Trancript of 7:30 Report, ABC Television

With 60 hospitals across Australia, pathology labs and an array of technical services the company makes a formidable boast.

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BANNERMAN: But that caring image has taken a beating lately with the Australian Medical Association (AMA), claiming Mayne Health is selecting patients in its hospitals that will deliver the company maximum profit.

ZIMMET: Our major concern has been that our elderly patients with complex medical problems don't seem to be getting the hospital admissions that they actually need for their illness.

BANNERMAN: Such allegations are not entirely new. Two months ago, the 7:30 Report detailed a series of complaints concerning admission procedures at the Port Macquarie base hospital run by Mayne Health.

Now another case has come to light at that hospital that raises further questions about the way Mayne deals with potential patients.

DALZIEL: I don't know what the hospital is for.

It's for ill people, and I got a shock when she told me I had to take her home because she was too ill.

BANNERMAN: Jim Dalziel and his wife Eileen had been together for 60 years. Last October she tripped and fell in her home in Port Macquarie. Already suffering from dementia, she was deeply distressed. Acting on medical advice, her family called the ambulance to take her to the Port Macquarie Base Hospital, run by Mayne Health.

McMILLAN: The doctor who was in attendance was constantly referring to the surgeon, and they decided to operate, then discussed it again and decided she was much too frail to go under an operation. Then they decided to manoeuvre it back into place.

BANNERMAN: At this point, seeing Eileen on a drip inside the hospital, both Jim and his daughter Lyn felt hugely relieved. They were not prepared for what happened next.

McMILLAN: They asked what private health fund she was in and the answer was none.

BANNERMAN: So what happened then?

McMILLAN: Nothing. Absolutely nothing.

DALZIEL: They told us we had to take her home.

McMILLAN: Take her home.

BANNERMAN: It's important here to bear in mind that right up til this point, provided Eileen underwent surgery for her broken arm, a bed was available for her. So at the point you indicated that you weren't privately insured they basically said they didn't have a bed for your mother?

McMILLAN: Exactly, yes.

BANNERMAN: Did that shock you?

McMILLAN: Yes, it did. I thought it was absolutely appalling.

BANNERMAN: Lyn may have been appalled but she had little choice but to take her mother home. The NSW Health Commission, though, does have choice, and power. And it wants this case investigated.

REID: People in any base hospital in Australia are treated on the basis of their clinical need when they walk in the door - that's how they should be treated. They are not treated, in the first instance, about whether they hold or don't hold private health insurance.

BANNERMAN: But Eileen Dalziel's story does not end there. At home her condition worsened and, under doctors orders, she was once again taken back to the hospital. There, her family was forced to play out a terrible deja vu.

DALZIEL: The woman attending, I thought was a doctor, and she came up to the bedside where my wife was lying. And I said, "What's going to happen?" And she said, "You've got to take her home.

"She can't stop here.

"She's too ill, she's not going to recover."

"We don't want people here that's going to die."

"Well," I said, "we're not taking her home."

BANNERMAN: Did that strike you as being very strange?

JIM DALZIEL: Yeah, well then she said, "We only want people here that can be made well so you've got to take her home."

I said, "We're not taking here home."

BANNERMAN: Eileen was admitted to the hospital and died less than a day later. Having heard the Dalziels' story, we approached Mayne for an interview. They refused but gave us this statement.

MAYNE STATEMENT: "All clinical decisions and actions are taken by medical staff and those decisions are made on the basis of medical needs."

"We have investigated this incident and Mayne Health believes staff acted appropriately."

BANNERMAN: Had we been able to do that interview there are several questions we wanted to ask. The first is why was the family told that if Eileen Dalziel was admitted for surgery there was a bed available, but that same bed was not available for palliative care?The second is important too. We wanted to ask, is the contract between Mayne and the State Government weighted to reward surgical procedures over long-term medical care? But if Mayne aren't talking, the NSW Health Commission was more open, conceding that under its agreement with Mayne Health there's little incentive to admit patients in need of palliative care. In the terms of the contract, someone like Eileen Dalziel is not a particularly profitable patient. That's right, isn't it?

REID: Difficult to judge. It could be the case that certain patients whose length of stay in the hospital far exceeds whatever the contract would pay would not be of a good economic return to the operator of Port Macquarie Base Hospital.

BANNERMAN: Michael Wooldridge is the Federal Minister for Health. This week, confronted with accusations that Mayne Health was being selective in its admissions to hospitals, he asked for evidence. We asked him for his reaction to this case but he refused. His spokesman simply said: "While it's an unfortunate situation, the Port Macquarie Base Hospital is being managed on behalf of the NSW Government and the state has responsibility and power to investigate the patient's death."

BANNERMAN: Meanwhile, in Victoria, accusations that Mayne Health is making selective admissions to its private hospitals continue.

ZIMMET: I would say that people are looking at trying to 'pick' the easier patients, the best patients, the patients with surgical options to put into their private hospitals.

BANNERMAN: Dr Alan Zimmit is the Federal Treasurer of the AMA. He is also an oncologist who works at Mayne Hospitals in Victoria. He claims he has no doubt that cherry-picking is going on and despite Mayne's denials, he says his organisation is determined to show how extensive it is.

ZIMMET: I think it will come to something I think the AMA in Victoria is going to do a major survey of its surgeons and physicians to try and get a real feel for how prevalent this is.

BANNERMAN: Mind you, whatever happens, it will come too late for many older Australians, including Eileen Dalziel, who, it seems, are now slipping through the cracks of our health care system.

Ends