Medibank sued over denial claims
The ACCC is taking Medibank Private to court for allegedly denying benefits to over 800 members that they were entitled to claim.
The competition regulator has instituted proceedings in the Federal Court, alleging that Medibank made false representations about benefits covered by its health insurance policies, in breach of the Australian Consumer Law.
The ACCC alleges that Medibank falsely represented to members holding “lite” or “boost” policies, who were making claims or enquiries, that they were not entitled to cover for joint investigations or reconstruction procedures, when in fact their policies covered these procedures.
“We will allege that Medibank incorrectly rejected claims or eligibility enquiries from over 800 members for benefits that they were entitled to and were paying for,” ACCC Chair Rod Sims said.
“As part of our case, we estimate about 60 members needlessly upgraded their policies so they could access the joint investigation and reconstruction procedures they were already entitled to under their existing, cheaper insurance policies.
“In some cases, it is alleged that members who upgraded their policies were also required to serve a further waiting period to access these procedures.
“Medibank’s alleged misrepresentations had serious consequences for members requiring procedures including spinal surgery, pelvic surgery, hip surgery and knee reconstructions, which often cost thousands of dollars.
“Some members were forced to delay surgery due to high out-of-pocket costs for these procedures and to seek alternative remedies to manage pain, when they were in fact entitled to insurance cover,” Mr Sims said.
The ACCC’s proceedings against Medibank involve alleged misrepresentations in relation to ahm ‘lite’ policies from February 2013 to July 2018, and ahm ‘boost’ polices from February 2017 to July 2018.
Medibank self-reported this conduct to the ACCC and has begun compensating affected members.
The ACCC is seeking penalties, consumer redress, declarations, injunctions, publication orders, the implementation of a compliance program and costs.