But CEO of the Private Health Insurance Administration Council (PHIAC) Shaun Gath is not concerned about the financial stability of any of the funds.
"Overall, we are happy that the industry is in good shape and that any problems that have been identified can be managed in the normal course of prudential supervision,'' he told a Senate budget estimates hearing in Canberra today.
"The overall position is that the investment environment within the funds does not pose any concern to us in terms of the ongoing prudential safety of any of the funds.''
Shadow parliamentary secretary for health administration, Senator Mathias Cormann, asked Mr Gath whether or not he could guarantee none of the health funds was exposed to institutions crippled by US sub-prime debt or short selling or hedging.
"Well, I am not sure that I can give that assurance because there's a large number of funds and a vast number of investments,'' Mr Gath said.
"What I can say to you is that our present assessment is that the industry remains on a sound capital management footing, all insurance health funds are in compliance with prudential standards and the industry capital position remains, and is projected to remain, in compliance.
"If you are asking me, have some of the funds made bad investments, the answer is yes. Is it a concern to us in a prudential point of view, the answer is no.''
The council will publish a report next month detailing the individual financial positions of funds.
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