Allegations from the competition watchdog suggest NIB went one step further by actively asking doctors not to contact patients about the changes, in behaviour it recognises as "unconscionable".
Customers affected by the changes held one of 10 NIB policies, which they believed covered certain eye procedures between June 2011 and October 2016. NIB made representations that these customers wouldn't incur any out-of-pocket expenses under NIB's MediGap Scheme.
But an abrupt change to NIB's MediGap scheme in 2015 saw these eye procedures lose coverage, causing paying members to foot the bill.
The ACCC alleges customers weren't notified of the change in policy, and that it was reasonable for them to continue to expect coverage.
NIB management recognised customers should be informed, claims the ACCC, when it identified 400 members who had received two or more eye procedures in the previous financial year. Management was quoted as saying it "probably ought to proactively communicate" the changes to these members.
The procedures in question are common among the elderly, who would require them often to prevent further loss of sight.
The ACCC also alleges NIB discouraged hospitals and doctors from informing customers about the change.
A doctor acting from Newcastle Eye Hospital sent a letter to his patients informing them of the change and their rights to move to another insurer. NIB contacted the hospital and asked for a commitment that its doctors would not speak about the MediGap changes, to both patients belonging to NIB and the media.
Failing to let consumers know of a change in policy can leave them with a heavy financial burden, says Rod Sims, chair of the ACCC.
"These changes can result in very large financial consequences at a time when consumers are at their most vulnerable.
"Insurers should not expect consumers to bear the responsibility of making independent enquiries to find out about important changes made unilaterally by insurers."
NIB claims the changes helped improve clinical practices, before rejecting the ACCC's allegations.
"NIB...will strenuously defend the claims made by the ACCC in the Federal Court.
"One of [the] objectives behind the limited changes made to MediGap was principally about improved clinical practice. As this matter is now before the Federal Court, we are unable to make any further comment on the allegations."
The ACCC alleges NIB contravened the rights of Australian consumers by engaging in misleading or deceptive conduct, unconscionable conduct and making false or misleading representations.
It is seeking declarations, pecuniary penalties, injunctions, findings of fact, compliance program orders, corrective notices and costs.
The representations are alleged to have been made by NIB in relation to the following 10 policies:
- Basic Plus
- Family Basic Saver
- Family Plus
- Hospital Plus
- Just Hospital
- Mid Plus
- Premier Plus
- Top Cover
- Young at Heart Mid
- Young at Heart Top