Economy

Yoga out, mental health in under sweeping reforms to private health insurance

Yoga out, mental health in under sweeping reforms to private health insurance”

"We'll be offering a discount of up to 10 per cent for people under 30", Federal Health Minister Greg Hunt told FIVEaa on Friday.

"The challenge now is to clearly define and describe the insurance products on offer so that families and individuals - many of whom are facing considerable cost of living and housing affordability pressures - have the confidence that their investment in private health delivers the cover they are promised and expect when they are sick or injured".

The government will also take natural remedies like homoeopathy and reflexology off the list of items covered.

Other changes include a greater focus on mental health services, increased investigative powers for the Private Health Insurance Ombudsman (PHIO) and tiered health insurance policy ratings: Gold, Silver, Bronze and Basic Bronze.

Australians under 30 will have their premiums cut by up to 10 per cent under federal government reforms.

But it's expected a cut to the price insurers must pay for some medical devices will drive the biggest reduction in premiums.

Hunt said an agreement with makers of hip and knee prostheses and cardiac devices would save insurers about $1 billion over the next four years.

Premiums have increased an average of 5.6 per cent a year since 2010, but Hunt wouldn't put a figure on how much that will fall.

'I'm working with the private health insurers. and they have guaranteed in writing they will pass through all of the cost savings'.

"A community rated health insurance system works best when you have broad participation across all age groups, not just older or less healthy people".

The changes will allow some people to increase their excess in exchange for lower premiums - up to $750 for singles and $1500 for families.

They will now be categorised into four levels of cover, Gold, Silver, Bronze and Basic, which is created to make it easier to work out which product is right for you.

"It's about information and simplicity; ensuring that all Australians are able to understand the impact of their policies, what they are covered for and what they aren't covered for", Mr Hunt said.

That discounted rate would remain until they are 40, after which it would be phased out. Aromatherapy, herbalism, kinesiology, shiatsu and tai chi are also reportedly on the list.

Labor's health spokeswoman Catherine King said young people will only save about 70 cents a week while older Australians won't see a dollar returned to their back pocket.

The ABC understands the Government has resisted pressure to dump low-priced policies, regarded as "junk" policies by some consumer groups, because of the flow-on cost it would have on other insurance premiums.

"Consumers in private hospitals have been paying wildly inflated prices for medical devices sometimes as much as five times what it costs in the public system for exactly the same device", he said.

On Thursday the Australian Medical Association president, Michael Gannon, told Radio National the reforms were "a start in the right direction" but would not solve the affordability problem of private healthcare.

The CEO of HCF, Sheena Jack, said the package was "good news for our members" and would help "make private health insurance fair and transparent for consumers".

"In an environment where the cost of healthcare continues to rise, reforms like this are paramount to addressing the issue of affordability".



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