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Some Australians would struggle to afford private health cover and others would tear up their policies after insurers received official approval yesterday to raise their premiums 5 per cent.
The rise was part of a rash of bad economic news for Australian families yesterday.
The National Australia Bank announced it was raising its standard variable home loan rate by 29 basis points to 9.27 per cent.
Defying Government calls for restraint, the NAB’s rise is four basis points above the Reserve Bank of Australia’s quarter of a percentage point increase on Tuesday.
Oil prices also surged past $US105 for the first time yesterday.
A peak consumer group predicted pain for health insurance policyholders yesterday when federal Health Minister Nicola Roxon announced health funds would increase their premiums 4.99 per cent on average. Ms Roxon conceded the rise in health insurance premiums would put ‘‘a lot of families under pressure’’.
‘‘[But] our intervention has meant that over three million Australians are going to be paying less for their premium increases than they would have if we had not intervened,’’ she said.
Ms Roxon had urged several health funds to review their annual applications to raise premiums because she feared some wanted increases that were ‘‘larger than necessary’’.
‘‘But we are [now] satisfied that each fund has convinced us either that these are the minimum necessary or have been able to reduce the amounts that they were seeking,’’ she said.
She was still talking with one health fund that was seeking an ‘‘extremely high’’ increase and she saw rejecting the bid as a ‘‘very serious option’’.
Overall, health insurance premiums would rise by 4.99 per cent from April 1 and families would pay about $100 more annually for the average policy as a result. But Ms Roxon said the sector had originally applied for a 5.21 per cent increase. ‘‘So the reduction that has been achieved is nearly a quarter of a per cent,’’ she said.
‘‘Obviously it will still put pressure on many working families but we have, we believe, intervened in a way which makes sure these increases are the minimum possible that can be delivered while the industry remains viable.’’
Opposition health spokesman Joe Hockey said the Labor Government had displayed its hypocrisy.
A year ago, Ms Roxon attacked the Coalition government for increasing private heath cover premiums by 4.5 per cent but she approved a 5 per cent rise yesterday.
‘‘Labor said it would protect working families from fee increases.
Today working families are feeling betrayed by Labor’s hypocrisy,’’ Mr Hockey said.
Australia’s largest private health insurer, Medibank Private, announced its premiums would increase 4.64 per cent on average.
Australians with a single membership would pay $1.07 extra a week and those with family memberships would $2.14 more weekly as a result. HBA would lift fees by 4.58 per cent, while NIB would charge 4.99 per cent more for private health cover.
In the past financial year, the Federal Government spent $3.3 billion to subsidise private health insurance through rebates.
The privately insured receive a 30 per cent rebate on their premiums, which increase to 40 per cent for those aged 70 years or older.
Premiums had skyrocketed by more than 50 per cent since 2001, taking into account the new increase that outstripped inflation.
Some Australians would struggle to afford private health insurance and others would tear up their policies as a result, according to a health policy officer with peak consumer group Choice, Michael Johnston.
‘‘Any increase is bad for consumers especially at this time when interest rates are going up,’’ Mr Johnston said. ‘‘It really highlights to us the concerns we have about the value for money that people get out of private health insurance.’’
The rise was part of a rash of bad economic news for Australian families yesterday.
The National Australia Bank announced it was raising its standard variable home loan rate by 29 basis points to 9.27 per cent.
Defying Government calls for restraint, the NAB’s rise is four basis points above the Reserve Bank of Australia’s quarter of a percentage point increase on Tuesday.
Oil prices also surged past $US105 for the first time yesterday.
A peak consumer group predicted pain for health insurance policyholders yesterday when federal Health Minister Nicola Roxon announced health funds would increase their premiums 4.99 per cent on average. Ms Roxon conceded the rise in health insurance premiums would put ‘‘a lot of families under pressure’’.
‘‘[But] our intervention has meant that over three million Australians are going to be paying less for their premium increases than they would have if we had not intervened,’’ she said.
Ms Roxon had urged several health funds to review their annual applications to raise premiums because she feared some wanted increases that were ‘‘larger than necessary’’.
‘‘But we are [now] satisfied that each fund has convinced us either that these are the minimum necessary or have been able to reduce the amounts that they were seeking,’’ she said.
She was still talking with one health fund that was seeking an ‘‘extremely high’’ increase and she saw rejecting the bid as a ‘‘very serious option’’.
Overall, health insurance premiums would rise by 4.99 per cent from April 1 and families would pay about $100 more annually for the average policy as a result. But Ms Roxon said the sector had originally applied for a 5.21 per cent increase. ‘‘So the reduction that has been achieved is nearly a quarter of a per cent,’’ she said.
‘‘Obviously it will still put pressure on many working families but we have, we believe, intervened in a way which makes sure these increases are the minimum possible that can be delivered while the industry remains viable.’’
Opposition health spokesman Joe Hockey said the Labor Government had displayed its hypocrisy.
A year ago, Ms Roxon attacked the Coalition government for increasing private heath cover premiums by 4.5 per cent but she approved a 5 per cent rise yesterday.
‘‘Labor said it would protect working families from fee increases.
Today working families are feeling betrayed by Labor’s hypocrisy,’’ Mr Hockey said.
Australia’s largest private health insurer, Medibank Private, announced its premiums would increase 4.64 per cent on average.
Australians with a single membership would pay $1.07 extra a week and those with family memberships would $2.14 more weekly as a result. HBA would lift fees by 4.58 per cent, while NIB would charge 4.99 per cent more for private health cover.
In the past financial year, the Federal Government spent $3.3 billion to subsidise private health insurance through rebates.
The privately insured receive a 30 per cent rebate on their premiums, which increase to 40 per cent for those aged 70 years or older.
Premiums had skyrocketed by more than 50 per cent since 2001, taking into account the new increase that outstripped inflation.
Some Australians would struggle to afford private health insurance and others would tear up their policies as a result, according to a health policy officer with peak consumer group Choice, Michael Johnston.
‘‘Any increase is bad for consumers especially at this time when interest rates are going up,’’ Mr Johnston said. ‘‘It really highlights to us the concerns we have about the value for money that people get out of private health insurance.’’
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