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Our Future

Securing our future
rt Health + HCF = A Bright Future

Exploring an opportunity to merge with Australia’s largest not-for-profit mutual, HCF, is a positive and proactive step for rt health; one that can ensure that Australia’s oldest registered health fund identity continues long into the future. Through a carefully planned and proactive search process HCF was selected as the ideal future partner for rt health because of the strong alignment of values, culture and single minded member focus our two organisations share. With HCF, rt health faces a brighter future, where the things our members value most can be protected and invested in, and where we’ll be able to offer members access to even more services, facilities and many more benefits, all with the same great rt service they receive now.


In summary

The proposed merger is proactive and positive.
rt Health and HCF share core values and cultural alignment.
Members will receive more benefits and the same great service.
Find out more about HCF
The right partner for the future

The video message below from Chairman Alan Bardwell explains why a merger is being pursued, and why we have chosen HCF as the partner for the future of rt health.


The video message below from Chairman Alan Bardwell introduces HCF as the preferred partner for the future of rt health.

Important information you should know about the proposed rt health/HCF merger

1. What are some of the challenges facing the private health industry?

Several significant issues have combined to create a uniquely challenging set of circumstances. Nearly all members would be aware of the growing issues facing the private health insurance industry, such as the continuing decline in policyholder numbers, ageing population, and rising healthcare costs and premiums, all of which contribute to reduced affordability for members.

What are the big risks facing rt health?

rt health, while stable in the short term, is at risk from several factors that will impact its viability over the medium to long term, including:

  • Narrow margins
  • High operating expenses
  • Reduced participation in the fund, particularly among younger members.
  • A limited capacity to invest in growth, or in products and services.

The only way to fund these initiatives is through further increasing members’ contributions in an environment where affordability is already affecting so many members’ ability to retain their private health insurance.

Over the past 18 months, rt health has been focusing on taking every measure possible to mitigate these factors. These actions have strengthened the underlying capital position of the fund such that it has been able to enter into discussions with other private health funds from a confident position, and to invest considerable efforts in seeking out and selecting an ideal partner for the fund’s future.

2. Why has rt health chosen to do a merger?

The Board and the private health insurance regulator, APRA, remain concerned over the sustainability of the fund in the medium term. The Board has therefore proactively sought to find a merger partner while rt health is still in a position of being able to be selective as to which fund can offer its members the most appropriate and secure future. Under deteriorating or stressed conditions, we would lose the ability to make that choice for the benefit of members.

In a merger with the right partner, the rt health you know can be protected and strengthened. rt health members can be better protected by an entity that is well positioned to respond to difficult market conditions and the fund can continue to maintain its presence as a strong and stable not-for-profit provider in the private health insurance industry.

You will continue to receive the same trusted and personal service you always have, with the added benefit, that within a merged group, the fund will have greater capacity to evolve and improve products and services, technology and innovation for members.

The changes proposed are all about protecting enhancing the things that really matter for rt health members and they will make it possible for us to continue to offer you the most comprehensive, affordable health cover, now and into the future.

3. Why is HCF the preferred partner?

After many months of careful due diligence and consideration, in May 2020 the Board invited a select group of health funds to submit proposals that outlined what the future of the rt health, and the benefits to members would be, in partnership with them.

Of those initial proposals, the Board selected HCF’s as being the superior. In September, the rt health Board announced that it would work exclusively with HCF through the second round of the process to develop a final proposal that would see the two funds merge for the benefit of rt health members.

Having listened to members over many years about what it is that makes rt health great, there are several reasons why HCF is the Board’s preferred partner. These include:

  • HCF is a not-for-profit, mutual fund, just like rt health;
  • HCF has a genuine and single-minded focus on delivering value to its members;
  • HCF recognises, respects and values rt health’s 130-year history, its rail and transport industry heritage, and the vital role played within the communities it serves; and
  • HCF has scale through a larger balance sheet, which enables significantly more investment in new services for the benefit of members and an enhanced ability to withstand industry challenges.

HCF is one of the most highly capitalised private health funds in the industry, taking a long-term and prudent view for the benefits of its members. This is consistently reflected in its pricing and benefit changes. Surplus capital is available for reinvestment into the business, through opportunities including increased benefits to members and lower out-of-pocket costs, lower premium increases and greater premium stability, improved member access and convenience. HCF’s recent and substantial investment in its IT transformation will also deliver significant economies of scale and broader service benefits for rt health members.

HCF believes not-for-profit health funds provide a compelling and necessary alternative to for-profit funds. As Australia’s largest not-for-profit health fund, HCF believes it has an imperative to put the health of its members first and will continue to focus on delivering the best outcomes for members, now and in the future.

The process of working with HCF to finalise a proposal for the merger is still ongoing. When we have that final proposal we will be able to give you specific information about what a merger with HCF will mean for you. We will provide you with more details on the proposed merger in the coming weeks.

4. What's now happening with the proposed merger between rt health and HCF?

Discussions between rt health and HCF continue with both parties focusing on the benefits available for members, along with the long-term sustainability of rt health as the fund which serves the transport and energy industries. Members will be kept well informed of progress towards a potential merger.

2020 AGM Results