When the end of the financial year comes around, we’re often too preoccupied with sales and taxes to think about our health insurance. However, if you’re not aware of your health insurance reset date, you could be leaving hundreds of dollars’ worth of extras services on the table.
To get the most value out of your health insurance, you’ll want to keep in mind how much of your annual limits you’ve used and when they reset. If you’re regularly reaching your reset date without using your full limits or using them all up ahead of time, you might want to consider switching to an extras policy that better fits your health care needs.
If you’re one of the 55% of people in Australia with extras insurance,1 you’ll find the amount you can claim on health services like dental check-ups, podiatry and chiropractic is limited each year. Once you hit those limits, you won’t be able to claim until the health fund resets your benefits.
For example, if you had an annual limit of $500 for physiotherapy appointments, that’s the maximum amount you’ll be able to claim back on physio appointments within the relevant 12-month period. Any additional physio sessions afterwards will be paid for entirely out of your own pocket until your extras limit resets.
Depending on your health insurer and when you took out your policy, extras benefits will typically reset at the end of the calendar year (1 January) or the end of the financial year (1 July). Some private health funds reset limits 12 months after you took out cover on your policy anniversary.
Annual claim limits vary depending on your insurance provider and your level of extras cover. You’ll typically find that there’s a set amount you can claim each time you receive a treatment listed on your policy, up to an annual limit each year.
The particular amount will depend on the treatment and what’s listed in your policy, and will generally be a dollar amount or a percentage of the bill.
All the specific details will be listed in your policy brochure, so it’s critical to give this a read before taking out a policy.
No, unused limits won’t carry over if you haven’t used them by the annual reset date. During the COVID-19 pandemic, several health insurers did allow unused limits to carry over, but only for exceptional circumstances.
When switching health insurance, it’s vital to have a new policy lined up when you cancel your existing one, as you won’t be able to make any claims during that intervening period of time. Depending on your personal circumstances, the level of cover you’re switching to or your new health insurer, you might need to undergo waiting periods.
Beyond the annual yearly limit, you might have some other types of limits on your extras policy, such as:
Multiple limits can sometimes apply at once, such as a group limit of $1,000 for some medical treatments but a $500 limit per person. These limits will vary between insurers, so it can help to compare different policies for a better understanding of what each one covers.
This may sound obvious, but the best way to get value for your money is to claim on the services you use. For instance, visiting the chiro isn’t always fun, but neither is the bill. However, if you’ve been putting off getting treated, you’ll at least save yourself some money when going in for treatment with an extras policy. Remember to check your policy brochure to ensure you haven’t reached your benefit limit before being treated.
If your annual premiums are greater than what you tend to claim back on services and treatments – and you don’t expect your health needs will change anytime soon – you might save money by comparing and switching to a different extras policy.
A good way to ensure you’re getting the most from your cover is to plan out your treatments in advance to avoid using up your limit early or not using enough before they reset. For example, if you know you require a major dental procedure later this year, you might want to consider claiming less on other services that share a limit with major dental until your treatment. Similarly, if you know you don’t need any expensive medical treatments in the next year, consider scheduling in some regular preventative physio or remedial massage appointments.
This may seem counterintuitive, as higher levels of extras cover attract higher premiums. However, if you require regular appointments (like physiotherapy), you might find yourself reaching the benefit limit early in the year.
A higher level of extras cover can increase your benefit amount or limit, reducing your out-of-pocket costs. This might offset the extra amount you’re spending on a higher level of cover.
Some funds offer certain no-gap services, the most common of which is no-gap optical or dental. For example, if you require glasses and your optometrist charges more for your frames or lenses than your benefit limit covers, you will have to pay the difference as an out-of-pocket expense called the gap.
No-gap schemes work so that you don’t have out of pocket expenses for agreed treatments or services. Ask your insurer or if they have a no-gap agreement with any specialists near you.
Extras cover offers affordable access to some services that Medicare doesn’t cover. For that reason, it can be an important product for many Australians.
If you’re thinking of taking out extras cover or a combined health insurance policy with extras cover for a range of treatments, look at the annual limits through our free health insurance comparison service, or call our experts directly.
1 The Australian Prudential Regulation Authority: Quarterly Private Health Insurance Statistics. March 2022.
