Should your age determine how much you pay for private health insurance?
Policy experts from the Grattan Institute believe hitching insurance premiums to age could encourage more young people to take out cover and save the troubled industry from a "death spiral".
"The system faces a death spiral - younger and healthier consumers get a bad deal," the institute said in a report published on Wednesday.
"So they're dropping their insurance, which means premiums need to rise, so even more young and healthy people drop out, and the cycle continues."
The institute warns consumers are putting themselves at risk by taking out policies with less cover as insurance becomes more expensive.
It has suggested allowing funds to charge Australians under 55 a rate based on their age and risk rating, and applying a flat rate to everyone over that age.
The Australian Medical Association agreed action must be taken to encourage young people to buy health insurance, and said the government could do more to drive down prices.
President Tony Bartone stopped short of endorsing age-based insurance premiums, but called for a review of lifetime health cover loading.
Such loading aims to reward young people who buy hospital cover by waiving an extra fee.
Dr Bartone said the current model fails to take into account that people are staying at school longer, starting families later and facing more intense mortgage pressures.
"The start age for lifetime health cover is supposed to be a signal to get into insurance," he said during a speech to the National Press Club on Wednesday.
"It works if people can afford to get in at that point.
"We think that it's now at a point of locking younger people out."
But industry groups have lashed out at the Grattan Institute for its plan, arguing its proposed overhaul would mean more expensive insurance for older Australians.
Australian Private Hospitals Association chief executive Michael Roff dismissed the suggestion as "complex and convoluted" and damaging to the industry.
He said deregulated premiums would see younger people with chronic or pre-existing conditions priced out of the market.
The Grattan Institute also suggests tax subsidies for extras policies be scrapped, with the money used to fund larger hospital insurance rebates and public dental care.
It believes rebates for hospital insurance should be increased for younger Australians and decreased for people aged over 65.
Australian Associated Press