Medibank private snares major share of market
In less than two years since its separation with the Health Insurance Commission, Medibank Private - Australia's largest and only national private health insurance fund - has reached the pinnacle of its short history.
It has secured an astonishing 30.8 per cent of Australia's private health insurance market for hospital products. Medibank Private now provides health insurance cover to close on 3 million Australians, up from a 2 million high in November.
According to Medibank Private managing director, Mark Burrowes, this phenomenal growth is unsurpassed in the history of Medibank Private and the industry.
"Not only that, but our performance relative to our competitors has been extraordinary."
According to the latest Private Health Insurance Administration Council (PHIAC) figures, Medibank Private now holds sway in NSW with a 25 per cent share of the market, having surpassed MBF as the No 1 fund. MBF now has a 22.4 per cent share in that state.
Medibank Private has also increased its market share in every other state.
In Tasmania, the fund's market share has increased by 6.7 per cent - bringing its share of that market to 34.2 per cent - while in Queensland it has increased by 4.2 per cent, garnering Medibank Private a 36.2 per cent in that state.
The fund has also secured an additional 4.3 per cent market share in SA (now 20.5 per cent), and 3 per cent in WA (now 20.7 per cent).
Mr Burrowes says although Medibank Private secured smaller additional market share in Victoria, the organisation already dominates in that market with a 42 per cent share pre-LHC. "Similarly while our market share increase in NT was marginal, we still command almost 50 per cent market share in the Top End."
While membership growth strengthened significantly in January, the April-June period proved truly historic for Medibank Private. "Of the 789,858 contributors who took out private hospital insurance in that period, an astonishing 42.6 per cent joined Medibank Private.
"I do not believe that any fund has ever enjoyed this level of growth in such a short period of time," he says.
Mr Burrowes attributes the funds' astonishing success to its rapid and innovative response to the Federal Government's Lifetime Health Cover (LHC) initiative.
"Back in October we undertook a review of our strategic corporate plan. We decided as a consequence, to focus our corporate energy and gear up our resources in response to LHC. Other programs would simply have to wait.
"We immediately set about expanding our services for joining new members to include the Internet, kiosks in shopping centres. We also extended our operating hours, adding additional staff to our call centres and retail outlets.
"We also focused on launching a new range of innovative, value for money products. Our Package Plus product sold extraordinarily well which indicates that it was not only hospital cover that many new purchasers were looking for - the vast majority of our new members bought both hospital and ancillary."
Mr Burrowes said that throughout the period from January to June, Medibank Private ran an intensive and prominent marketing campaign to build its brand and market awareness of LHC and Medibank Private product offerings.
"These decisions were strengthened by a corporate restructuring early this year to better align our structures and strategy. Around 50 per cent of the management team are now new and vibrant entrants to the industry and have brought with them wide commercial experience.
"These strategic decisions have paid off - effectively setting us apart from our competitors," he says.