Health Minister Mark Butler has told private health insurers to rethink their push for annual premium rises of 6 per cent or more and warned funds to stop exploiting a loophole that lets them secretly charge members hundreds of dollars extra for new products.

With insurers under pressure from hospitals to give them more funding, Mr Butler said he would consider legislative options outlawing the widespread practice of funds retiring cheaper gold-tier products and replacing them with almost identical ones at a higher cost.