Health insurance premiums
Nicola Roxon
posted Tuesday, 23 February 2010
Private health insurance premiums will increase by an average of 5.78 per cent from 1 April 2010.
This year’s increase is lower than last year (6.02 per cent), lower than industry expectations and it is significantly less than the last five years of the Coalition Government where the average increase was 6.63 per cent.
The benefits paid to private health insurance members increased by 9.3 per cent to $11 billion in 2008-09, while the consumer price index for hospital and medical services in 2009 was 5.9 per cent. Benefits paid are forecast to further increase by 7.94 per cent for the 12 months ending 31 March 2011.
And the Government is publishing the individual average premium increases to give consumers further choice and information. The Rudd Government is providing this detail to assist consumers to be more informed and empowered about their private health insurance.
This means that people are able to check and compare the average price rise for their fund, and to compare the relative costs and benefits of their cover. This is available at www.health.gov.au
The Government has assessed private health insurance premium applications to ensure that increases are the minimum necessary to meet legal requirements such as maintaining the solvency of insurers.
During the premium process I required resubmission from more than half the health funds, and as a result the premium increases for 8.5 million Australians have been reduced.
Shadow Treasurer Joe Hockey said last week that “The problem with the market is that ultimately premium increases are the decision of a Minister, so it’s not a pure market.” Australians can therefore be assured that under the Liberals private health premiums would now be even higher.
Premium increases for policyholders will vary across individual insurers, depending on their policy type. Insurers will contact members, as necessary, to notify them of a change in their premiums.
Consumers will shortly also be able to compare the coverage and costs of individual insurance products with the new premium information at www.privatehealth.gov.au.
Under the Rudd Government an additional 474,000 people since December 2007 are now insured with private hospital cover. 44.7% of Australians have private hospital cover, the highest coverage level since December 2001.