Govt urged to drop private health changes

The head of one of Australia's biggest private health insurers has made a last-ditch plea for the federal government to dump its controversial reforms for the industry.

Bupa chief executive Richard Bowden's call came as he revealed the insurance giant would merge its MBF, HBA and Mutual Community health insurance companies under the one banner.

Mr Bowden said while there was uncertainty about whether the proposed laws would pass parliament, he believed means-testing the 30 per cent private health insurance rebate and changing the Medicare surcharge were bad policies and would force up premiums.

Asked if he would urge Health Minister Nicola Roxon to abandon the plans, which are expected to be reintroduced for debate in parliament soon, Mr Bowden said "Absolutely."

"We don't think the policy is a good one," he said.

"Any change to so-called high-income earners ... if those people drop their cover or reduce their cover, whatever happens it will have an impact on really the people who need insurance the most and they are often low-income earners or they are ill.

"We are talking about price rises varying from as low as 10 per cent up to 43 per cent and that's on top of whatever underlying price increase happens."

Under the government's plans, people earning more than $80,000 and families on $160,000 would no longer qualify for the 30 per cent rebate from January next year.

The Medicare surcharge would also rise to 1.5 per cent from one per cent of taxable income for the richest Australians.

The government has already twice failed to get the laws through parliament.

It still faces a tough battle to win support, with the opposition claiming people would flee private health insurance and put extra pressure on the public hospital system.

Some key independent MPs remain undecided about whether to vote against the changes, while the Greens are opposed to the proposed change to the Medicare surcharge, saying it would discourage people from taking out private health insurance.

The government argues the changes will save it $2.8 billion over four years and make the distribution of taxpayer money fairer.

Meanwhile, Bupa is about to remove some of the best-known brands in Australian healthcare by merging its MBF, HBA and Mutual Community health insurance companies under one banner.

The three brands will all be known as Bupa from next month.

Mr Bowden said there would be no job losses as a result of the changes, which he said would help make the British-based insurer a household name in Australia and easier for customers to access its services.

"We certainly recognise our customers have a strong affinity with these brands and we want to build as close if not better affinity with the Bupa brand going forward," he said.

People with MBF, HBA and Mutual Community policies will be able to retain their policies unless they decide to switch to a Bupa-branded one.

Bupa, which has 3.3 million health insurance customers in Australia, bought MBF in 2008 after acquiring HBA and Mutual Community in 2002.