Private Health Insurance

About the Inquiry

The Industry Commission was asked to report on

• the current state of the private health insurance industry including its structure and efficiency;
• the cost pressures upon the industry, particularly:
  • the impact of declining membership levels;
  • increasing health care costs, including the relationship between private health funds and hospitals;
  • (usage of private hospitals;
  • the impact of reforms allowing the setting of premiums for 100 per cent private cover; and
  • the different costs to the industry of hospital beds in private and public hospitals;
• the most effective means of ensuring that contributors receive the maximum benefit from the Government’s private health insurance financial incentives;
• options to encourage the emergence of innovative and price competitive products which cater for the varying needs of consumers;
• an appropriate regulatory framework within which funds should set reserves and premiums;
• any other measures which could be undertaken to remove impediments or otherwise contribute to the efficiency and development of a competitive industry; and
• the identification of groups which would benefit from, or be disadvantaged by, any measures which would flow from the previous three points, and implementation strategies for the proposed measures;