Despite rising cost of living pressures, younger, healthier people are increasingly taking out private health insurance, a report published has found, in a trend one health policy expert described as "not rational".
The report also found a variation of up to A$700 (US$467) in rebates paid to patients of different funds undergoing the same procedure performed by the same doctor in the same hospital.
Prior to the pandemic the proportion of people with insurance for hospital treatment was plummeting thanks to confusing policies that offered little value for money. Young people especially were opting out of private cover.
But the Australian Medical Association (AMA) Private Health Insurance Report Card for 2022 found a continued two-year upward trend in membership, with the proportion of people with hospital insurance rising from 43.6% in June 2020 to 45.2% by June 2022.
The report also found private health insurer profits have never been higher despite a reduced demand for hospital treatment due to the cancellation of many elective surgeries during the pandemic.
The findings prompted the President of the AMA, Prof Steve Robson, to call on the insurers to provide better value for money to members.
“The fact that there are big differences in amounts paid for the same doctor performing the same procedure is frustrating for consumers,” Prof Robson said.
“This variation in out-of-pocket expenses is one of the reasons the AMA has called for an independent regulator – a private health system authority – to oversee private health insurance to ensure policyholders are getting fair value for money through a mandated minimum amount that every insurer is required to return to patient care.”
Mr Ian McAuley, a research fellow at the Centre for Policy Development who has undertaken extensive research into the private health insurance industry, said the report reflected the latest quarterly private health insurance statistics from the Australian Prudential Regulation Authority.