Does Introducing Public Funding for Allied Health Psychotherapy Lead to Reductions in Private Insurance Claims? Lessons for Canada from the Australian Experience

Objective: Provincial and territorial governments are considering how best to improve access to psychotherapy from the current patchwork of programmes. To achieve the best value for money, new funding needs to reach a wider population rather than simply replacing services funded through insurance benefits. We considered lessons for Canada from the relative uptake of private insurance and public funding for allied health psychotherapy in Australia. Method: We analysed published administrative claims data from 2003–2004 to 2014–2015 on Australian privately insured psychologist services, publicly insured psychotherapy under the ‘Better Access’ initiative, and public grant funding for psychotherapy through the ‘Access to Allied Psychological Services’ programme. Utilisation was compared to the prevalence of mental disorders and treatment rates in the 2007 National Survey of Mental Health and Wellbeing. Results: The introduction of public funding for psychotherapy led to a 52.1% reduction in private insurance claims. Costs per session were more than double under private insurance and likely contributed to individuals with private coverage choosing to instead access public programmes. However, despite substantial community unmet need, we estimate just 0.4% of the population made private insurance claims in the 2006–2007 period. By contrast, from its introduction, growth in the utilisation of Better Access quickly dwarfed other programmes and led to significantly increased community access to treatment. Conclusions: Although insurance in Canada is sponsored by employers, psychology claims also appear surprisingly low, and unmet need similarly high. Careful consideration will be needed in designing publicly funded psychotherapy programmes to prepare for the high demand while minimizing reductions in private insurance claims.