In a report tabled in the Senate, the Australian Competition and Consumer Commission noted that insurers had paid around $500 million less in benefits last financial year.
“While insurers have acknowledged that COVID-19 restrictions reduced their ability to fund hospital and extras treatments, they have publicly committed to returning any profits gained from the pandemic to their policyholders and claim to have already returned substantial sums since the pandemic began,” the report states.
“In particular through hardship measures (for example, premium waivers or policy suspensions to policyholders financially impacted by COVID-19) and through postponing the April 2020 premium increase for at least six months — or cancelling it altogether.”
However, the ACCC appeared sceptical of an industry claim that any remaining savings would be spent to address the backlog of patients, saying “it remains somewhat unclear how long it will take private hospitals to clear their own build-up of private patient episodes”.
The ACCC suggested Federal Health Minister Greg Hunt look into the issue over the coming months, in deciding whether premiums should rise on April 1 next year.
“In addition, the ACCC expects insurers to act on the public commitments to return profits gained from COVID-19 restrictions to policyholders, including through the provision of hardship measures and the timely discharge of any accumulated demand for non-urgent elective surgery,” the report states.
“In preparing the next report to the Senate for the 2020–21 reporting period, the ACCC will consider the actions taken by insurers in this regard.”Jump to next article