Insurers reap ‘rampant profits’: Shorten

CorruptionBill Shorten is keeping private health insurance companies in his sights, accusing them of reaping a better return than the big banks.

The Labor leader used his major speech kick-starting 2018 to put insurers “on notice” for their premium hikes, as well as the federal government.

Premiums rose 4.84 per cent last year and are due to go up by an average 3.95 per cent in April.

That is the lowest rise in 17 years.

But Mr Shorten wants to sit down with the insurers, claiming increases are out of control.

“Private health insurance companies, the big ones, have a better return on profits or return on equity than the banks,” he told the Nine Network on Wednesday.

Mr Shorten confirmed he will not be abolishing the private health insurance rebate.

“We think there is a role for private health insurance but it’s got to work for people,” he said.

The private health insurance industry says it’s open to talks with Labor on improving the system, but believes policy premium rises have been reasonable.

Chief executive of insurer nib, Mark Fitzgibbon, said the n population was ageing and, as there were fewer taxpayers, alternative ways were needed to pay for the health system.

“While there’s always room for improvement we think we’ve done reasonably well in recent years in keeping a lid on premium inflation against a backdrop of rising spending, including now funding many public hospitals,” Mr Fitzgibbon said.

“If Mr Shorten has some additional ideas as to how we might further improve we’re all ears.”

Health Minister Greg Hunt said health insurance cover would always be lower under the coalition, because Labor in government had cut rebates.

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