For the first time in five years, Australians with private health insurance are poised to encounter a significant increase in their annual premiums, affecting around 15 million policyholders nationwide.
On Wednesday, private health insurers will present their proposed premium adjustments to Federal Health Minister Mark Butler for evaluation.
A recent analysis by Money.com.au indicates that next year’s premium hike is set to closely mirror the rate of health inflation, breaking a five-year trend.
Minister Butler has expressed his expectation for health funds to act in good faith when submitting their proposals. However, insurers are grappling with rising costs and challenges within the private hospital sector.
This year, health insurance premiums saw an average rise of 3.73 percent, following Butler’s rejection of earlier proposals from insurers that sought increases ranging from 5 to 6 percent.
The changes were announced in February after Butler twice knocked back insurers’ earlier proposals for steeper increases of between 5 per cent and 6 per cent.
In the lead-up to Wednesday’s submissions, Butler said he expected private health funds to make “more strenuous efforts” to offer value to customers and help struggling private hospitals.
His final decision – expected between December and late January – will determine how much more Australians will pay for private health cover when new premiums begin next April.
