ACCC slams Medibank
June 17, 2016
The Australian Competition and
Consumer Commission (ACCC)
has instituted proceedings in the
Federal Court against Medibank
Private alleging the company
has made false or misleading
representations and engaged in
unconscionable conduct.
The allegations relate to
Medibank’s failure to notify
members regarding its decision to
limit benefits paid to members for
in-hospital pathology and radiology
services.
The ACCC alleges that Medibank
did not provide members with
any advance notice of the change
despite previously representing
that it would do so, as well as
adopting a strategy of containing
communications about the action
and only commenting reactively.
Medibank said it has been
working co-operatively with the
ACCC and Medibank members
should contact them if they have
concerns.
“Consumers are entitled to
expect that they will be informed
in advance of important changes
to their private health insurance
cover, as these changes can have
significant financial consequences
at a time when consumers may be
vulnerable,” ACCC chairman Rod
Sims said.
MEANWHILE the ACCC has
also taken action to protect the
competitive environment for
pathology services in Queensland
by accepting court enforceable
divestiture undertakings from
Primary Health Care and
Healthscope.
After extensive investigations by
the ACCC as to whether Primary’s
acquisition of Healthscope’s
pathology assets in Queensland,
which occurred in 2015, breached
section 50 of the Competition
and Consumer Act 2010, the
arrangement was found to be
anticompetitive and the divestiture
therefore will effectively reverse
the move.
The package of divestiture
assets, including more than
70 collection centres, will be
sold to Medlab Pathology, an
experienced pathology provider
based in Sydney, to enable it to
establish a competitive presence in
Queensland.
“Primary and Healthscope
completed the transaction without
notifying the ACCC, despite being
on notice that the ACCC would have
serious concerns about the likely
competitive effect,” Sims said.
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