate profits; it’s also about who gets to decide what you pay for medical care.
The prices set by the Prescribed List are often far higher than those paid in public hospitals, and can be up to three times more expensive for privately insured Australians. In some cases, the difference is staggering – as much as 358 per cent higher than prices paid in New Zealand for identical products.
Critics describe this situation as a “legalised transfer of wealth from Australians paying private health insurance premiums straight to multinational device companies.” Despite warnings and reviews, the government remains committed to this system. When questioned about his 2018 deal, Hunt defended his record, citing extensive consultations with stakeholders and meetings with departmental officials throughout the reform process.
This situation reflects a broader pattern in Australian politics, where deals are made behind closed doors without transparency or accountability. The result is a system where corporate interests take precedence over public needs. As Duckett notes, “Neither party has shown the political will to fix it.”
The latest figures show that 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. This disparity highlights what this situation means for Australia’s healthcare system as a whole.
The future of Australia’s medical device price-fixing system remains uncertain. Will we see any real change, or will this situation continue to perpetuate itself? The answer lies not just in government policies but also in how Australians value their healthcare and demand greater transparency from policymakers.
Reader Views
- CSCorrespondent S. Tan · field correspondent
The Prescribed List is a textbook example of how Australia's health policy can perpetuate inefficiencies and inequality. The price-fixing mechanism creates a perverse incentive for private hospitals to inflate costs, knowing that health funds will foot the bill. What gets lost in this debate is the human impact on those who can't afford these exorbitant prices – often individuals with chronic conditions or those from lower socioeconomic backgrounds. We need to scrutinize not just the system but also how it disproportionately affects the most vulnerable Australians.
- EKEditor K. Wells · editor
The Prescribed List's opacity is just one symptom of a deeper issue: Australia's failure to establish transparent price controls for medical devices. While critics focus on the unfair pricing, we're neglecting the systemic consequences. By shielding manufacturers from competition, the government inadvertently encourages companies to hike prices, knowing consumers will absorb the cost. It's time to rethink this system and consider a more open market approach, where innovation and efficiency drive down costs – not merely corporate profits.
- CMColumnist M. Reid · opinion columnist
The Prescribed List's opaque price-setting mechanism is a masterclass in regulatory capture. While critics decry the financial burden on Australians, we'd do well to examine the role of health funds themselves. By negotiating prices with hospitals and device manufacturers under the Prescribed List, private health funds perpetuate the very system they're supposed to be influencing. A more transparent approach would see them actively pushing for lower prices or even exploring alternative procurement methods. Until then, we'll continue to funnel billions into the pockets of multinational corporations while our public healthcare system is left to pick up the tab.