Claire Clutterham (Sturt, Australian Labor Party) | Hansard source

I rise to speak in support of the Health Legislation Amendment (Improving Choice and Transparency for Private Health Consumers) Bill 2026. There are two key purposes to this bill. Firstly, it amends the Health Insurance Act 1973 and the Private Health Insurance Act 2007 to allow the Department of Health, Disability and Ageing to publish information for consumers on medical fees charged by medical practitioners, including specialists and general practitioners, together with the likely out-of-pocket costs for their private healthcare experience. The purpose is to support greater transparency and healthcare pricing, helping consumers make informed decisions about their health care and obtain better value from private health insurers.

Secondly, it amends the Private Health Insurance Act to require insurers to seek ministerial premium approval for new products and existing products where certain changes are proposed. The new premium approval process provided in the bill broadly aligns with the current process for premium changes for existing products. The purpose of these provisions is to expand and formalise ministerial oversights of premium setting for private health insurance products.

Overall, the bill aims to strengthen transparency and improve patients understanding of their health care and private health insurance arrangements which can often be very complex, difficult to understand and difficult to apply. Measures that facilitate greater transparency from private health insurance regarding what policies include, how agreements with providers operate and how arrangements affect patients and hospitals, together with measures requiring private health insurance to clearly explain what is and what isn't covered, are critical. People often access their private health cover during times of illness and stress, and they should not be left navigating complexity alone during this time. Anything that helps patients understand what they're paying for and why something is included or not included is something that should be prosecuted, as should the provision of genuine help for patients to assist them to anticipate their out-of-pocket costs.

Furthermore, this bill will outlaw the practice that is known as product phoenixing, where private health insurers close a product and then reopen an identical one at a higher price or reduce the value of a product. This is designed to close a pre-existing loophole.

We know that many Australians choose to take out private health insurance for personal, individual reasons. Private health insurance, especially hospital cover, provides security. It's peace of mind knowing you and your family will be cared for if you're injured or have a health condition. Having private hospital insurance means that, even if the worst happens, there is a security blanket. Hospital cover can provide that security. Private health insurance can also mean more choice in your healthcare, in that you have more choice when it comes to choosing the doctors, surgeons and specialists who might treat you.

Then there is time. Depending on your cover, private health insurance may help avoid public hospital waiting lists so you can access the care that you need more quickly. That being said, in Australia, although our public health system is very good, there are challenges, and there can be long wait times to get elective surgery. Having private hospital cover means you might get faster treatment for elective surgery, unlike those who rely only on the public system. Extras are another important part of private health insurance, and, depending on the type of cover, you may then be able to claim back money for a range of health services that might not be covered by Medicare up to your yearly cover limits.

Many Australians take out private health insurance because they want more security, more choice and quicker treatment than what the public system is able to offer. They also take it out because they know that sometimes lightning strikes. Nobody has a crystal ball about what future health issues might affect them, and many people just want to be prepared. Given its importance as well as the cost, the private health insurance system needs to be transparent and clear about what is covered and at what cost. It also needs to be sustainable and equitable for everyone. In a health system where it's important to have a balance between private and public health services, it is a disincentive to take up private health insurance if costs are opaque, hard to understand or not available until after the event.

This bill, the Health Legislation Amendment (Improving Choice and Transparency for Private Health Consumers) Bill 2026, will enable Australians to make informed decisions about their health care and their private health insurance. It will enable them to weigh up the factors that underpin a decision to take up private health insurance or not. Schedule 1 of the bill is dedicated to this in that it provides consumers with more detailed information on the expected medical fees charged and the likely out-of-pocket costs for a private healthcare experience. The schedule will facilitate the publication of the relevant data on the Medical Costs Finder without the need for input from specialists, as it will be drawn from Medicare, hospital and insurer billing data already collected by the government.

The Medical Costs Finder, operated under the auspices of the Department of Health, Disability and Ageing, is a tool to find and understand costs for GP and medical specialist services across Australia, because it can't be right that patients who need treatment are required to commit to that treatment without knowing what the cost of the treatment will be and without being equipped with the tools to enable them to compare those costs with costs charged by other like providers.

When you go to a restaurant, the prices are on the menu. You know what you're up for before you place an order, and no-one would go to a restaurant and order dinner without knowing what it was going to cost. Now, no-one is saying that the provision of highly skilled surgery by incredibly well-trained and intelligent medical professionals is the same as eating a meal in a restaurant, but the principle of transparency before the event is the same. People need to know if they can afford a service before they commit to it—what savings and sacrifices they may have to make to pay for the health care that they need, what they might need to give up or go without in order to fund the health care that they need.

The fees and charges applied by surgeons and specialists are what they are because the work is incredibly skilled, performed by clinicians who have spent years and years training and honing their craft in order to provide the best possible outcomes to their patients in often incredibly difficult, complex and challenging environments. This bill recognises that, but all it seeks to do is to make sure that patients understand what those costs are prior to incurring them and that patients have had the opportunity to compare the costs of multiple skilled providers. Comparison might not matter to some patients; they know who their preferred surgeon is, and that is the end of the matter. But others do want to investigate and explore, just to be sure, and the capacity for patients to do that on the basis of accurate data is completely reasonable.

The private health system also relies on private health insurers operating with integrity and incentivising people in a fair and transparent and ethical way to take up or maintain private health insurance for themselves and their families. Schedule 2 of the bill is directed at this, and that is relevant to changes to strengthen ministerial oversight of private health insurance premiums to better protect consumers.

Without schedule 2, the status quo would remain, and that status quo is that private health insurers are required to apply to the minister if they wish to change the premium for an existing product, which typically occurs annually as part of the annual premium round process. Currently, there is no requirement for insurers to seek approval for the premium charged for new products, and what has happened in some instances is that this loophole has been used to bypass the intent of the premium round by closing an existing product to new members and then launching a new but very similar product at a higher price than was previously authorised by the minister for the existing product.

This process, known as phoenixing, has driven up the cost of private health insurance policies, far exceeding government-approved average increases. Phoenixing means that some Australians end up paying more than they need to, especially those on newer or top-tier policies. These steep hikes don't just increase costs. They also discourage tailored health care because many policyholders choose to stay on older, cheaper plans to avoid sudden price jumps, which limits their options and may result in them not actually enjoying the benefit of the most appropriate policy for them. Other consumers might then elect to downgrade their cover, which ultimately leads to the risk that they will be underinsured and exposed if their cheaper policy does not include the treatment they actually need, rendering it useless in terms of value for money.

Schedule 2 of the bill addresses this issue through amendments to the Private Health Insurance Act that will require insurers to apply to the minister for approval for the premiums for new and existing products. In addition to requiring ministerial approval for proposed premium changes, insurers will have to apply if they open a new product or they reduce the cover, benefit or other term or condition of an existing product. If a product is genuinely unsustainable, not being taken up or genuinely loss-making, with few available mitigation strategies to counter this, then a new product can still be initiated, just not without the minister's prior approval on the associated premium, making it fairer for consumers.

This is an important reform that has at its heart the purpose of ensuring the private health insurance industry is operating to the benefit of consumers and for the purpose of ensuring consumers are able to make informed decisions and select policies that are appropriately tailored for their individual healthcare needs, all underpinned by accurate and contemporary data.

The government values the private health insurance industry and will always look to implement reforms that ensure the industry delivers value for money and transparency for consumers in a way that facilitates consumers having choice and agency over their healthcare decisions. That is what this bill does, and I commend the bill to the house.

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