Annual premium charade continues

MEDIA reports that Federal Health Minister Mark Butler has asked health insurers to revise their premium asks for 2025 is a show we've seen repeated time and time again. The 12.3 million Australians with private hospital cover will take little comfort from the latest episode.

"We see this pantomime play out annually. Health insurers put up initial ambit claims, the Minister tells them to 'sharpen their pencils'. He said exactly that same thing in February 2024," APHA CEO Brett Heffernan explained.

"The Minister makes a show of pushing back, while the insurance companies get what they expected in the first place. It's a charade. The problem is under the Minister's tenure the premiums paid by Aussie mums and dads have risen year-on-year and the gap between the cost of hospital care and what the insurers cough up has widened exponentially. (See table below).

"The shortfall in funding to private hospitals, who actually provide care, has been over $3 billion on the Albanese Government's watch. At the same time, the insurance companies have banked unprecedented profits of over $5 billion. The result of this market failure under Mr Butler has been 20 hospitals close their doors entirely, 70 services in other private hospitals close, consumer choice eroded, investment in quality compromised and a blowout in public hospitals waiting lists.

"Last year the average premium increase was 3%. With that the health insurance companies pocketed $1.8 billion in profits – their second highest return ever, beaten only by 2023's windfall of $2.2 billion. It's not hard to make record profits when you can get away without paying your bills courtesy of government inaction.

"The Minister, who approves health premiums hikes every year, has a duty to ensure that as a result of his decision consumers are not ripped off and hospitals are paid for the treatments they provide. The Minister has failed on both counts.

"We are not asking the Federal Health Minister to do any more, or less, than his job. He has ignored these issues for two years, refused to make any decision at all on the growing hospital crisis in his portfolio, and then kicked-the-can on any decision until after the federal election. It simply isn't good enough. Not even close.

"With what is now a long-standing abrogation of responsibility, the Minister cannot possibly be surprised that he is being held to account."

The graph attached shows the underpayments from health insurers to private hospitals growing year-on-year under the Albanese Government.

-ENDS-

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