The Department of Defence is facing questions over a $3.4 billion contract with Bupa to supply health services for Australian Defence Force personnel, just months after a federal court penalised the insurance giant for deceptive conduct.

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Bupa, one of the largest private health insurers in Australia, agreed to pay $35 million in penalties in June after it admitted to misleading thousands of customers about their private health insurance benefits over a five-year period.

The company, which took over a six-year contract to provide health care for Defence bases across Australia in 20

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