Information on the Scheme

In early 2008 the MBF Board recommended a $2.41 billion proposal from Bupa Australia to combine the businesses of the MBF Group and Bupa Australia Group (the “Scheme”).

On May 12 2008, Participating Contributors voted overwhelmingly to approve the Scheme at the Scheme Meeting. For more information about the results of the Scheme Meeting click here.

On May 14 2008, the Federal Court of Australia made orders approving the Scheme.

MBF converts to a company limited by shares

On 15 June 2008 MBF converted to a proprietary company limited by shares.

Implementation Date of the Scheme

On 16 June 2008 the Scheme was implemented. Entitlements were sent to Participating Contributors on 30 June 2008.

PHIAC approval of MBF’s conversion to for-profit

The Private Health Insurance Administration Council (PHIAC) approved MBF’s application to convert to being registered as a for-profit private health insurer. The date of effect of the conversion of MBF to a for profit private health insurer was 17 June 2008.

Update on Tax

A change has been made to the tax law relating to capital gains tax (CGT) treatment of policyholders of health insurers who receive cash or shares when their health insurer demutualises. The change takes effect from 1 July 2007 and applies to the demutualisation of MBF.

If you were not an Australian resident when the demutualisation of MBF took place, on 16 June 2008, the below information does not apply to you and you will need to seek your own tax advice or contact the Tax office directly to understand your individual position.

If you were an Australian resident when the demutualisation of MBF took place on 16 June 2008:

Under the new law any amounts you receive under the Scheme, including any amount you may receive from the residual pool in January 2009, are not subject to income tax and you do not need to include any amount you received under the Scheme when completing your 2007-08 tax return.

As previously advised t he ATO had agreed to allow you to lodge your 2007-08 tax return without including any capital gain arising from your Entitlement.

If you have lodged your 2007-08 tax return without including your cash payment then there is nothing further you need to do.

If you have lodged your 2007/2008 tax return and did include the receipt of your cash payment then you will need to discuss requesting an amendment to your tax return with your tax adviser or the ATO .

The ATO has provided information on its website and you can access this information by clicking here.

Residual Pool

As part of the Scheme, MBF retained $25 million from the $2.41 billion paid by BUPA Australia Holdings to deal with any Contributors who were unable to seek a review of their allocation prior to 21 May 2008. This is known as the Residual pool.

The balance of the Residual Pool that remained on 31 December 2008 was distributed to all Participants as a second and final payment under the Scheme on 12 January 2009, and should be received by Participants by 19 January 2009.

So if you received an Entitlement under the Scheme you should receive a second and final payment by 19 January 2009. If you do not receive the payment by this date please call 133 505.

You can view the payment or address details used for your second and final payment by clicking on the ‘View your Scheme details’.

Key Documents

• Chairman's letter [PDF, 55k]
• Information Memorandum [PDF, 3,843k]

Review Request Forms

The period for review of allocations under the Scheme has now closed and no further reviews under the Scheme can be considered.

You needed to have completed and submitted a Review Request Form by 5:00pm on 1 December 2008 to have your position reviewed. If you did not lodge a review request by this time you are unable to have your allocation reviewed.

If you lodged a review request prior to 1 December 2008 and have been advised by the Review Committee that you will receive an increase on your allocation, the additional amounts payable to you were paid with the distribution of the Residual pool on 12 January 2009.

If you have lodged a review request prior to 1 December 2008 and have not received a response you will need to call 133 505.

About Bupa Australia

Bupa Australia Health is the second largest private health insurer in Victoria and the largest in South Australia. Bupa Australia Health’s brands HBA and Mutual Community cover more than one million Australians and its health fund can be traced back for more than 70 years.

Bupa Australia Health is part of the Bupa Group, a global health and care organisation. The ultimate holding company of the Bupa Group has no shareholders and it is therefore able to reinvest its profits back into its businesses for the benefit of customers.