One of Australia’s biggest health insurers will pay back $35million after thousands of hospital claims were wrongly rejected.
Bupa has reached an agreement with the Australian Competition and Consumer Commission to pay a hefty penalty for wrongly advising customers they were not entitled to private health insurance benefits for their entire claim, when in fact they were.
The UK-based multinational health insurer, which bought MBF in 2008, has started compensating affected members, medical providers and hospitals.
To date, Australia’s second biggest health insurer has paid out $14.3million to those affected by 4,100 claims, following a court order.
Bupa customers were left out of pocket for medical expenses that should have been covered by their health insurance policy between 2018 and 2023.
Bupa Asia-Pacific chief executive Nick Stone has issued an apology and acknowledged that it should ‘never have happened’ with regards to 388 mixed coverage claim products.
‘We are deeply sorry for failing to get things right for our customers and are saddened by the impact this has had on them and their families,’ he said.
‘This should never have happened.
One of Australia’s biggest health insurers will pay back $35million after thousands of hospital claims were incorrectly rejected
Bupa Asia-Pacific chief executive Nick Stone has issued an apology and acknowledged that it should ‘never have happened’ with regards to 388 mixed coverage claims
‘Our priority has been to communicate and compensate our affected health insurance customers and providers, along with putting in place measures to help ensure this does not happen again.’
The competition regulator took legal action against UK-headquartered Bupa for breaching Australian consumer law by wrongly assessing two sub categories of hospital and medical claims – known as ‘mixed coverage’ and ‘uncategorised items’.
Bupa customers are advised to come forward if they had made a mixed coverage claim from May 1, 2018 to August 31, 2023.
ACCC chair Gina Cass-Gottlieb said Bupa’s actions had caused its policyholder to delay medical treatment.
‘Bupa’s conduct affected thousands of members over more than five years, and caused harm to consumers some of whom delayed, cancelled or went without treatment for which they were, at least partially, covered under their health insurance policies,’ she said.
‘Consumers purchase private health insurance to provide peace of mind, certainty of coverage and the ability to choose where and when to undertake their procedures.
‘Bupa’s conduct denied certain members benefits to which they were entitled to under their private health insurance policies.’
The Federal Court will now consider a settlement.
Bupa, with a 25.4 per cent market share, is Australia’s second largest private health insurer after Medibank on 26.7 per cent, Australian Prudential Regulation Authority data shows.
