Medibank Private today announced that premiums will rise by an average of 4.64 per cent, a rise of around a dollar per week for a single membership. This is below the industry average increase of 4.99 per cent.
While costs of providing services for Medibank Private members are growing annually by over 8 per cent, the fund has shielded members from these increased costs by successfully lowering the growth rate of premiums for the fourth year running.
Medibank Private Industry Affairs Manager, Craig Bosworth, acknowledged the current pressures on household finances but stressed the importance of providing consistency for family budgets.
"For Australians to maintain their private health insurance they have to be able to manage the cost, so we have to make it easier for individuals and families to budget. Members don't want volatile increases in premiums year to year.
"Importantly though, Medibank Private needs to be financially dependable - we have to be there to pay for medical treatment and services when our members need us.
"Nobody doubts that healthcare is expensive. As an example, in 2007, Medibank Private paid its first claim over $500,000 for a respiratory operation for one of our members. A cardiac defibrillator costs $50,000 and a hip replacement $20,000. Even having a baby can cost $10,000, and these costs are borne by the fund on behalf of members.
"It's a balancing act between keeping health insurance affordable, given hospital and medical costs are running at twice the rate of inflation, and being capable of funding expensive medical services.
"The reality is that premiums have increased at a lower rate than the increase in benefits paid on behalf of our members. Last year Medibank Private paid out a record $2.6 billion in member benefits, an increase of 8 per cent," he added.
The multitude of products in the health insurance market can sometimes seem confusing for consumers. Medibank Private encourages current and prospective members to develop greater knowledge of their health insurance, and to gain a clear and complete picture of what is available.
"You need to make sure you are comparing apples with apples. Some product assessments, such as selected online web tools, don't provide a full picture of what you are getting for the promoted price. Speaking with a consultant in one of our retail centres allows you to be guided through the process and is the best way to ensure your expectations for health insurance cover are matched to your life stage and health needs " Mr Bosworth said.
The rate change will take effect on 1 April, 2008.
ENDS
For further information please contact:
James Connors
Tel: 03 8622 5163 | Mob: 0433 992 677 | email: james_connors@medibank.com.au