My health insurance premium is too much to bear

It’s April 1 and in Australia the health insurance companies are playing the biggest April fool joke of all. Every year

It’s April 1 and in Australia the health insurance companies are playing the biggest April fool joke of all. Every year this day is the one private health insurers hit those who buy insurance with their annual premium.

Over the last ten years health insurance companies have raised the premiums an average of 72 per cent, which is almost three times the rate of inflation. However, there has also been a rise in the number of health insurance providers around meaning opportunities to find affordable insurance tailored to your personal needs is also more available.

The average increase this year is about 5.59 per cent per annum according to iSelect spokeswoman Laura Crowden, with insurance companies increasing at between 3.76 per cent and 8.95 per cent per annum.

While that’s actually lower than previous years, it’s still much higher than the Consumer Price Index for the year and roughly half a million insured Australians are now considering walking away because the cost of cover is becoming too expensive.

Whether you are looking for cover or searching for ways to ease the costs of your current health insurance budget, there are some things to consider. According to Debbie McTaggart from Your Life Choices consumers should consider three points:

  • Extras and ancillary cover
  • Hospital cover
  • Making private health insurance work for you

She says a new offering is the ‘use as you wish’ allowance where there is a certain amount available to spend on any extras you might choose such as optical, dental or physiotherapy, but while this offers greater flexibility it is also sometimes more expensive.

If you have (or are considering) hospital cover one thing consumers should look at is how applicable it is to their stage of life. There’s no point getting cover for pregnancy if your child bearing days are over, but you might want to ensure that hip replacement or stints for you heart are covered.

It’s also good to note that if you are insured and considering swapping your insurer, if the cover is at the same level or less than what you previously held it’s unlikely you should have to serve out the waiting period. The catch being that any pre-existing conditions you had covered by one insurer might not be covered by another.

“It’s worth finding out if an alternative policy with a different insurer could still meet your individual health needs, but at a price better suited to your household budget,” Crowden says.

A large portion of the 12 million Australians who currently have private health insurance policies are aged over 50 years.

Will you shop around for health cover this year? What sort of extras do you need to be covered for?

  1. Pamela  

    As a disability pensioner without private health insurance, I have received excellent medical treatment when needed: cochlear implants 6 and 12 years ago, and in the last 5 years cancer surgery twice, radiotherapy, abdominal surgery and total left hip replacement, in addition to various tests and procedures plus a GP who bulk bills.

    I have only praise for Australia’s Medicare system – and hope it continues!

  2. Joy Anne Bourke  

    Health Funds make millions every year and yet keep increasing above the consumer Index every year. I can’t afford health Insurance being a pensioner, as I pay $600 p/f rent. I do have Extras through Police Health and it is excellent, I get 80% of any service not have to chose between Physio and Chiro or any other item. I will not change that at all. I think these funds need to think of the over 50’s that have health insurance and if they have no claims should give them a bonus. Health Funds do not do like they were years ago. I had it then and it covered everything not just hospital, but all the other services in a hospital. The Health funds are only trying to make more profit and forget about the people it insures.

  3. Lynne Highfield  

    Alas! I have finally had no alternative but to become “one of the uninsured” as after scraping together the monthly payments for 20 years, I can simply no longer afford this luxury. Have been in hospital for back surgery twice over the last two years and, although my insurer covered my hospital and surgeon’s costs, I still had to pay the excess of $500 on each occasion plus Co-Payments to the surgeon and anaesthetist. These Co-Payments can run into thousands of dollars making a mockery of the advantages of having health insurance.

    • Lynne we did the same, opted out of private health insurance when I retired, just too expensive. Had top cover for husband and myself for hospital and extras. We still had to pay extra for our glasses, teeth/dentures, operations etc. Had my gall bladder out (still in private health) and it cost an extra $2500. Husband had shoulder surgery, extra $2000. I opened a separate bank account and put the monthly payments into it. Has a nice healthy balance now.

  4. trisha  

    yes after a lifetime of Private Cover we no longer can stretch our budget. We received a little $6 odd rise per fortnight in our pensions (per couple), and this is swallowed up by absolutely everything. Leaving us way behind each week.
    So with much regret we have cancelled and now will be totally in the hands of our Public System.

    • Elaine Omdahl  

      From my experience of the public system Trisha you will be well looked after, I am full of admiration of the care we pensioners receive, as for myself, I have had private hospital only cover for what seems like a lifetime but I am about to cancel it, firstly because I can no longer afford it as an age pensioner but also, from looking around at others my age who are cared for in the public system, I feel like I am the bunny for spending over $1200 per year for cover that I don’t think I really need, my husband who has refused cover for many years, is always treated with first class care whenever he needs medical assistance, I am about to join him!

  5. Paul Buttigieg  

    Absolute rip off in just 3 years my premiums increased from $160.00 per month to almost $300.00 per month. Its actually enough to make me sick. Sadly I have just cancelled my membership and am now uninsured.

  6. I have been living overseas for 2 years I have not made a claim on my health insurance in 10years so I am definitely canceling my insurance it is now costing me $200 per month .For what ? I cant use it while I am out of Australia but they would not let me suspend it .I have had private health insurance since I left school in 1960 in that time I have had perhaps 3 claims I would have been far better off just putting the money in the bank .

    • Judy  

      We have just arranged to have our health insurance suspended whilst we’re overseas in April and May. Our insurer…Budget Direct…told us we could do that for up to 3 yrs. Maybe Ian, you should shop around to find a better Private Health Insurer.

  7. Robinoz  

    Although I’m getting older I haven’t yet run into any serious medical challenges. Given that it’s only a matter of time before I do, I can’t afford to be without medical insurance.

    What will kill me however is that I live in Alice Springs where there are NO private hospitals, thus the medical insurance premium is very much cheaper than say, Adelaide. When I move to South Australia next year, I’m going to be hit with vastly increased insurance costs and I don’t know whether I will need to ditch some of it.

    I’ll have to do my research and decide how much of the possible health expense I should “risk manage’. It’s anyone’s guess. Alternatively, it’s off to live overseas where everything is cheaper and medical care is still excellent.

  8. Kat Stutley  

    I am finally having to cancel my hospital cover after struggling to make the payments up until now. This latest increase broke the camels back. However I have kept my extras mainly for optical & dental. I couldn’t afford the $500 excess anyway on my pension!

  9. jan dodson  

    I am with HCF and they do a deal with the hospital and theatre staff and surgeon. So far each time I have left the hospital I owe nil. I am in top hospital plus top extras. I am too scared to change or drop it. Now I am paying $276 a month. I am only on the pension and with my health I have to have it. Everything goes up except the pension. It’s getting harder every month.

  10. I have had private insurance since I left school in 1962. Have just opted out with the price hike but have kept extras for eyes, physio and dental. I recently had surgery for carpal tunnel in both my hands and I still had to pay the excess and as the surgeon charged way above the scheduled fee I was out of pocket by over $1000. Not good enough!

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