5 Things You Should Know about the sale of Medibank
With health insurance premiums about to be hit by the biggest increase in a decade, the federal government has confirmed it plans to sell health insurer Medibank Private, the country’s largest fund, in the next financial year.
1. The government says there is “no reason” why the sale of Mediabnk would push prices up, according to a “scoping study” it commissioned but hasn’t released. But the opposition disagrees, saying it will decrease competition and could leave consumers worse off.
2. Medibank and its subsidiaries, such as ahm health insurance, have about 30% of the Australia market.
3. The only other publicly-listed health fund is NIB, which demutualized in 2007 and issued shares to its then-members. But unlike NIB members, Medibank policyholders will not receive shares in the sale, Finance Minister Matthias Cormann said. They may receive some preferential treatment if they want to buy shares, but that will depend upon what sort of sale the investment bankers recommend.
4. The sale could raise about $4 billion, which will be mostly spent on high priority road and infrastructure projects, but it will also mean the budget loses hundreds of millions of dollars in dividends from the fund each year.
5. More than 4,400 FiftyUp Club members have now filled out our health insurance survey to help unearth some facts about premium increases for FiftyUps. The early results suggest that policyholders over 50 are paying substantially more than the 6.2% average premium increase published by the federal government. And that includes Medibank customers. Stay tuned for the full and final results next week, and click here to fill out the two-minute survey.
Are you a Medibank customer? if so, what do you think of the sale? Do you think it will push premiums up or down?
