Increase in Caesarean Deliveries after the Australian Private Health Insurance Incentive Policy Reforms

Background: The Australian Private Health Insurance Incentive (PHII) policy reforms implemented in 1997-2000 increased PHI membership in Australia by 50%. Given the higher rate of obstetric interventions in privately insured patients, the reforms may have led to an increase in surgical deliveries and deliveries with longer hospital stays. We aimed to investigate the effect of the PHII policy introduction on birth characteristics in Western Australia (WA). Methods and Findings: All 230,276 birth admissions from January 1995 to March 2004 were identified from administrative birth and hospital data-systems held by the WA Department of Health. Average quarterly birth rates after the PHII introduction were estimated and compared with expected rates had the reforms not occurred. Rate and percentage differences (including 95% confidence intervals) were estimated separately for public and private patients, by mode of delivery, and by length of stay in hospital following birth. The PHII policy introduction was associated with a 20% (-21.4 to -19.3) decrease in public birth rates, a 51% (45.1 to 56.4) increase in private birth rates, a 5% (-5.3 to -5.1) and 8% (-8.9 to -7.9) decrease in unassisted and assisted vaginal deliveries respectively, a 5% (-5.3 to -5.1) increase in caesarean sections with labour and 10% (8.0 to 11.7) increase in caesarean sections without labour. Similarly, birth rates where the infant stayed 0-3 days in hospital following birth decreased by 20% (-21.5 to -18.5), but rates of births with >3 days in hospital increased by 15% (12.2 to 17.1). Conclusions: Following the PHII policy implementation in Australia, births in privately insured patients, caesarean deliveries and births with longer infant hospital stays increased. The reforms may not have been beneficial for quality obstetric care in Australia or the burden of Australian hospitals.