The Australian Medical Association (“AMA”) has welcomed the Australian Competition and Consumer Commission’s (“ACCC”) decision to commence legal action in the Federal Court against Medibank Private for alleged misleading and deceptive conduct under the Australian Consumer Law.

The ACCC alleges Medibank Private deliberately failed to notify policy holders of changes to their policies relating to in-hospital radiology and pathology services after it calculated that the cuts may result in members switching private health insurers; potentially causing its newly floated share price to plummet.  The cuts resulted in policy holders incurring average out-of-pocket expenses of $151 for pathology services and $83 for radiology services.  AMA President, Dr Michael Gannon, explained that the AMA has long been concerned by private health insurers changing their policies without notifying policy holders.  He said it is high time private health insurers are held accountable.  Medibank Private is set to contest the claims.

To view the AMA’s media release, click here.