Health funds' profits in the year to 1 April have increased to $1.3 billion.
Only months after the Government granted approval for yet another well above CPI increase in private health insurance premiums, health funds have declared profits of $1.3 billion in the year to 1 April (post-tax).
The latest insurance premium increases were introduced after strong lobbying from Private Healthcare Australia (PHA) focused on a ‘relentless upward curve of health inflation’.
"Profitability is good but the sector is also heavily scrutinised by APRA, ASIC and the ACCC. They have a lot of insight into data and reporting," said PHA chief executive Rachel David.
The YourLifeChoices Insights Survey 2017 reveals that for the first time, the number one concern for older Australians in retirement is their health, rather than their finances.
Australian Medical Association (AMA) President Dr Michael Gannon is one of the health industry leaders calling for serious questions to be asked about the insurance system, with profits ending up in the pockets of overseas shareholders.
"Australians are openly questioning the value of private health insurance, complaining about the out-of-pocket costs, increasing number of conditions, caveats, carve-outs and proliferation of junk policies," said Dr Gannon.
When questioned about the rising costs of health insurance and the profits being made by the health funds, Health Minister Greg Hunt said: "I know that every single dollar matters to Australian families and keeping private health insurance affordable is a priority. I want to work together with the states and territories to find a solution to take pressure off private health insurance premiums."
What do you think? Are the profits being made by the health funds obscene? Should profitability levels of health funds be capped to ensure an affordable service? Do you think the Government too readily agrees to the lobbying of the private health funds?
Read more at abc.net.au