Health insurance premium increases will hit a four year-low in 2016 after a record number of insurers resubmitted lower price rises in response to a direct request from Minister for Health Sussan Ley.

Ms Ley confirmed 20 health funds in total had resubmitted a lower premium increase in the past couple of weeks, meaning lower-than-expected price rises for over 93 per cent of Australia’s 13 million private health customers.

“Overall, consumers will be $125 million better off as a direct result of our request for insurers to resubmit lower premiums, saving an average family with combined hospital and general health cover as much as $166 per year.”

Private health insurance premiums will now increase by a weighted industry average of 5.59 per cent from April 1 2016. This is compared to an average annual price rise of 6.1 per cent since 2002.

Ms Ley said some insurers were even offering their members average premium increases as low as 3.76 per cent*, with funds lowering their premiums by as much as 1.5 per cent in response to the Government’s request**.

“Hopefully today’s announcement has helped reinvigorate some competition between health funds and make it a little easier for consumers to shop around for the best deal while the Government undertakes broader reform. For independent advice free of commissions, go to”

Ms Ley welcomed today’s show of “good faith” from private health insurers in the Government’s current reform process, but cautioned this was just a first step and broader structural overhauls were needed to deliver significant, lasting savings for consumers on their premiums.

“I know every health insurance premium increase is hard on the household budget and we’re committed to taking the pressure off price rises for consumers through sensible and balanced reforms,” Ms Ley said.

“It must be acknowledged that the majority of insurers have used this opportunity to show consumers and the Government they are serious about engaging in this sensible reform process to try and lower premiums long-term.

“However, it also demonstrates the current premium approvals process isn’t providing the right checks and balances to ensure consumers get the best deal every year and there are clearly significant additional costs and barriers blocking larger premium savings from being passed on.

“For example, it’s easy to see the negative impact on premiums when a pacemaker for a private patient currently costs their insurer $43,000, despite the same device only costing $17,000 if they were treated as a public patient.

“That’s why we’re also currently working with the entire medical devices supply chain to take pressure off premiums and we expect any savings to begin flowing through to consumers as early as next year.”

“Other areas we’re looking at included greater transparency around health policies, including addressing junk products, confusing terminology and hidden payments, for consumers as part of a balanced package of reforms.”

Total benefits paid to private health insurance members grew by $1 billion – or 5.7 per cent – from about $17.2 billion to $18.3 billion in the 12 months to December 2015.

More-than 40,000 Australians recently overwhelmed a Turnbull Government survey on private health insurance, with the majority raising concerns about the affordability of their premiums and the value for money they received from their policies.

Ms Ley said this spurred her on to seek some interim relief for policy holders while reform was undertaken after receiving insurer requests for another average premium increase around six per cent in 2016.

“Private health insurance is a fundamental element of our health system that offers consumers greater choice while taking pressure off of Medicare so that its universality remains sustainable.

“It’s therefore imperative we act now to ensure it continues to deliver value for money for consumers both short and long-term.

“This is particularly important after Labor’s ideological attempts to destroy private health insurance in Government by encouraging people to dump or downgrade their policies through multi-billion cuts to their rebate.”

Ms Ley said increasing premium prices had been a challenge faced by successive governments, with Labor approving average annual premium increases as high as 6 per cent and over during their six years in office.

*The full list of average premium increases for individual health funds is available at

**Due to commercial-in-confidence arrangements the Government is unable to provide a fund’s original premium request if they lower it upon request of the Minister.