More than half of Australia’s health insurance policies contain exclusions for hospital treatments, according to a report from the Australian Competition and Consumer Commission.

The ACCC also warned that rewards schemes offered by some health insurers include the use of tracking apps to record physical activity and this information may in some cases be combined with other external data sources to profile consumers for targeted marketing.

The ACCC found more than 57 per cent of policies held by Australians contain exclusions, up from about 44 per cent in the previous year.

The report found that In 2018-19, consumers paid over $24.5 billion in private health insurance premiums, an increase of over $661 million or 2.8 per cent from 2017-18.

The amount of hospital benefits paid to consumers by health insurers was about $15.4 billion and the amount of extras treatment benefits paid was about$5.3 billion.

The number of hospital policies with an excess or co-payment continued to increase slightly from 84 per cent to 85 per cent.

ACCC deputy chair Delia Rickard said many people may not be aware they would not be covered at all for treatment as a private patient for those conditions.

“We’ve been working with private health insurers about how they can better communicate such detrimental policy changes to consumers.”

“Insurers need to make sure these changes are communicated clearly, prominently and in a timely manner, to avoid misleading consumers,” Rickard said.

The ACCC has also identified an emerging and potential risk of consumer harm from the collection and use of consumer data by health insurers and other businesses in the health sector.