“The devices industry was the sole contributor to lower private health insurance premium increases both in 2017 and in 2018. MTAA’s Agreement with the Government is on track to exceed $1.1 billion in expected savings,” said Ian Burgess, CEO of the Medical Technology Association of Australia (MTAA) today.
“The claim that the listing of new, innovative and more clinically effective technologies is somehow a negative, is completely absurd and demonstrates that the insurers have lost focus on patients,” Mr Burgess said.
Meanwhile, insurer profits continue to increase, with NIB reporting a 9.2 per cent increase in annual profit recently to $201.8 million, with a share price increase of 31 per cent over the past six months, and Medibank Private’s share price up 16 per cent.
The recently released AlphaBeta report, Keeping Premiums Low: Towards a more sustainable private healthcare system, found that insurers have collected 50% more profit from each of their members over the past five years, far outpacing the 21% growth in benefits paid out.
It also found that private health funds have not extracted sufficient economies of scale in the wake of significant revenue growth and many funds are well above the industry average of 9% in operational expenditure, this includes an estimated marketing spend of $400 million.
“After tax profits for insurers are up 15% over the past three years as affordability for ordinary Australian families goes down,” Mr Burgess said.
“Patient and clinician choice is a key part of the value proposition of private health insurance, one that risks being eroded by the false claims made by insurers about the cost of devices,” said Mr Burgess.
“The medical technology industry believes access to a full range of medical technology is one of the key benefits of having private health insurance and we’re committed to helping ensure all Australians lead healthier and more productive lives,” Mr Burgess concluded.