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Rises in insurance premiums hinge on claims increase
2 May 2002
Private health funds may need to raise premiums again within 12 months if there is another increase in members' claims this year. While the Government approved an average 7 per cent rise in premiums recently across all funds, more cost pressures on the insurers are emerging and they are already looking at further increases. Funds can only lift premiums once a year, meaning that the earliest round of price increases would be March next year.
There was an influx of 3 million new health fund members in 2001 which led to increased profitability for the funds, but there were also more cost pressures. Pressures included members' heightened awareness of benefits, the take-up of no-gaps coverage, and pressure from private hospitals to get better contract rates from funds.
Sydney Morning Herald, 2/05/2002.
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