Switching health funds after 60: what you keep and what you don’t

Been with the same health fund for decades and worried that switching means starting again? Much of your history can follow you, but there are some important catches to understand first.

“I’ve been with them since 1987. I’m not starting again.”

It is an understandable reason for staying with a health fund, particularly if you have spent decades building up continuous hospital cover.

But changing insurers does not necessarily mean wiping the slate clean.

Australia’s private health insurance rules provide important protections when you move between funds. The key is knowing what follows you, what doesn’t, and what happens if you upgrade at the same time.

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What carries across when you switch

Australian private health insurance operates under community rating.

In simple terms, an insurer cannot refuse to sell you a policy because of your age, health or likelihood of making a claim. People are entitled to buy the same policy at the same price, subject to some exceptions such as Lifetime Health Cover loading.

So being older or having an existing health condition does not prevent you from changing insurers.

There is another important protection.

If you move to hospital cover with the same or a lower level of benefits, your new insurer must recognise waiting periods you have already served. You don’t start them all over again simply because the name on the insurance card changes.

Your Lifetime Health Cover status can also follow you when you transfer between insurers and retain hospital cover.

When you change funds, your previous insurer provides a Clearance Certificate, sometimes called a Transfer Certificate. It records your membership history and helps establish waiting periods already served and your Lifetime Health Cover position.

Under the Private Health Insurance Act 2007, your previous insurer is required to provide the certificate within 14 days.

What doesn’t necessarily carry across

This is where people can get caught.

Waiting periods already served are recognised for an equivalent or lower level of benefits. If you add or upgrade benefits, waiting periods can apply to those new or higher benefits.

Say you move from a policy that excludes joint replacements to one that includes them. You may have decades of private health insurance behind you, but joint replacement is a new benefit.

For hospital treatment involving a pre-existing condition, the maximum waiting period is 12 months. For most other hospital treatments, the maximum is two months.

Extras are different again. Waiting periods for general treatment such as dental, optical and physiotherapy are set by individual insurers.

Your extras limits don’t necessarily reset when you move either. Benefits already paid by your previous insurer may be taken into account by the new insurer when it calculates annual limits, while accrued benefits, credits or bonus points usually cannot be transferred.

Ask the new insurer exactly how it will treat your claims and limits before making the move.

Be careful with a gap between policies

This is where two different rules are easily confused.

For waiting-period continuity, there is no single government rule giving everybody 63 days to move between insurers. Some insurers may allow a break of up to two months, while others may allow only one week.

Check with your new insurer before allowing any gap between policies.

Lifetime Health Cover works differently.

If you have previously held hospital cover on or after your Lifetime Health Cover base day, you can generally accumulate up to 1,094 permitted days without hospital cover over your lifetime without your loading increasing.

Once those permitted days are exhausted, your loading can increase by two percentage points for each further year without hospital cover. Lifetime Health Cover loading is capped at 70 per cent.

If you do have a loading, it can be removed after 10 years of continuous hospital cover, although certain permitted breaks can affect how that period is counted.

So don’t cancel a policy on the assumption that you can simply sort out another one later.

If the aim is to reduce what you pay, changing your policy rather than cancelling hospital cover altogether may be worth investigating first.

When is the right time?

You can change health insurers at any time of year. There is no annual switching window.

But there is an obvious time to review what you’re paying.

Private health insurance premiums traditionally change on 1 April, so looking at your cover before the annual premium round gives you time to understand what you have and compare it with alternatives.

There is another April date particularly relevant to older Australians this year.

The federal government’s proposed changes to the age-based private health insurance rebate are scheduled to begin on 1 April 2027 if the legislation passes Parliament.

The Bill has not passed Parliament and the Senate Community Affairs Legislation Committee is due to report on October 7, 2026.

We’ll report on what the committee says and what it could mean for older policyholders.

For now, there is time to look at your cover properly rather than making a rushed decision.

Doing it yourself, or getting help

You can compare policies yourself.

The Australian Government’s private health website publishes a Private Health Information Statement for every policy available in Australia, showing what it covers along with restrictions, waiting periods, excesses, co-payments and other important details.

A comparison service is another option if you would prefer someone to work through the policies with you.

There is something you are entitled to know if you use one, and we’d rather say it plainly: comparison services can receive commission from health funds when a policy is taken out. That is how the service can be provided without charging you directly.

A comparison service may also work with a panel of insurers rather than every fund in Australia, so it is reasonable to ask which insurers are being compared.

One Starts at 60 reader summed up the concern after an earlier health insurance article:

“I hate that when you email comparison site they really pressure to change. Why can’t we just get an honest comparison without the hype?”

It’s a fair concern, and it is one of the reasons we were careful about who we partnered with.

The service now offered through Starts at 60 is run by about a dozen Australian advisers who average about seven years in the job, with an average customer age of 63.7. In other words, they regularly have these conversations with people at exactly the stage of life we’re writing about.

You can call and be told your current policy is fine. Plenty of people are.

Worth knowing where you stand?

You can compare your health insurance with Starts at 60, or talk it through with an Australian adviser on 1800 31 23 60. There is no obligation and no pressure to switch – plenty of people call simply to find out whether their current cover still stacks up.

We’ll be following the legislation through to the Senate committee report in October and will come back to what it means from there. If you have a question about your own situation, leave it in the comments below. We read them, and they help shape what we cover next.

IMPORTANT LEGAL INFO This article is of a general nature and FYI only, because it doesn’t take into account your personal health requirements or existing medical conditions. That means it’s not personalised health advice and shouldn’t be relied upon as if it is. Before making a health-related decision, you should work out if the info is appropriate for your situation and get professional medical advice.