The financial viability of Australian private hospitals: a systematic review.

Abstract

Objective: This study aimed to synthesise Australian evidence on the determinants of private hospital financial viability and the implications for system performance.

Methods: We conducted a PRISMA-guided systematic review of English-language studies on Australia's mixed public-private system. Databases searched were PubMed, MEDLINE, Embase, Scopus, and EconLit. Eligible publications analysed financial, policy, or operational factors affecting private hospitals. Data were extracted and synthesised using thematic analysis. Twenty-three publications met the inclusion criteria.

Results: Five cross-cutting themes emerged. (1) Payment, pricing and fee transparency: fragmented schedules, out-of-pocket exposure, and contracting frictions weaken price signals and can erode margins. (2) Ownership, consolidation, and for-profit pressures: corporate and private-equity dynamics shape capital allocation, service mix, and bargaining power. (3) Insurance incentives and reforms: policy levers modestly influence demand and show limited impact on public waiting times, with mixed consequences for system efficiency. (4) Maternity, allied health, and pandemic disruptions: service lines with thin margins and workforce constraints are exposed to demand shocks and cost growth. (5) Consumer choice, emergency department usage, waiting times, and public-private overlaps: patient flows and portability influence revenue stability but create coordination challenges.

Conclusions: The sector remains valuable yet financially fragile. Improving price transparency, reforming payment models and contracting arrangements to better align with value-based principles, and deepening public-private partnerships could strengthen resilience. Targeted data on Aboriginal and Torres Strait Islander peoples health and clearer outcome-price linkages are priorities for practice and policy.