Private health insurance premiums are outstripping inflation and wage growth, as Australians find more cause for complaint with their policies.
A new Australian Competition and Consumer Commission report released on Monday found consumers paid $1 billion more in premiums in 2016/17 than the previous year, totalling more than $23 billion.
"Premium increases have been greater than inflation and wage growth in recent years," the ACCC found.
ACCC acting chair Delia Rickard said it was "very difficult" for consumers to properly compare and choose policies for their needs.
"Many are shocked when presented with expensive bills for medical services and products they thought they were covered for," she said.
The report shows consumers are shifting towards lower-cost policies with greater exclusions or a higher excess.
"Consumers are increasingly questioning whether the benefits of private health insurance offset the premium increases--a trend that should concern the industry," Ms Rickard said.
As at June 2017, 54.9 per cent of Australians held hospital or general health insurance cover - down 0.6 per cent from the year before.
For the fourth year running, complaints to the Private Health Insurance Ombudsman also shot up, to the tune of 30 per cent.
Health Minister Greg Hunt wants to make private health insurance simpler and more affordable.
The ACCC is calling on the private health insurance sector to make its products more consumer-friendly, with reliability and transparency key to doing so.
