A study by consumer advocacy group Choice revealed that Australia’s insurance industry is dying, The Guardian reported. According to the Australian Healthcare Reform Alliance (AHCRA), the issue simply showed that the recent reforms in the insurance industry failed.
To put things into perspective, Australia’s insurance regulations were reformed in April to add “plus” versions of the then existing tiers namely gold (the highest), silver, bronze, and basic (the lowest) policies. This seeks to make choosing coverage policies less complicated and more understandable to consumers.
In its review of the private health insurance sector, Choice discovered that over 215 silver and silver plus coverages are more expensive than gold policies offered by other companies. The most expensive silver plus policy is from Frank (GMHBA) Health Insurance. According to Choice, this means that the reforms failed in its mission to make options simpler and more affordable.
Den Price, Choice’s health campaigner, said that the report only shows that the private health insurance sector is in a “death spiral” that is “self-imposed.” Moreover, he noted that the “investigation uncovers more reasons why people don’t trust the companies offering these policies.”
AHCRA Chairman Jennifer Doggett remarked that the report unveiled the failure of the reforms. In fact, she said that “consumers are clearly no better off than they were before these changes were introduced.” Consumers are also “still struggling to make sense of a poorly designed, inefficient and inequitable insurance system.”
Doggett added that the fragile consumer-insurer relationship is further aggravated by this failure.
Meanwhile, Stephen Duckett, a health economist from Grattan Institute, said that the original tiered system already served the purpose of simplifying policies. He added that the introduction of plus levels only made it more complicated.
Aside from Frank (GMHBA) Health Insurance, other key players in Australia’s market also appeared in the report. This includes BUPA, HBF, HCF, Medibank, and NIB.