Record private health sign-up to beat wait – 7NEWS

Australians are signing up to private health insurance in record numbers to avoid hospital waiting lists.

Six consecutive quarters of membership growth has resulted in almost 55 per cent of the population – 14.12 million people – having some level of private cover.

Latest Australian Prudential Regulatory Authority data also shows the unprecedented increase is for both hospital and general treatment policies.

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Industry experts agree COVID has been the driver of the take-up and “appears to have lifted community interest in the need for protection”, according to a recent report by the consumer watchdog.

The Australian Competition and Consumer Commission (ACCC) believes “peace of mind” is the most common reason for buying private insurance, with policy numbers on the rise among most age groups.

However Private Healthcare Australian CEO Dr Rachel David says the growth is specifically to do with avoiding delays in essential non-emergency surgery and needs to be met with policy change.

“Improving affordability and access to private health insurance is the key addressing the current hospital crisis and ensuring Australians can access the healthcare they need,” she said.

“It’s now more critical than ever that the government implement promised reforms to improve affordability and keep pressure off premiums.”

Dr David says the cost of generic medical devices has been identified as the fastest growing area of claims expenditure and therefore the main cause of premium increases.

“Over the past two years, growth in benefits paid for medical devices (3.8 per cent) has exceeded growth in benefits paid for medical services (3.0 per cent),” she said.

“Under the government’s current pricing agreement with multinational medical device companies, patients are forced to pay 30-100 per cent more for the same medical devices compared to France, NZ and the UK.”

Dr David says it is time to restore the private fund rebate to 30 per cent for low and middle income families.

“Australian retirees and working mums with children are relying on their private health insurance for timely access to healthcare and to keep their families well,” she said.

“We have an obligation to do the right thing by them and introduce reforms to reduce costs wherever possible.”

Dr David says funds last year delivered the lowest average premium increase in 21 years (2.7 per cent), while many deferred it and are returning savings to members.

Despite the impact of the pandemic, they paid out almost $22 billion on behalf of members in the 12 months to December.

Even so, the ACCC says cumulative premium increases in the five years to June 2021 outpaced wage growth and average premium increases were more than double inflation during the same period.