PHA: Premium increase deferred for six months

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Private Healthcare Australia chief executive Dr Rachel David has announced the association's member health funds will postpone the 1 April premium increase for at least six months.

At the same time, health minister Greg Hunt has told media federal and state governments are 'close to an agreement' with private hospitals on guaranteeing capacity in response to COVID-19 and the shutdown in elective surgery.

Private hospitals had raised concern over their short-term ability to prepare for the expected spike in hospital admissions in response to COVID-19 after they were forced to shut down elective surgery.

Dr David said the announced postponement of the 1 April premium increase is part of a wider package of support measures to relieve pressure on consumers during the pandemic, including full hospital coverage for people affected by COVID-19. Health funds will also cover telehealth services from psychologists from tomorrow (30 March). Some insurers have waived the increase for 12 months.

Health minister Greg Hunt approved an average 2.9 per cent increase late last year.

The average increase was the lowest in 19 years but the economic shock related to COVID-19 and the response is causing the loss of hundreds of thousands of jobs.

Private Healthcare Australia said health funds have been working with government and regulators on approval for measures to ease financial pressure on their members while maintaining health services including critical dental care.

The association said health funds and the Department of Health will review the measure prior to six months after reassessing growth in demand for non-emergency surgery and the impact of COVID-19 on the Australian health system.

“This is a continuing process and health funds will be regularly reviewing their financial position in coming months to provide as much support as possible to members. It is a tough time for all Australians and circumstances are changing rapidly. We will do all we can to support our members and the Australian community,” said Dr Rachel David.

“At the same time health funds also need to maintain the government’s legislated capital adequacy requirements and must remain in good shape so we can fund the backlog of elective surgery that will certainly occur in 6-12 months’ time,” she said.

Dr David urged members whose financial circumstances have changed to talk to their health fund before considering downgrading or dropping their health cover.