Millions of Australians will see an increase in their private health insurance premiums, with an average rise of 3.73% from April 1, the highest in eight years.
Despite pressure from the Albanese Government to curb hikes, the increase remains above inflation.
Health Minister Mark Butler approved the premium adjustments after rejecting initial proposals from insurers.
"I wrote to all 29 insurers urging them to submit fairer increases," Butler stated. "I was not prepared to approve excessive hikes."
Western Australia’s largest insurer, HBF, will impose the smallest increase among major providers at 2.8%.
However, policyholders with market leaders Bupa and Medibank Private (ASX:MPL) face hikes of 5.1% and 3.99% respectively. Nib (ASX:NHF) customers will see the sharpest rise at 5.79%.
Rising healthcare costs, including higher wages, medical device prices, and hospital expenses, have driven the increases.
Bupa’s acting managing director Kate Williams acknowledged the strain on customers but cited inflationary pressures. "We are balancing affordability with the rising costs of care," she said.
Medibank's New South Wales policyholders will endure an even steeper 4.81% increase due to additional state-imposed charges on single-room stays in public hospitals.
With an election looming, the Federal Government is wary of financial pressures on households.
Private health insurance remains a significant expense, with 15 million Australians paying nearly $39 billion in premiums in the past year.
Despite efforts to moderate increases, insurers argue that escalating healthcare demands necessitate the adjustments.
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