ACCC not to oppose BUPA/MBF health insurance merger

The Australian Competition and Consumer Commission will not intervene in the proposed merger of BUPA Australia Pty Ltd and MBF Australia Limited, ACCC Chairman, Mr Graeme Samuel, said today.

BUPA and MBF are both registered providers of private health insurance which have a presence in every Australian state and territory. In South Australia and the Northern Territory BUPA operates under the name Mutual Community and in all other states and territories BUPA operates under the name HBA.

"The ACCC conducted a comprehensive review of the proposed merger including extensive market inquiries with interested parties. The ACCC carefully considered the likely effects of the proposed merger on the supply of private health insurance to consumers and on the acquisition of services from private hospitals.

"The ACCC paid particular attention to potential effects in the supply of private health insurance to South Australian consumers due to BUPA's strong position in that state. The ACCC also investigated concerns that the proposed merger may enhance BUPA's bargaining position in negotiations with private hospitals in South Australia.

"In reaching its decision the ACCC found that competition from a number of competing private health insurance providers in South Australia would be likely to continue to constrain BUPA in the foreseeable future.

"In addition market inquiries indicated it is unlikely that BUPA would have market power with respect to the acquisition of private hospital services in South Australia as a result of the proposed merger. In reaching this conclusion the ACCC had regard to constraints imposed on BUPA by private hospitals and the presence of competing health funds."

The basis upon which the ACCC reached its decision will be set out in a Public Competition Assessment which will be available in due course on the ACCC's website, under Mergers.