Largest Australian health fund premium rises in nine years Health insurance companies have teamed up with the Government to announce the biggest hike in health insurance premiums in nearly a decade Approves highest health funds premium rises in nine years ... Minister for Health and Sport Peter Dutton during Question Time in the House of Representatives in Parliament House, Canberra. THE largest health fund premium rise in nine years will increase the cost of health insurance by up to $21 a month. Premiums will rise by an average 6.2 per cent from April next year with members of health fund NIB experiencing the largest rise of 7.99 per cent. Usually the premium rise is not announced until February and at this time of year health ministers traditionally ask some health funds to return to the drawing board and moderate their premium rise. Instead, Health Minister Peter Dutton approved the funds' premium applications and said the rise would give health fund members "certainty" in their private health insurance. "There is no doubt this increase could have been lower had it not been for the pressures placed on the sector by Labor," he said. Each application has been closely scrutinised to ensure the increases sought are fully justified. Under changes introduced by the previous government, the private health insurance tax rebate will cover less of the increase. Instead of increasing by 6.2 per cent, the 30 per cent rebate will rise only by the inflation rate, currently just 2.2 per cent. This will leave consumers with higher out of pocket expenses. Consumer's Health Forum spokesman Mark Metherell said he was surprised the premium rises were being announced just two days before Christmas. "It's hardly great tidings for ordinary Australians," he said. "A $200 annual increase in their premiums would buy their children a decent Christmas present," he said. He was also surprised the premium rise announcement had come two months ahead of the traditional schedule of February. "It's obviously earlier than we've been used to in recent years," he said. It was unclear whether Health Minister Peter Dutton had asked some health funds to re-examine the size of their rises but "if he hasn't it seems surprising given the scale of the increases," he said. Health fund premiums have risen in excess of inflation for more than a decade and a typical family policy now costs between $3,500 and $4,000 a year pushing it out of the reach of lots of ordinary wage earners, Mr Metherell said. You do wonder whether the government is keen to see a greater number of Australians take out health insurance. I thought that was their goal but the sorts of barriers these price rises represent surely aren't going to help," he said. Opposition Health spokesperson Catherine King said each year Australia's private health insurers are required to submit applications to the Private Health Insurance Administration Council for premium rises and the minister decides what increase is approved. Labor had kept health fund premium rises to 5.5 per cent or less when it was in power, she said. "Making this announcement two days before Christmas is highly cynical and something the government should be ashamed of," Ms King said. "This also raises serious questions about what the privatisation of Medibank will mean for premium increases in the future.," she said. This is an absolute slap in the face for Australian health consumers just two days before Christmas. Health fund NIB claimed it's larger than average rise was due to the fact its younger members were forced to subsidise older members in other health funds under an industry risk equalisation scheme. The funds forecast risk equalisation expense had contributed more than 1.5% to its 7.99% price increase, NIB chief executive Mark Fitzgibbon said. In financial year 2013, NIB paid out more than $1 billion in benefits to customers, including risk equalisation. That's an increase of more than 10% on the previous year," NIB chief executive officer Mark Fitzgibbon said. However, he said almost 70% of the funds customers would experience an increase of less than $3 per week from April next year. The last time health fund premiums rose by more than 6.2 per cent was in 2005. The nation's largest insurer Medibank will lift its premiums by 6.49 per cent and BUPA has been awarded a rise of 6.35 per cent. Consumers can compare the coverage and costs of individual hospital and extras insurance products at http://health.gov.au/internet/main/publishing.nsf/Content/privatehealth-average-premium-round