19 December 2018 - Private health insurers are hopeful more Australians will take up cover and existing members will stop downgrading policies after the government said premiums would rise by an average 3.25 per cent next year – the lowest annual increase in 18 years.

Despite private health insurers paying for $20.5 billion of medical care in the past year, up 3.4 per cent on the prior year, insurers are under pressure due to customers turning their backs on the sector.

In a November review, the Australian Competition and Consumer Commission found more Australians are downgrading or dumping their private health insurance because of rising premiums. More than 13 million consumers have been lowering policies or scrapping them all together in the face of rising premiums and more out-of-pocket costs. The government invests about $6.4 billion annually in the private health insurance rebate, which subsidises the cost of cover.

Read Australian Financial Review article