The Australian Prudential Regulation Authority (APRA) has issued its quarterly report on private health insurance (PHI) for the March 2024 quarter.
The report encompasses membership, coverage, benefits paid, medical gap, prostheses, and medical services statistics.
As of March 31, 2024, 12,171,944 individuals, or 44.8% of the population, were covered by hospital treatment insurance. This represents an increase of 79,023 people compared to December 2023.
Family policies rose by 10,158 and single policies by 19,693. The most significant increase in coverage was observed in the 40-to-44 age group with 10,865 individuals, while the 0-to-4 age group experienced the highest net increase with 27,689 people.
Regarding lifetime health cover, 88.4% of adults with hospital cover had a certified age of entry of 30, avoiding penalty loading.
As of the end of March 2024, 1,019,071 individuals had a certified age of entry above 30 and were subject to loading, indicating a net increase of 68,279 over the past year. Additionally, 122,002 people had their loading removed after paying it for 10 years.
In the area of general treatment, 14,807,610 people, or 54.6% of the population, had some form of coverage as of March 31, 2024. This is an increase of 93,067 from the previous quarter. General treatment policies grew by 47,389, primarily due to a rise of 27,064 single policies.
Over the year, the number of individuals with general treatment coverage increased by 315,510. The 0-to-4 age group saw the largest net increase in coverage during the quarter, with 28,770 more people.
For the March 2024 quarter, insurers paid $4,286 million in hospital treatment benefits, a 4.13% decline from the December 2023 quarter. These benefits included $3,097 million for hospital services, $627 million for medical services, and $562 million for prostheses.
Average hospital benefits per person increased from $1,357.70 in March 2023 to $1,453.14 in March 2024, with the largest expenditure on hospital accommodation and medical services.
Insurers paid $1,645.8 million in general treatment benefits, a 3.1% increase from the December 2023 quarter.
Major categories included dental ($889.8 million), optical ($274.9 million), physiotherapy ($129.5 million), and chiropractic ($86.6 million).
General treatment benefits per person rose from $449.73 in March 2023 to $464.30 in March 2024, with dental services being the largest component.
Medical benefits decreased by 6.0% in total payments during the March 2024 quarter. Anaesthetics accounted for the largest portion of medical benefits at 24.8%, totalling $155.45 million.
Prostheses benefits also saw a decrease of 7.4%, with cardiac prosthetics making up 17.6% of all prosthetic benefits, totalling $99.14 million.
In terms of service utilisation, insurers paid benefits for 3.0 million hospital days arising from 1.2 million hospital episodes during the March 2024 quarter.
Hospital episodes were distributed as follows:
Hospital utilisation decreased by 4.5%, mainly due to a reduction in hospital-substitute episodes.
Out-of-pocket payments for hospital episodes increased by 6.7% compared to the same quarter the previous year.
The average out-of-pocket payment for hospital episodes was $426.80, which includes payments for medical services and any excess or co-payment amounts related to hospital accommodation.
Orthopaedic services had the highest average out-of-pocket payment at $666.17.
Earlier this month, APRA released its insights following the review of Internal Capital Adequacy Assessment Plan (ICAAP) Summary Statements and data submissions from the private health insurance (PHI) sector. It highlighted the importance of the ICAAP summary statement in overseeing risk and capital adequacy. It also shared its insights on ICAAP best practices drawn from both general and life insurance.
