Analyzing Macroeconomic Factors Impacting Medibank Private Ltd

This report provides a comprehensive analysis of the macroeconomic factors affecting Medibank Private Ltd, utilizing the PESTEL framework. It delves into the political aspects such as Private Health Insurance Rebates and Lifetime Health Cover initiatives, highlighting their potential impact on Medibank's operations. The analysis also covers economic factors, noting Australia's favorable exchange rates and stable economic growth, which present opportunities for the company. Social aspects, including cultural variations and demographic shifts, are considered in relation to marketing strategies. Technological advancements in healthcare are discussed, emphasizing improved service delivery. Environmental concerns, such as climate change and the push for eco-friendly practices, are addressed. Finally, the report examines legal aspects, including discrimination legislation and minimum wage requirements, and their effects on Medibank's expenses and client behavior. The report concludes by referencing various sources that support the analysis of Medibank's operating environment and the macroeconomic challenges and opportunities it faces.

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ANALYSIS OF THE MACROECONOMIC FACTORS AFFECTING MEDIBANK
PRIVATE LTD
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Analysis of the Macroeconomic Factors Affecting Medibank Private Ltd
PESTEL Analysis
This analytical tool entails Political aspects, economic, social aspects, technological aspects,
environment as well as legal aspects that might affect Medibank Private Limited
macroeconomic environment (Fern Fort University 2018). Basically, PESTEL analysis offer
details information on the operating challenges the company would face in the prevalent
macroeconomic environment other than the competitive forces. In other words, PESTEL
analysis is important in analysing Medibank macroeconomic factors since it would assist the
company in assessing variations in macroeconomic environment aspects and how these
aspects could have direct impact on its as well as other players within insurance sector.
Furthermore, PESTEL analysis is also important for Medibank Limited to analyse some of
the macroeconomic environment which is more likely to shape its competitive and strategy
landscape. It offers details information on operating challenges Medibank is more likely to
face in the prevalent macroeconomic setting other than the competitive forces.
Political Aspects
Medibank operates in the insurance sector in over dozen nations and expose itself to
numerous types of the political system and political environmental risks (Medibank 2015). In
accomplishing success in the dynamic insurance sector actors numerous nations usually entail
diversifying systematic risks of the political environment in which the company operates in
(IBISWorld 2017). Medibank face some political impact risks whereby the varying tax
legislation, employment regulation and consumer protection force the company to adjust in
order to take advantage of the government expenditures (Fern Fort University 2018).

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The company would be affected by Private Health Insurance Rebates which is based on the
Tier System to determines the organization eligible for what to rebate based on their income
(Financial Review 2018). The Australian government move to introduce Lifetime Health
Cover by encouraging individuals to join the private health insurance earlier is also a move
that is likely to affect Medibank operations significantly (IBISWorld 2017). This move would
result in increased sales over the period. Another political aspect likely to affect Medibank is
foundation of Medicare Surcharge Levy which mostly aimed at encouraging high income
earners to acquire private health insurance instead of rely on public services. This move
would result in increased sales for Medibank.
Economic Aspects
The exchange rate for euros against other currency are a bit favourable in Australia, this
makes health insurance investment attractive option for different investors especially foreign
investors who are very keen to avoid losing any amount of cash in the exchange transaction
(IBISWorld 2017). With the high economic growth rate experienced in Australia, there is
relatively low level of risk for Medibank operating within the Australian economy since it
boasts constantly strong GDP growth, rising exchange rates, stable interest rates, low
inflation rate as well as significantly high employment (Fern Fort University 2018). In fact,
the relatively high level of employment means that Medibank is more likely to make
significantly huge sales in the country (Choice 2018). With increase in the aging population,
there is more need for medical services. This is likely to result in increased insurers in the
company and in turn increased sales.
Social Aspects

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The manner of doing different things as well as society’s culture is said to greatly affect
culture of a specific firm. Shared attitudes and beliefs play significant role on how marketers
at the Medibank would understand clients of a specific market as well as how they design
marketing messages for the insurance sector clients (Medibank 2015).
Variation in public values and demographics also affect Medibank operations within
Australia (Fern Fort University 2018). Medibank should be knowledgeable enough on
community it serves in order to avoid any chance of violating the widespread norms and
values.
Technological Advancement Aspects
There have been positive changes in technology advancement in Australia. The changes have
resulted in improved healthcare provision across the country. Therefore, development in the
medical devices across Australia has permitted patients received better healthcare (Financial
Review 2018).
In fact, it has enabled Medibank to offer better healthcare services for its clients all across the
country (Medibank 2018). In addition, there has been a variation in the app development
which is said to permit different patients or clients of Medibank to get healthcare faster than
before (Fern Fort University 2018).
Environment Aspects
Variations in the temperature could affect numerous sectors including insurance, health and
so forth. Therefore, with major climate changes taking place in Australia as a result of the

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global warming as well as with greater environmental awareness in the country, this aspect is
becoming a crucial issue for Medibank (Fern Fort University 2018).
In fact, the growing requirement towards more environmentally friendly processes and
products could affect demand patterns for Medibank products and services and could also
creating a business opportunity for the same.
Legal Aspects
With introduction of disability discrimination and age discrimination legislature, there is
need for Medibank to ensure none of these issues are ignored (Medibank 2015). In fact, with
increase minimum wage as well as greater requirements for all firms to recycle, there
legislation is more likely to affect, Medibank expenses and cost incurred in offering or
producing its products in Australia (Fern Fort University 2018). Besides, they are likely to
affect likelihood of the clients in purchasing goods or utilizing services.

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References
Choice (2018), Compare Medibank health insurance: Available from:
https://www.choice.com.au/money/insurance/health/funds/medibank-private [Accessed at
27th May 2018]
Fern Fort University (2018), Medibank Private Limited PESTEL & Environment Analysis:
Available from: http://fernfortuniversity.com/term-papers/pestel/nyse4/4970-medibank-
private-limited.php [Accessed at 27th May 2018]
Financial Review (2018), Medibank at mercy of structural headwinds: Available from:
http://www.afr.com/business/banking-and-finance/financial-services/bull-and-bears-
medibank-at-mercy-of-structural-headwinds-20180202-h0sesb [Accessed at 27th May 2018]
IBISWorld (2017), Health Insurance - Australia Market Research Report: Available from:
https://www.ibisworld.com.au/industry-trends/market-research-reports/financial-insurance-
services/health-insurance.html [Accessed at 27th May 2018]
Medibank (2018), Medibank Operating environment: Available from:
https://www.medibank.com.au/annual-review/operating-environment/ [Accessed at 27th May
2018]
Medibank (2015), Medibank Private Limited annual report 2015: Available from:
http://www.annualreports.com/HostedData/AnnualReportArchive/M/ASX_MPL_2015.pdf
[Accessed at 27th May 2018]

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