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  • The ACCC has launched legal proceedings against Medibank’s ahm Health Insurance branch
  • The financial watchdog alleges the health insurer denied customers benefits they were entitled to, forcing them to upgrade plans to receive reconstructive surgeries
  • Medibank is in the process of compensating affected customers
  • Medibank’s share price is down 1.52 per cent today, currently sitting at $3.56 apiece

This morning, the Australian Competition and Consumer Commission (ACCC) launched a legal case against Medibank.

The consumer watchdog claims the health insurer’s ahm branch denied customers services they were covered for when holding the Lite or Boost policies.

ACCC Chair Rod Sims said: “We will allege that Medibank incorrectly rejected claims or eligibility enquiries from over 800 members for benefits that they were entitled to and were paying for.”

The ACCC advised Medibank self-reported the incident and has already begun compensating the affected customers.

According to Medibank, 175 customers have so far been compensated, for a total of $745,691.

Senior Executive of ahm Jan O’Keefe said: “We apologise unreservedly to our customers who have been impacted by the error.”

It is alleged around 60 members upgraded their policies to access joint investigation and reconstruction procedures, which they were already entitled to.

Additionally, some members had an extended wait time before being able to access medical procedures.

“Medibank’s alleged misrepresentations had serious consequences for members requiring procedures including spinal surgery, pelvic surgery, hip surgery and knee reconstructions, which often cost thousands of dollars,” Rod added.

The watchdogs’ proceedings will specifically look at Medibank’s ahm Health Insurance denying customers covered benefits under Lite policies between February 2013 to July 2018 and Boost policies between February 2017 and July 2018.

Medibank’s share price has taken a slight hit today following the allegations, with shares currently down 1.52 per cent, trading at $3.56 apiece as of AEST 10:42 am.

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