Bupa, Australia’s second-largest private health insurer, has apologised and agreed to pay a $35 million fine after being found guilty of misleading thousands of customers over a period of five years. The Australian Competition and Consumer Commission (ACCC) took legal action against Bupa, highlighting instances where the insurer incorrectly informed members that they were ineligible for benefits related to their claims.
The ACCC stated that Bupa misled customers by informing them they had no entitlement to private health insurance benefits for their entire claim, despite the potential for coverage. Additionally, Bupa acknowledged engaging in unconscionable conduct regarding how it assessed 388 Mixed Coverage Claims, particularly concerning hospital treatments involving multiple procedures. In such instances, if part of a treatment was covered by the policy while another part was not, Bupa wrongly rejected the entirety of the claim.
From May 2018 to August 2023, Bupa admitted to making misleading representations and engaging in deceptive conduct. There was also a nine-month period during which, from June 2020, the company ceased manually reviewing incorrectly rejected claims, despite knowing these reviews were necessary to ensure customers received their rightful benefits.
As part of its settlement with the ACCC, Bupa has committed to a joint request for the Federal Court to impose the $35 million fine, pending the court’s determination of its appropriateness. The insurer has initiated compensation efforts for affected clients, having already paid out $14.3 million associated with over 4,100 claims even before the court proceedings.
Bupa’s Asia Pacific chief executive, Nick Stone, expressed deep regret for the insurer’s actions, acknowledging the significant impact on customers, some of whom experienced delays or chose to forgo treatments they were partially entitled to under their policies. Stone emphasised that many individuals incurred substantial out-of-pocket expenses for treatments they should have received coverage for, while others felt compelled to upgrade their policies due to denied claims.
The ACCC chair, Gina Cass-Gottlieb, noted the extensive detriment suffered by Bupa’s members and described the situation as one that should never have occurred. Bupa has also made a court-enforceable commitment to maintain its remediation efforts, which the ACCC has accepted, aiming to restore trust and rectify the situation for its affected customers.