Inflammatory APRA comments won't help private health insurance

Wednesday 5 February 2020

Inflammatory APRA comments won't help private health insurance
Inflammatory comments from the private health insurance regulator unnecessarily undermine public
confidence in the private health system and propose unworkable policy options that must be rejected, says
Australian Private Hospitals Association's (APHA) CEO Michael Roff.

Yesterday, the Australian Prudential Regulation Authority (APRA) Executive Board Member Geoff
Summerhayes announced only three health insurers could survive in the current market and called on the
Government to consider ending community rating – a key platform of private health insurance in Australia
and a differentiating factor from the undesirable and costly American system.

Mr Roff said his comments were 'ill-informed' and potentially dangerous.

"These comments have the potential to damage public confidence in the entire private health sector at a
time when the Government is trying to enhance the value of the private health offering through a process of
ongoing reform," Mr Roff said.

Furthermore, attempts to abolish community rating would result in massive price increases for older,
vulnerable Australians, effectively making health insurance unaffordable for the people who need it most.

This would lead to an increased burden on the already struggling public hospital system, increasing waiting
times and dissatisfaction with the public system.

Even more concerning is the apparent push by the regulator for health fund consolidation, which would
erode Australian's choice and value by reducing the diversity and competition that exists in the current
market.

"Far from a declining membership, as Mr Summerhayes claims, we understand smaller health funds have
been experiencing increased membership in general, including in younger age cohorts, at the expense of
the larger health funds. This would indicate consumers appreciate the choice and value provided by smaller
funds, something APRA wants to see removed.

"In addition, Mr Summerhayes comments indicate APRA would like to restrict health insurance coverage for
mental illness. This is a key area of Government reform, with the recent changes allowing an immediate
upgrade to private psychiatric care proving successful, providing access to mental health treatment for
thousands of Australians. We can't afford to go backwards on the provision of mental health care.

APHA continues to argue for practical policy reforms, including the restoration of the full health insurance
rebate for low-income earners and adjusting the levels of the Medicare Levy Surcharge to incentivise highincome earners to take up and maintain private health insurance.

-ENDSMedia contact: Frith Rayner, Director Communications and Marketing, 0413 971 999
The Australian Private Hospitals Association (APHA) is the peak industry body representing the private hospital and day surgery
sector. The private hospital sector treats 4.5 million patients a year, including treatment of a third of chemotherapy, 60 percent of all
surgery, 74 percent of all elective musculoskeletal surgery and 80 percent of rehabilitation.

Level 3 /11 National Circ, Barton ACT 2600. PO Box 4502, Kingston ACT 2604. [T] 02 6273 9000 [F] 02 6273 7000
[E] [W] www.apha.org.au [FB] ValuingPrivateHospitals [Twitter] @priv8hospitals
ABN 82 008 623 809

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