18 August 2020

New figures show that the Government must urgently reconsider the private health insurance premium increases it has rubber-stamped for October.

Australian Prudential Regulation Authority statistics for April to June, released today, show that the proportion of Australians with hospital cover fell for the 20th consecutive quarter.

With premiums up 30 per cent under this Government and many Australians struggling to make ends meet during COVID-19, hospital coverage is now at the lowest level in 14 years.

The Private Health Insurance Act gives the Minister for Health the power to reject premium increases that would be contrary to the public interest.

Greg Hunt must now explain why another 2.92 per cent average increase in October would be in the public interest or cancel that increase altogether.

Another increase would compound the pain that many policyholders felt between April and June, when they were forced to pay for services they couldnt use. Todays figures show that benefits fell by more than 20 per cent compared to the March quarter, reflecting COVID-19s impact on elective surgeries and dental, optical and other visits.

Labor acknowledges that claims are expected to recover in subsequent quarters, and welcomes the steps some insurers have taken in response to COVID-19 particularly HBF, which has already cancelled its 2020 premium increase.

But with private health insurance already in crisis, and affordability and value further undermined by the pandemic and recession, additional premium relief and comprehensive reform are needed urgently.

Todays figures follow yesterdays warning by the Australian Medical Association that the financial impacts of COVID-19 will result in even more young people giving up their insurance, increasing pressure on an already unstable system.

The AMA has called for the October Budget to include reforms to improve the affordability and value of private health insurance consistent with Labors longstanding calls for reform.

As a starting point, the Minister must reconsider Octobers premium increases as a matter of urgency.