Bupa, one of Australia’s largest health insurers, has been slapped with a hefty $35 million fine by the Australian Competition and Consumer Commission (ACCC) for misleading and deceptive conduct.
The watchdog found that Bupa had incorrectly rejected thousands of claims for hospital treatment where multiple procedures were performed, simply because part of the treatment was not covered by their policies.
This left customers thousands of dollars out of pocket, with some even delaying or cancelling medical treatment as a result.
What Went Wrong
Bupa admits that it did not manually review mixed coverage claims that had been automatically assessed as not having payable benefits.
This was due to a lack of clear instructions and training for staff handling mixed coverage claims, as well as poorly programmed auto-claim systems.
The ACCC chairwoman, Gina Cass-Gottlieb, slammed Bupa’s conduct, saying it denied certain members benefits they were entitled to under their private health insurance policies.
“Consumers purchase private health insurance to provide peace of mind, certainty of coverage, and the ability to choose where and when to undertake their procedures,” she said.
Consequences and Compensation
Bupa has already started paying compensation to affected customers, with $14.3 million paid out to around 4100 claims.
The company’s Asia Pacific chief executive, Nick Stone, apologized for the conduct, saying, “We are deeply sorry for failing to get things right for our customers and are saddened by the impact this has had on them and their families – this should never have happened.”
Bupa and the ACCC will jointly ask the Federal Court to approve the $35 million penalty.
The company has also promised to put in place measures to ensure this doesn’t happen again.