Dentists say the influence of the private health industry has led to a two-tiered system in their sector and they oppose extending insurance to GP clinics.

The Australian Dental Association (ADA) gave evidence in Sydney at a Senate committee hearing on proposed new laws to exclude insurers from family medicine.

Greens Senator Richard Di Natale has proposed changes to laws in response to a Medibank Private trial in south-east Queensland where insured patients receive preferential treatment.

The trial is operating at 26 clinics and includes priority appointments for patients, after-hour services, and bulk billing.

Senator Di Natale wants to outlaw insurers having any relationships with private practice.

ADA chief executive Robert Boyd-Boland told the committee that private health insurers had long been involved with the dental sector and anti-competitive practices were common.

He said these practices included:

Refusing some dentists' requests to become "preferred providers" in areas where they were oversubscribed

Refusing some dentists' requests to become "preferred providers" in areas where they were oversubscribed Insurers using other products to subsidise their own "no-gap" dental clinics to sink competitors

Insurers using other products to subsidise their own "no-gap" dental clinics to sink competitors Refusing rebates for arbitrary and incorrect reasons

Refusing rebates for arbitrary and incorrect reasons Acting as a "de facto dental board" by removing dentists from their preferred providers list if the company disagreed with their practices.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Watch Duration: 7 minutes 14 seconds 7 m Two-tiered system warning over private health GPs

"The Australian Dental Association receives complaints almost daily from dentists and patients upset that rebate levels vary depending on whether the dentist has a relationship with an insurer," Mr Boyd-Boland said.

"It's resulted in a two-tiered system."

Mr Boyd-Boland likened the situation to bookies owning the track, the horses, the jockeys, the rules, setting the odds and paying the dividends.

He said the association had complained to the Australian Competition and Consumer Commission (ACCC) to no avail.

"Our experience with private health insurers is that, without better regulation by government, private health insurers are significantly impacting on the delivery of optimal patient dental care in Australia," he said.

"Clearly private health insurers are focused on providing greater return for their shareholders than on the health of their policy holders.

"We feel that’s unconscionable behaviour, in particular with the premium being paid to the insurer, in part, being subsidised by the Federal Government. We feel government have been remiss in not keeping a check on this."

Insurer says it wants to prevent expensive hospital stays

Medibank Private defended its Queensland trial to the committee, saying health care costs were skyrocketing and it wanted to prevent patients needing expensive hospital stays.

Company representatives said the proposed changes to laws could impact 300,000 overseas students and visitors who were not covered by Medicare and whose visa required them to have health insurance for GP visits.

Corporate affairs manager Dan O'Brien said Medibank Private had no plans to seek to cover out-of-pocket costs at the GP office.

"GPs are the most efficient part of the healthcare system," Mr O'Brien said.

"Keeping people out of hospital is the most important aspect of making health care affordable."

Mr O'Brien said the company's move into GP cover was not about competitive advantage ahead of its public float.

"It has absolutely nothing to do with pending ownership changes," he said.

Mr O'Brien said the next stage of the company's trial would involve chronic disease management.

ACOSS concerned trial is move towards US-style system

The Australian Council of Social Services (ACOSS) told the committee it was concerned the Medibank trial was a move towards a United States–style health system.

The council's Rebecca Vassarotti said overseas experience suggested insurers who were involved in primary care pushed up appointment costs for everybody.

"It's particularly important that primary health services are universally accessible and affordable regardless of an individual's capacity to pay," she said.

The Australian Medical Association (AMA) also voiced concerns about the trial and gave evidence to the committee.

AMA president Professor Brian Owler said the association felt Medibank Private had been trying to use a "back door" to get into general practice.

This would ultimately lead to "managed care" where insurers influenced who patients saw and used incentives to manipulate the way doctors treated patients.

"Our concern is looking towards the future, how this plays out with more insurers," he said.

"Anyone who thinks managed care is not the end game needs to open their eyes. That’s clearly the end game."

However he said the association was open in the future to discussions on including insurers in chronic disease management.

Do you know more? investigatons@abc.net.au