The government has begun preparing Australian health insurance provider Medibank Private for sale as it attempts to make budget cuts.
The potential $4 billion sale of Medibank is due to be underway before Christmas after advisers were appointed to perform a scoping study.
Reviving a sale process that was put on hold in 2007 by former prime minister John Howard, the scoping study will prepare Medibank for either a trade sale or public listing, clearing the way for investment banks to value the company.
The decision as to whether Medibank Private should be floated on the sharemarket or sold in a trade sale will be made by the expert advisors performing the study.
The sale of Medibank may only be the first step in a major overhaul of public spending as a Commission of Audit was recently formed to identify ways to scrap agencies, merge departments or sell off more assets.
However, the government has assured the public that the audit is seeking ways of spending money more efficiently, rather than making large cuts to important sectors.
Finance Minister Mathias Cormann said the government was "not going to cut spending to health and education" as a result of the audit.
While the commitment is to maintain overall spending in those areas, the audit commission may recommend introducing measures such as 'co-payments' or fees for health services.
This means Australians could also be asked to pay more for their health services as the idea of "user-charging" and "co-payments" for government programs is explicitly supported in the terms of the audit.
If you are concerned on the affects the sale of Medibank Private will have on your health insurance, speak with the team at HICA today.
HICA can offer an obligation-free health insurance comparison to help you choose a provider and policy that suits your needs or budget.