Medibank Expands Health Network with $159M Better Medical Acquisition

About Medibank Private Ltd

Medibank Private Limited (ASX: MPL), headquartered in Melbourne, is Australia’s largest private health insurer with over 4 million resident and non-resident policyholders. Beyond its core insurance business, Medibank has spent recent years transforming into a health-services organisation offering preventative care, digital health platforms and primary-care networks under its Amplar Health brand. The group’s dual-brand model (Medibank and ahm) supports a broad customer base and creates opportunities to branch into wellness, home care and virtual services.

By announcing the acquisition of Better Medical, Medibank is deploying capital to deepen its role in the primary-care sector, reinforcing its strategy to integrate care, improve outcomes and reduce costs for both customers and the broader health system. CEO David Koczkar described the move as “an important step in our transformation from health insurer to health partner”, emphasising the potential to deliver greater value through closer control of the care pathway.

Transaction Overview and Rationale

Medibank’s acquisition of Better Medical involves payment of approximately A$159 million for a well-established network of 61 GP and allied-health clinics. Better Medical operates across Victoria, Queensland and South Australia, bringing scale to Medibank’s primary-care ambitions. The current business model of Better Medical includes in-clinic GP services, allied-health support, minor procedures and diagnostics, aligned with Medibank’s focus on prevention and community-based care.

The strategic rationale behind this move is multi-faceted. First, the acquisition gives Medibank direct access to primary-care touchpoints, enabling the insurer to engage customers earlier in their health-journey, embed loyalty and provide differentiated services. Second, by integrating Better Medical into its digital-health ecosystem (including its Live Better rewards and Amplar Health platforms), Medibank can drive cross-selling, increase retention and build higher-margin services beyond traditional insurance. Third, the acquisition supports cost-management objectives: by diverting care to lower-cost, community-based settings and leveraging data analytics and virtual health monitoring, Medibank aims to manage claims inflation and drive improved health outcomes.

The acquisition also aligns with Medibank’s FY30 ambitions: to engage around 10 million people in health and wellbeing and to grow the Medibank Health segment’s earnings beyond A$200 million. The Better Medical network becomes a critical asset in achieving these objectives by expanding the reach of in-person and virtual services and accelerating the shift from reactive to proactive care.

Integration and Implementation

Medibank plans an integration roadmap to ensure the newly acquired clinics become part of the Amplar Health network while retaining local leadership and operational continuity. The strategy will focus on onboarding Better Medical into Medibank’s digital platforms, standardising data flows, enhancing patient engagement via telehealth and building multi-disciplinary care teams. Integrating the clinic network with Medibank’s existing channels will enable deeper analytics, personalised health management and referral flows into virtual-care, home care and chronic-disease programs.

Operationally, Medibank expects to capture efficiency synergies through consolidated IT systems, joint purchasing, aligned clinical protocols and the extension of the Live Better rewards ecosystem into primary-care settings. While regulatory approvals are outstanding, management has indicated the acquisition is likely to be earnings accretive by mid-2026, once integration milestones are achieved and growth initiatives begin to lift revenue.

The Better Medical network’s geographic spread complements Medibank’s existing national footprint and strengthens its regional presence — particularly in Queensland and South Australia, where Medibank’s clinic and virtual-care rollout is accelerating. As part of the transformation to a health-services organisation, Medibank will use this expanded infrastructure to deliver both insured and non-insured care, amplify member value and engage in more integrated patient-journeys.

Market and Sector Implications

Australia’s health-insurance and primary-care sectors are undergoing significant change, driven by rising chronic-disease burden, consumer demand for convenience and telehealth, and policy focus on prevention and community-based care. Within this context, insurers that can extend their offering beyond legacy cover-models into care delivery, digital platforms and full-journey health services are better positioned for growth.

Medibank’s move into primary care is emblematic of this shift. By acquiring Better Medical, the company not only competes in the insurance market but also positions itself as a provider of care, aligning interests across prevention, treatment and management. This builds a stronger value proposition in the face of cost pressures — particularly as hospitals and specialty care face increasing demand and resource constraints.

Furthermore, Medibank’s investment sets a precedent for vertical integration within the health ecosystem — blending insurance and care delivery under one umbrella. The acquisition also broadens Medibank’s addressable market into higher-growth segments such as virtual health, allied services and chronic-disease management — areas with higher margins than traditional insurance products.

Outlook and Capital Management

Medibank has confirmed it will fund the acquisition through existing capacity and carefully manage capital deployment so as not to impair its insurance business. The company continues to emphasise dividend sustainability and balance-sheet strength while investing in growth. Given the scale of the Better Medical network and the potential synergies, analysts expect the acquisition to enhance Medibank’s earnings-per-share progression from FY26 onwards.

Management expects the expanded primary-care footprint to begin contributing materially by mid-2026, and to accelerate engagement across Medibank’s health-services segments. With the acquisition in place, Medibank is well placed to pursue further opportunities in virtual care, home-hospital services and wellness programs, all of which support its vision of doubling health-engagement and moving beyond insurance to integrated care.

Conclusion

Medibank’s acquisition of Better Medical represents a strategic leap in its transformation from a traditional insurer into a full-scale health services company. The network of 61 clinics will enhance Medibank’s ability to deliver value through prevention, primary care and digital health, while supporting its long-term ambition to engage more customers and grow higher-margin health-services earnings. As the health sector evolves, Medibank’s expanded capability and vision position it to deliver both better customer outcomes and shareholder value for years to come.