The Health Minister has asked private health insurers for information on possible premium increases for 2016, in an attempt to ensure consumers get the best deal.

“I have held increasing concerns [that] the current process used to assess and approve premium increases does not allow Government a rigorous assessment of an insurer’s full financial position,” federal Minister for Health Sussan Ley said.

Much of the concern about premium increases has come since the Abbott Government sold Medibank Private, giving up the regulatory role it had played in health insurance.

But Ms Ley says the Government can still impose some control.

“Unlike other insurance industries, the Federal Government holds a significant stake in the private health sector, providing around $6 billion in rebates to consumers every year,” she said.

“I have therefore tasked my Department to work with insurers to make sure any premium increase is the minimum necessary, taking into account APRA’s prudential requirements.”

It is understood that health funds have been asked to resubmit an application for a lower premium increase or provide any evidence of extenuating circumstances.

“It is important I am armed with the full picture before approving any premium increase, particularly as consumers are telling me they are finding it increasingly difficult to simply ‘shop around’ for a better deal. “

The Government says its consultations on private health insurance showed consumers have strong concerns about the affordability of their premiums.

Ms Ley says this is hardly surprising, given that premiums have increased at a rate of around 6 per cent per year for the past five years.

“The Government recognises the desire of health insurers to engage in reform and we are keen to continue to work with them to deliver a better outcome for consumers,” she said.

“As this remains a commercially-sensitive process, it is inappropriate to comment further on the detail of any proposed premium increases until a final decision is announced.”