Federal health minister Sussan Ley insists the government won't be heading down the same private health insurance path as the US and UK.
But she does have the "junk" products of some insurers in her sights.
The government wants to hear what Australians have to say about private health insurance, launching an online survey on Sunday.
Labor has described some of the questions as push polling designed to lay the ground for differential pricing that may disadvantage young women, smokers, the aged and those with health risks.
It has accused the government of trying to Americanise private health cover, a claim rejected by Ms Ley.
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"We are not moving to the US style of so-called managed care, we are not moving to the UK system of risk-based insurance," she said on Monday.
The government has been accused of pandering to insurers by allowing them to penalise people most likely to claim back on policies.
But Ms Ley argues it is not about "the sticks, it's about the carrots" and any changes to lifetime community ratings would not apply to existing policy holders.
The minister said she had yet to meet a person happy with his or her private health insurance, citing figures showing 500,000 policies had been dumped or downgraded during the past 12 months.
As at June 30, 11.3 million Australians were covered by hospital treatment cover and 13.3 million had some form of general treatment cover.
The government contributed $5.8 billion to private cover costs, by way of a 30 per cent rebate in 2014-2015.
Opposition health spokeswoman Catherine King took aim at the minister for using the emotive example of smoking to highlight a "ridiculous" survey.
"When you start to say that these people should pay more where do you stop?"
"Is she suggesting that women should pay more because you bear children?"
