Members Health has defended the importance of smaller private health insurers in response to a speech by APRA Member Geoff Summerhayes.
Speaking at a Members Health conference, Mr Summerhayes questioned the future sustainability of the sector, saying smaller insurers are particularly vulnerable.
He said the risk of this trend continuing is that only three private health insurers will still have a sustainable business model by 2022.
“Our funds have a compelling story to tell, and it’s a story that more and more Australians are coming to realise,” said Members Health CEO Matthew Koce.
“As a group, the Members Health funds are growing at nearly 3 per cent annually, while the rest of the industry is either stagnant or bordering on negative growth," he said.
“A Coles and Woolworths style duopoly or big-4 banks style market domination is the last thing consumers would want.
“When making important health-related decisions, consumers should be able to turn to a fund that puts members’ health before profit.
“Australians want a diverse and competitive market of health funds. They want an insurer that goes that extra mile – one that is for people, not for profits.”
“It’s no secret, the private health insurance industry is facing a declining trend of participation, particularly among younger age groups, but it is clearly not being experienced by the group of not-for-profit insurers in our alliance,” continued Mr Koce.
“In fact, the APRA figures show that if it weren’t for many of our funds, the situation facing the industry could be even worse. Younger Australians are clearly shopping around, and choosing a health fund that aligns closer with their values of members before profits.”
He said the loss of smaller insurers “would be a disastrous result for consumers, especially when it comes to important health care decisions. It would also lead to the loss of many jobs in key regional communities, significantly impacting their economy.”
“Some Members Health funds have been around for up to and over 100 years, are resilient, well-capitalized and have successfully weathered many challenges,” said Mr Koce.