By now you’ve probably heard that private health insurance premiums are set to go up again. As of April 1, private health insurance premiums will see an average increase of 2.92 per cent.
This means roughly two in five Australians will pay extra for their health insurance policies. According to Health Minister Greg Hunt, singles can expect to pay an extra $35.36 per year, while families could pay $103.48 more.
Health expert Anthony Fleming from Compare the Market says your own premium might go up by more than 2.92 per cent, depending on your policy and health fund.
“It’s important to remember that this year’s 2.92 per cent rate rise, which has been dubbed the lowest in 19 years, is the industry average only,” he said. “Certain funds have seen average increases of more than five per cent, meaning some policies will have gone up by a lot more.”
Fleming says the yearly rate rise comes down to three factors: more people are claiming, more people are living with chronic health problems, and technology and treatments keep advancing. Additional factors leading to the increase in premiums can include rises in doctors’ fees.
While this is actually the lowest health insurance increase in almost two decades, it still represents a fairly significant increase, so it makes sense to ensure that the health insurance policy that you have suits your needs at whatever stage of life you’re in.
For example, it makes no sense to pay for pregnancy benefits if you’re in the mature stage of your life. Fleming says to plan ahead and only have cover for the benefits you’re most likely to claim on. You might be surprised how much you can save.
“We encourage consumers to use the rate rise and government reforms as a reminder to check that their cover still meets their health and budget needs,” he says. “If you’re paying for benefits you no longer need, your premiums will be higher.”
There are certain tools that can help you determine which policy is the best for you. Compare the Market has recently introduced a new feature that enables customers to see how much they will have to pay for their specific policy both before and after the rate rise comes into effect next month.
“Our dual pricing feature makes side-by-side comparisons simple, so people can ensure they are getting value from their policy both before and after the April 1 changes.”
If you can afford to, Fleming recommends paying your annual premium in advance. This essentially allows you to lock in your premium at the previous year’s premium rate. Some funds also give you a discount of up to 4 per cent for paying for your cover a year early.
By April 1, all health insurers will need to categorise their private hospital cover into four tiers: gold, silver, bronze and basic.
“The introduction of the clinical categories and the basic, bronze, silver and gold tiered system to hospital products make it easier for consumers to understand what they are covered for,” Fleming said.
“However, if policies adjust ‘to fit’ the new system, some people could find themselves without access to treatment that they have relied on previously.”
Important information: The information provided on this website is of a general nature and information purposes only. It does not take into account your personal health requirements or existing medical conditions. It is not personalised health advice and must not be relied upon as such. Before making any decisions about your health or changes to medication, diet and exercise routines you should determine whether the information is appropriate in terms of your particular circumstances and seek advice from a medical professional.