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Medibank Private posts record profit

26 September 2011 - 5:33pm

Government-owned private health insurance provider Medibank Private has recorded $5 billion in revenue for the 2010-11 financial year.

The before-tax profit of $428 million represents a 13 per cent increase from the 12 months prior.

Acting health minister Mark Butler has used the news to highlight the strength of the private health sector.

Butler tells Nine MSN: "Record profits and record memberships point to an industry that's in very good shape."

"It's just not tenable for taxpayers to foot the bill for the private health insurance of millionaires," referring to the government's plan to means test the private health cover rebate.

The company has recently consolidated a total of four health services companies into a division it calls Medibank Health Solutions.

Managing director George Savvides says that members have received a total of $3.6 billion in paid health benefits, which amounts to an increase over last year of 6.7 per cent.

He also cites four consecutive years of premiums at levels below the industry average as a contributor to their success.

The record profit announcement comes ahead of two key potential changes to the private sector - a means test for the cover rebate and a potential increase of the Medicare Levy.