Private health insurance reforms: Overview

The Minister for Health, the Hon Greg Hunt MP, announced a series of reforms to private health insurance on 13 October 2017 to make private health insurance simpler and more affordable for Australians

Page last updated: 16 July 2018

Private health insurance reforms: Overview (PDF 114 KB)

These include:

  • categorising hospital insurance products as gold/silver/bronze/basic, and implementing standardised clinical categories for treatments to make it clear what is and isn’t covered in policies
  • upgrading the privatehealth.gov.au website to make it easier to compare insurance products, and allowing insurers to provide personalised information to consumers on their product
  • boosting the powers of the Private Health Insurance Ombudsman and increasing its resources to ensure consumer complaints are resolved clearly and quickly
  • reducing costs for consumers through a $1.1 billion reduction in prostheses benefits under an agreement with the Medical Technology Association of Australia
  • requiring insurers to allow people with hospital insurance that does not offer full cover for mental health treatment to upgrade their cover and access mental health services without a waiting period on a once-off basis
  • allowing insurers to discount hospital insurance premiums for 18 to 29 year olds by up to 10 per cent, with the discount phasing out after people turn 41
  • allowing insurers to expand hospital insurance to offer travel and accommodation benefits for people in regional and rural areas who need to travel for hospital treatment
  • increasing the maximum voluntary excess consumers can choose under their health insurance policies for the first time since 2000
  • removing coverage for a range of natural therapies as benefits under general treatment
  • continuing to support private hospitals, including transferring administration of the second tier default benefit, which provides a safety net for consumers attending non-contracted hospitals, to the Department of Health.
To progress reforms the government introduced the Private Health Insurance Legislation Amendment Bill 2018 and related bills to Parliament on 28 March 2018, and on 16 July 2018 the Government released an Exposure draft of the amendments to the Private Health Insurance Rules, which allow insurers to implement these reforms.

The government is continuing to work with the medical profession on options to improve the transparency of medical out-of-pocket costs, and has established a working group to review funding and regulation for rehabilitation care and mental health care.

The issue of private patient patients in public hospitals is being considered as part of the Heads of Agreement with underpins public hospital funding arrangements. The Commonwealth and most states and territories have signed this agreement as the basis for arrangements to commence in 2020-21.

Fact sheets providing further information on each of these reforms are available.