The Australian Competition and Consumer Commission has granted conditional authorisation to allow prospective members of the Private Hospital Collective Bargaining Group to bargain collectively with suppliers and health funds.
The condition limits the size of the bargaining group nationally and also its concentration in each state. It would also allow the hospitals to share certain information for benchmarking purposes.
The ACCC considers that the condition addresses potential concerns about the size that the group may reach, while allowing it sufficient scope to obtain economies of scale.
"The ACCC considers that the collective bargaining is likely to result in cost savings and provide small private hospitals greater input into their contracts," ACCC chairman Rod Sims said.
"Group members will also share information about processes and procedures relating to their operations and patient care. Performance benchmarking has the potential to improve the management or efficiency of participating private hospitals."
The PHCBG is newly formed and does not yet have any members, but several hospitals have expressed an interest in joining the PHCBG and the ACCC considers that the benefits are likely to occur once the PHCBG is established.
The proposed five year authorisation would provide prospective members of the PHCBG, private hospitals and groups of private hospitals with up to 200 beds, statutory protection to negotiate as a collective with health funds and medical and nonmedical suppliers. The authorisation would also protect the PHCBG for sharing information about processes and procedures for the purpose of benchmarking.
Authorisation does not represent ACCC endorsement of a group or scheme. Rather, it provides statutory protection from court action for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act 2010. Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.
More information about the application for authorisation, including a copy of the ACCC's final determination, will be available on the ACCC website at www.accc.gov.au/AuthorisationsRegister.