AMA submission to the consultation on outlawing private health insurance product phoenixing
The AMA has long advocated for closing the legislative loophole allowing private health insurers to ‘phoenix’ products.
The AMA believes this practice is severely impacting the affordability of products, especially in the critical ‘gold’ tier category — the only product tier through which many Australians can obtain no-wait cover for various types of private healthcare, including maternity care, mental healthcare, and joint replacements.
The AMA therefore supports legislative amendments to require private health insurers to use the annual Premium Round to seek approval for the pricing of new products, unless they can demonstrate ‘exceptional circumstances’ whereby it is ‘in the public interest’ to submit a new product application to the minister outside the normal Premium Round process. The AMA also agrees private health insurers should retain the ability to close or terminate products to manage prudential risk, while being prevented from using such product closures to facilitate phoenixing.
