Health insurance premiums to rise by 5pc

The federal government says it is between two to seven private insurers to stop forcing unreasonable increases for their customers.

Health Minister Tanya Plibersek says 24 of 34 insurers in the country was asked to share their applications again and evidence to justify the proposed increase.

"I received very detailed actuarial advice on the progress they made and I decided on the basis of actuarial advice that the increases are not justified," she said.

Ms Plibersek says it is the lowest annual increase in four years and is a half percentage point lower than the increase last year.

"The increases are in fact lower than the increase in the cost of providing health services from doctors and hospitals," she said.

She says that individual insurers to inform their customers about the new rates in the coming weeks.

The federal opposition health spokesman Peter Dutton says that people will downgrade their health insurance as a result of today's announcement.

Mr Dutton says the increase comes on the heels of the push by the government to the number of people eligible for private health insurance rebate to be cut, and some people are hit twice.

"There are increases in the cost of providing medical services, everyone accepts that, but the poison is that it comes on the back of the government whacking families to increase their private health insurance premiums because they cut the 30 percent discount, "he said.

But Ms Plibersek says she does not think the increase will be an exodus from the industry to provoke.

"It increases last year and the year before and the year before were in fact higher and the people kept their private health insurance, and indeed we have seen tens of thousands of private health insurance with you, even in the last quarter of last year," she said .


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