One of Australia’s largest private health insurers has paid back millions of dollars to thousands of members who had hospital claims incorrectly rejected.
Bupa has admitted to engaging in misleading or deceptive conduct and making false or misleading representations by advising members they were not entitled to private health insurance benefits when they were.
The ACCC said some Bupa customers financed their own medical treatments and were left thousands of dollars out of pocket while others upgraded to more expensive policies to ensure they were covered.
Some consumers also faced potential medical risks, complications, physical pain and distress after not proceeding with medical treatment or undergoing multiple treatments after being told they were not covered.
Bupa reached an agreement with the ACCC on a proposed penalty of $35 million for incorrectly assessing thousands of mixed-coverage claims over a five-year period.
This meant Bupa rejected entire claims in some cases where part of the claim should have been covered by a member’s policy.
The ACCC said this included cases where eligibility checks prior to procedures were incorrectly rejected by Bupa staff, as well as claims being automatically rejected after procedures were complete.
Bupa also admitted to engaging in unconscionable conduct relating to its assessment of 388 mixed-coverage claims due to automatic processing where a manual review was necessary to ensure benefits were accurately paid for claims.
In a statement, Bupa APAC chief executive Nick Stone said the issue should “never have happened” and the company was “deeply sorry for failing to get things right for our customers”.
“Our priority has been to communicate and compensate our affected health insurance customers and providers, along with putting in place measures to help ensure this does not happen again,”
Mr Stone said.
Bupa is Australia’s second-largest private health insurer and has more than 4 million members.
It has already started compensating affected members, medical providers and hospitals and has so far paid $14.3 million in relation to more than 4,100 affected claims.
ACCC chair Gina Cass-Gottlieb said the consumer watchdog had accepted Bupa’s undertaking to continue compensating affected parties.
“Bupa’s conduct … caused harm to consumers, some of whom delayed, cancelled or went without treatment for which they were, at least partially, covered under their health insurance policies,” Ms Cass-Gottlieb said.
Bupa said the errors occurred as a result of inaccurate or unclear instructions, training or guidance that meant Bupa did not always make correct assessments of claims and eligibility checks or act quickly enough to fix issues.
‘Private health insurers must do better’
Health Minister Mark Butler said the government supported the ACCC’s action against Bupa.
“Australians pay their hard-earned money to private health insurance providers and they deserve better,” he said on social media platform X.
“The $35 million penalty reflects Bupa deliberately misled and ripped off their customers.”
Any customers who believe they may have had a historical claim or eligibility check incorrectly assessed can visit www.bupa.com.au/mixedcoverage, or call Bupa on 134 135.
The Australian private health insurance industry’s peak representative body, Private Healthcare Australia, said Bupa needed to do “everything it can to resolve this matter”.
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