Hip replacements and your hip pocket: Some of the costs explained

If you need a hip replacement, you may have concerns about how much it will cost. Here’s our guide to some of the factors that may affect how much you pay for a hip replacement.

While a hip replacement may be an effective way for some patients to reduce pain and restore mobility, it can also be an expensive process. Whether you choose to go through the public or private system for your hip replacement, you’ll most likely end up with a number of out-of-pocket costs, which could be fairly significant.

What is a hip replacement?

Hip replacement surgery, also known as total hip arthroplasty, is a medical procedure in which either some or all of the bones comprising the hip joint are removed and replaced with either a metal or plastic prosthesis designed to mimic the natural function of the joint, Healthdirect Australia says.

Hip replacements are generally recommended for those with long-lasting hip pain that makes moving difficult and is having a significant impact on quality of life. A hip replacement can help to potentially alleviate this pain and subsequently improve one’s quality of life.

How much will a hip replacement cost me as a public patient?

The Medicare Benefits Schedule (MBS) lists a range of hip replacement procedures which Medicare will provide a 75% benefit for, ranging from a basic partial arthroplasty through to a total hip replacement requiring bone grafts (replacement or substitution of bone tissue) for both the pelvis and femur. The listed fees for these services range from $776.80 to $2,524.30, and the benefit provided ranges from $582.60 to $1,893.25. So if you choose to have your hip replacement carried out through the public system, you could incur an out-of-pocket cost between $194.20 and $631.05. Keep in mind, however, that surgeons and other medical practitioners are allowed to set and charge their own fees, which may end up exceeding the fee listed in the MBS.

While having your hip replaced through the public system could potentially see you pay less in out-of-pocket costs than going through the private system, waiting list times for procedures can be significant. Data from the Australian Institute of Health and Welfare showed that in the 2018-19 period, the median wait time nationally for orthopaedic surgery (the category hip operations fall into) was 77 days.

Conversely, undergoing a hip replacement as a private patient will generally involve a shorter wait, but a potentially larger out-of-pocket cost.

How much will a hip replacement cost me as a private patient?

If you choose to have your hip replacement carried out through the private system, data from the Medibank Surgical Variance Report 2017: Orthopaedic Surgery showed that the median out-of-pocket cost for a hip replacement was $141, but the average out-of-pocket fee charged by a surgeon was $2,054 across the two years to July 2016.

Do different surgeons charge different amounts for hip replacements?

The Medibank report found that the average total cost of a hip replacement ranged between $19,439 and $42,007 (with a median cost of  $26,350), and that some surgeons charged out-of-pocket costs as high as $5,567 for a hip replacement.

The report also found that just over a third of surgeons charged no out-of-pocket fees for orthopaedic operations, but that when it came to hip replacement surgeries specifically, 42% of patients paid an out-of-pocket cost for their surgeon.

Will my choice of health insurer affect my out-of-pocket costs?

Different health insurers may provide varying benefit levels and maximums for hip replacement surgery. For example, Bupa quotes an average procedure cost of $31,820 and an average out-of-pocket cost of $1,120, whereas HCF quotes an average total cost of $28,286 and an average out-of-pocket cost of $1,009. These average out-of-pocket costs do not include any excess the policyholder might need to pay and are based on the patient using a hospital within the insurers’ partner networks, so depending on your circumstances, your out-of-pocket costs may be different.

When it comes to what the out-of-pocket costs may be made up of, HCF gives the following example breakdown, based on the averages of eligible hip replacement claims it processed between 1 March 2019 to 29 February 2020:

• Orthopaedic surgeon: $359
• Anaesthetist: $423
• Assistant surgeon: $100
• Other clinician: $68
• Radiologist: $52
• Specialist consultations: $7

These average figures are just a guide and your total out-of-pocket costs and what they’re made up of will vary depending on your personal circumstances, including your health insurance policy and excess payable, the hospital you attend and the surgeon you choose to do your hip replacement. It may be worth speaking to your insurer or healthcare professional for more information.

Which state is the cheapest for hip replacement surgery?

The Medibank report calculated the average out-of-pocket costs customers were charged by surgeons in different states and territories for hip replacements. They were as follows:

• ACT – $2,591
• NSW – $2,673
• NT – $2,697
• Qld – $1,827
• SA – $556
• Tas – $681
• Vic – $1,997
• WA – $799

What tiers of health insurance cover hip replacements?

Joint replacements are only covered as a minimum requirement on Gold hospital policies, according to PrivateHealth.gov.au. However, this clinical category may also be included as an optional level of cover on Silver and Bronze policies. Where that is the case, the policy becomes a ‘Silver Plus’ or ‘Bronze Plus’ policy as the provider is offering cover beyond the minimum requirements of those tiers. Providers also have the option of including cover for joint replacements on their Basic hospital policies but on a restricted basis. According to PrivateHealth.gov.au, this means the policyholder would be partially covered for hospital costs as a private patient in a public hospital but may incur “significant expenses” in a private room or private hospital. It recommends checking with your insurer and hospital for details of what your policy will and will not cover.

Remember that while cover for joint replacements may be covered on a private health insurance hospital policy, excesses, cover limits, and maximum payable benefits may vary significantly by policy and product tier. It’s important to read the policy documents carefully and compare policies to help ensure you’re getting a level of cover that is suitable for your situation.

Compare Health Insurance

This article was co-written by James Hurwood.

Main image source: Denis Simonov (Shutterstock).