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Secret payments boost coffers

When Nola Droop suffered a bout of breathlessness in 2016, she had no idea it meant her heart was failing, ABC News reports.

The grandmother was in good health and had no other signs of illness, so her doctor’s diagnosis shocked her.

“He said that I had no hope, no chance of living,” the 78-year-old said.

“He just said, ‘I recommend a pacemaker’. There was no talk about options at all.”

When she woke up in a private hospital she had a state-of-the-art pacemaker in her chest. It was made by global device-manufacturing giant St Jude Medical, which is now owned by healthcare company Abbott.

The only cost to her and husband Ivan for her life-saving surgery was the $250 excess on their private health insurance.

The insurer footed the bill for the surgery and the device, which ran into the tens of thousands of dollars.

They were nothing but thankful.

But unbeknown to Nola, the piece of technology keeping her heart beating may have attracted a lucrative payment that’s been loosely termed a “rebate”.

Now an ABC investigation has found private hospitals and clinics are getting between 5 and 50 per cent of the value of the devices as rebate payments in cash, or in-kind, for using a particular company’s brand.

Under one agreement, a clinic attracted rebates of up to 50 per cent for purchases that added up to more than $3 million.

Legal experts and industry insiders say this payment is better described as a kickback, it could be costing the health system millions, inflating insurance premiums, and ultimately impacting on public-hospital patients.


Secret pacemaker payments boosting private hospital coffers but costing the health system (ABC News)


Nola Droop, aged 78, was nothing but thankful for the state-of-the-art pacemaker she received. (ABC News: Alison Branley)