Bupa Fined $35 Million for Misleading Thousands of Customers Over Health Insurance Benefits

Introduction
Private health insurer Bupa has been fined $35 million after the Federal Court found it misled thousands of customers, hospitals and medical providers about their entitlement to health insurance benefits over more than five years. The penalty follows findings that Bupa’s conduct caused financial harm, emotional distress and, in some cases, delayed or foregone medical treatment.

Details of the Misconduct
The Federal Court ruled that between May 2018 and August 2023, Bupa incorrectly told members they were not entitled to benefits for mixed coverage and uncategorised item claims, when in fact they were eligible.

More than 4,100 claims were affected by conduct the court found to be false, misleading, deceptive and unconscionable.

The affected claims largely involved hospital procedures where:

• two or more treatments were performed at the same time
• only part of the treatment was covered under a member’s policy

As a result, not only were customers denied benefits, but hospitals and medical providers were also left unpaid for services they were entitled to receive.

Regulatory Action and Court Orders
The Australian Competition and Consumer Commission (ACCC) commenced court action against Bupa in June 2025.

On Thursday, the Federal Court ordered Bupa to:

• pay a $35 million civil penalty
• comply with a five-year injunction prohibiting further breaches
• continue remediation of affected customers and providers

To date, Bupa has repaid approximately $14.3 million to customers in relation to the impacted claims.

Impact on Customers
ACCC Deputy Chair Catriona Lowe described the conduct as “extremely serious”, noting that the consequences extended beyond financial loss.

“Some of Bupa’s members decided to cancel, delay or forego necessary treatment, resulting in potential medical risks or complications, because they were incorrectly told they were not entitled to health insurance benefits,” she said.

“Private health insurance can be a significant expense for consumers, and people rightly expect to receive the level of coverage they pay for.”

The court accepted evidence that customers experienced pain, suffering and emotional distress as a direct result of being denied benefits they were lawfully entitled to receive.

Company Response
Bupa accepted the court’s decision and issued an apology to affected customers.

In a statement, the company said:
“We remain deeply sorry for these errors and have apologised to our affected customers for the impact this has had on them and their families.”

The insurer said it has implemented changes to systems and processes to prevent similar issues from occurring in future.

Conclusion
The $35 million penalty is one of the largest consumer law fines imposed on a private health insurer in Australia and serves as a warning to the industry about the consequences of misleading conduct. Regulators say the case underscores the importance of transparency and accuracy in health insurance claims, where misinformation can directly affect patient health and wellbeing.