Federal government announces private health insurance reforms

Personal choice: More than 13 million Australians have private health cover.
Personal choice: More than 13 million Australians have private health cover.

Changes are on the way in a bid to make private health insurance simpler and more affordable.

A major shake-up of private health insurance also aims to make it easier to access mental health services and encourage younger people to take out private health cover.

Cowper MP Luke Hartsuyker said every dollar mattered to families on the Mid-North Coast and these reforms would get better value for families and make policies easier to understand.

“Private health insurance is an essential and valuable part of Australia’s health system,” Mr Hartsuyker said.

“We are encouraging younger Australians to take up private health insurance by allowing insurers to discount hospital insurance premiums for 18 to 29-year-olds by up to 10 per cent.”

The discount will phase out after people turn 40.

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Mr Hartsuyker said people with hospital insurance that did not offer full cover for mental health treatment would be able to upgrade their cover and access mental health services without a waiting period on a once-off basis. 

He said insurers would be able to offer travel and accommodation benefits for people in regional and rural areas that needed to travel for treatment. 

“This will be of significant benefit to people in Cowper,” Mr Hartsuyker said.

The maximum excess consumers can choose under their health insurance policies will be increased for the first time since 2001.

This will allow consumers to reduce their premium increase in 2019.

But not everyone is happy with the reforms.

The Australian Natural Therapists Association (ANTA) is critical of a decision to axe cover for a range of natural therapies such as yoga, pilates and homeopathy.

The association believes the Health Minister’s announcement will not deliver any perceived savings and will disadvantage those who access natural therapies healthcare through private healthcare cover, resulting in an overall increase in health care for all Australians. 

ANTA is in the process of setting up an online petition opposing the changes.

Meanwhile, Private Healthcare Australia chief executive Dr Rachel David said health funds recognised that complexities had developed in the sector over time and had been committed to working with government and stakeholders through the reform process to improve the customer experience.

Dr David said 84 per cent of Australians with private health insurance valued the product and wanted to keep it, however their main concern was affordability.

“There are 13.5 million Australians with private health insurance and almost half of them have an annual income of less than $50,000,” she said.

“The measures announced by the government with cooperation from industry and other stakeholders will go a long way towards addressing consumer concerns.”​


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