Health insurance regulator’s new eye on the market
Deloitte Federal Budget media releaseDOWNLOAD
Tuesday 8 May 2012: “To date there has been a lot of uncertainty about how consumers will react to the newly legislated means testing of health insurance tax rebates,” said Stuart Rodger, Partner and Health Actuary at Deloitte. “Government statements have consistently downplayed the impact, while the industry has expressed concern about the uncertainty.
“The Treasurer’s announcement at the Federal Budget to provide $500,000 funding for the Private Health Insurance regulator (PHIAC) to create a new Premiums and Competition Unit to analyse the industry’s product and marketing environment is welcome,” he said.
“This new unit will enhance PHIAC’s capacity to engage with the industry around products, pricing, competition and related issues. It is also intended to assist the government better understand cost drivers, competitive pressures and opportunities for savings under the rebate.
“The new unit should help the regulator keep an independent view on what is really happening as the new means test unfolds,” Rodger explained.
“At a time when the impact of means testing the health insurance rebate is still unknown, I am pleased to see this additional capability being introduced,” he said.
“The current process for the Minister for Health to approve or reject insurers’ price applications is inefficient and can still be unfair, despite improvement made in recent years. If the new unit improves the rigour and commerciality of this process, that will also be a welcome development,” he added.