News & Trends - Medical Technology

Private health insurance premium increase a timely reminder – AMA, MTAA

Health Industry Hub | April 9, 2021 |
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MedTech News: With private health insurance premiums rise of an average of 2.74% from 1 April 2021, the AMA is encouraging the Government to take immediate action on private health insurance reform and introduce a regulator to instil confidence into the system. 

“We know private health insurance is in trouble and unaffordable for many,” AMA President Dr Omar Khorshid said. 

“This private health insurance premium rise is a timely reminder for Government and private health insurers to focus their attention on ensuring Australians get the best deal possible. 

“Before the pandemic, private health insurance was already in trouble.   Membership has fallen continuously for nearly five years and remains unattainable for so many people. The other issue is younger people continue to drop their private health insurance, while those over 65 are taking it up in increasing numbers. This further jeopardises the stability of the system. 

“Younger Australians should be getting private health insurance but currently there’s no real incentive to do so. To bring young people back into the system we need to increase the value of their insurance while also decreasing pressure on premiums. The only way to do that is through focussed reform that puts the patient at the centre – not by just cutting costs, services or care. 

“That’s why we are calling for an independent regulator as part of a broader reform package – an independent ‘cop on the beat’ to protect consumers while we look at new models of care, increased value and lowered costs in the system,” Dr Khorshid said. 

The private health insurance sector has moved from primarily not-for-profit organisations to the current situation where almost 70% of the insured population are now covered by for-profit funds.  

“This shift to ‘for profit’ private health insurance funds mean the focus is changing from care to profit,” Dr Khorshid said. 

“There is now a genuine threat of Australia imitating the United States where insurance companies dictate what care patients can receive. We are seeing more and more signs that our health system is starting to slip the same way.  

“This is totally unacceptable. Now is the time for us to make deliberate, focused reform that ensures the hallmark of the private system – choice – is protected. We can and we must fix the system now,” he added.

Medical Technology Association of Australia CEO, Ian Burgess, said recently “It’s hard to fathom how insurers can increase premiums on Australians by more than six-times inflation, rake in mega-profits of 205.4% in the last quarter, and still claim they’re doing it tough.

“Enough is enough, it’s time for corporate health insurers and their lobbyist at PHA to stop playing politics and come to the table with MTAA and work through real and meaningful solutions to ensure Australians have access to the life-saving and life-changing medical devices, chosen by their surgeons and not insurers,” he commented.

Dr Khorshid noted “With all insurers offering different products, different levels of cover, and with different levels of premium increases starting tomorrow, now is also the time for Australians to shop around. The AMA’s Private Health Insurance Report Card can help consumers understand the complexity of the insurance sector.”

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