Joanita Wibowo

Retirement Income

Calls mount for health insurers to suspend April price hikes

Calls mount for health insurers to suspend April price hikes

Calls have mounted for private health insurers to cancel premium increases scheduled for April 1 amidst economic pressure from the new coronavirus pandemic.

Consumer advocate CHOICE said health funds should relieve customers from more financial burden by freezing the increases.

The demand came as non-urgent elective surgeries such as hip replacements and cataract surgery were postponed indefinitely by the government.

“If people can’t use the normal services that would allow them to claim on their private health insurance, then insurers’ costs will be going down,” said CHOICE CEO Alan Kirkland.

He said health fund premiums have gone up by 61 per cent over the past decade. “Their justification is that the amount they pay out to cover your treatment is going up. But that doesn’t hold up this year. We don’t think people should be paying full price when they won't be able to access a full service,” he said.

“There is no way they can justify increasing premiums in this context. Health funds should scrap their April 1 premium increases.”

The first fund in Australia to commit to axe premium rises is Perth-based HBF, which was due to implement a 1.98 per cent increase.

HBF’s CEO John Van Der Wielen said many of its one million members were affected by “extraordinary” financial circumstances.

“Now more than ever access to the best healthcare is more important than ever,” he said. “We want to do everything we can to keep health insurance affordable for our members.”

Other major health funds are yet to follow suit in cancelling the premium increases. The average increase across the industry this year is 2.92 per cent.

Medibank and AHM announced a support package of more than $50 million on Thursday, allowing customers to suspend their policy or access reliefs on their premiums. Members would also receive benefits for coronavirus-related chest, heart, lung and kidney hospital admissions.

Bupa also announced an assistance package of more than $50 million to help customers experiencing financial hardship due to the pandemic. The insurer also confirmed all members with any hospital policy would be covered for COVID-19 related claims.

GMHBA and HCF have also introduced financial hardship measures, encouraging customers who are struggling to pay premiums to reach out to discuss their options.