Australia: Private health insurance changes need to address gap policy reforms – Asia Insurance Review

Private health insurance reforms announced by the government last week, while bringing positive
changes, are only halfway complete, Dr Peter Sumich, president of the Australian Society of
Ophthalmologists (ASO) has said. He said that the new four-tier private health insurance system should
provide a necessary boost to competition among insurers and exert downward pressure on policy fees.
“While the work done to-date is substantial, we are only half way there,” Dr. Sumich said. “Additional
focus now needs to be given to gap policy reform in order to really help patients with out-of-pocket
expenses,” he said.
Dr. Sumich said gap policy reforms will need to address the following:
 differential rebating;
 copayment plans which have not been indexed for 20 years, and;
 Poor indexation of private rebates.
“Each of these factors contribute significantly to a patient’s out-of-pocket expenses and must be
addressed,” Dr. Sumich said. The reforms announced by the government on 11 October aim to make
private health insurance simpler and cheaper.
The new rules establish simple clinical categories and a ‘Gold, Silver, Bronze and Basic’ classification
system. New insurance policies will be categorised under this system from April 2019, and by April 2020
all products must fully comply with the new arrangements.

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