The Federal Minister for Health and Aged Care has announced that the annual private health insurance premium increase this year would be an industry-weighted average of 2.9%. This change will take effect on 1 April 2023, although many funds are delaying their increase due to rising cost of living pressures.
While this is more than last year’s increase of 2.7%, it is still well below the 10-year average of 4.4%.
So, what does the annual premium increase mean for the average Australian?
In 2023, single policyholders can expect to pay an extra $60.84 per year on average, while families are looking at an average increase of around $134.16 per year.1
Our health insurance expert, Lana Hambilton, says, “We know even a small change can have a big impact on household finances.
“How the premium change impacts you, and when it will commence, will depend on which health fund you are with.”
In fact, your premium may increase by more or less than the average premium increase of 2.9%. The highest premium increase planned for 2023 is 5.38%, while the lowest is actually a decrease of -0.09%
Even with the rate rise, private health insurance remains as valuable as ever, with benefits including:
Plus, you’ll have peace of mind that if something goes wrong for you or your family, you’ll be well-positioned to get the health care you need as fast as possible.
You should regularly review your policy and compare options to make sure it’s a good fit for your personal needs and circumstances.
You should consider the following steps when your health insurer gets in touch about your rate increase.
Review your current policy. See if it still fits your needs, budget and lifestyle. If you haven't done this in a while, you might find that your current private health insurance policy is no longer right for you.
Reconsider the health services you need. Hospital cover policies bundle different procedures into product tiers (Basic, Bronze, Silver and Gold). This means you might be paying more for expensive services you don't need (e.g. birth-related services).
Update your cover. Has your life changed since you took out your current policy? Are you planning on having a family? Or maybe you've recently suffered a health scare? Whatever it may be, switching to a new policy could make the difference in safeguarding your future health and saving you money.
You will be notified of your private health insurance premium increase by your health fund via post, email or SMS. This way, you can check over any updated policy information and make an informed decision about what to do next. While some funds increase their premiums as early as 1 April each year, other funds have announced that they will delay their rate rise until later in the year.
Before health funds can raise their premiums, they must submit their proposed price increases to the Australian Government and the Australian Prudential Regulation Authority (APRA) for approval. The federal government checks all submissions to ensure they’re sustainable, fair and necessary.
Some factors that lead to rate rises include:
As the health insurance premium rate rise is a weighted average, some health funds increase their prices more than others.
This weighted average is based on changes to a health fund’s entire portfolio of policies; this means the cost of some policies may go up a substantial amount, some may increase slightly, some may not go up at all, and some could even decrease.
These proposed changes are reviewed, and if the insurer can’t sufficiently justify why they need to increase their premiums, the proposal will be rejected.
Below is the average rate rise for each health fund in 2023. Keep in mind this is the average increase across all policies offered by the health fund; not all policies will be increased by this amount, if at all.
| Health fund | Average rate rise (%) |
| ACA Health Benefits Fund Limited | 3.92% |
| AIA Health Insurance | 1.69% |
| Australian Unity Health Limited | 3.76% |
| BUPA HI Pty Ltd | 3.39% |
| CBHS Corporate Health Pty Ltd | 5.38% |
| CBHS Health Fund Limited | 4.46% |
| Cessnock District Health Benefits Fund Limited | 3.93% |
| Defence Health Limited | 3.48% |
| Doctors’ Health Fund Pty Ltd | 2.15% |
| GMHBA Limited | 2.33% |
| HBF Health Limited | 4.49% |
| Health Care Insurance Ltd | -0.09% |
| Health Insurance Fund of Australia Limited | 3.10% |
| Health Partners Limited | 2.93% |
| Hospitals Contribution Fund of Australia Ltd | 3.33% |
| Latrobe Health Services Limited | 2.15% |
| Medibank Private Limited | 2.96% |
| Mildura District Hospital Fund Ltd | 2.48% |
| National Health Benefits Australia Pty Ltd | 2.86% |
| Navy Health Ltd | 2.94% |
| NIB Health Funds Ltd | 2.72% |
| Peoplecare Health Limited | 2.79% |
| Phoenix Health Fund Limited | 3.72% |
| Police Health Limited | 0.00% |
| Queensland Country Health Fund Ltd | 3.17% |
| Queensland Teachers’ Union Health Fund Limited | 0.81% |
| Reserve Bank Health Society Ltd | 3.18% |
| St Luke’s Medical and Hospital Benefits Association | 2.86% |
| Teachers Federation Health Ltd | 2.50% |
| Transport Health Pty Ltd | 2.49% |
| Westfund Limited | 2.65% |
| Source: health.gov.au2 | |
Since the Private Health Insurance Act 2007, the Department of Health has approved private health insurance rate rises. Take a look to see how health insurance rates have changed in Australia over the past decade.
| Health insurance rate increase by year | |
| Year | Rate rise (%) * |
| 2023 | 2.9% |
| 2022 | 2.7% |
| 2021 | 2.74% |
| 2020 (delayed for many funds due to the pandemic) | 2.92% |
| 2019 | 3.25% |
| 2018 | 3.95% |
| 2017 | 4.84% |
| 2016 | 5.59% |
| 2015 | 6.18% |
| 2014 | 6.2% |
| 2013 | 5.6% |
| Total increase | 46.87% |
| * Industry average, as taken from health.gov.au | |
With so many options available and differing levels of cover to choose between, it can be daunting to know which policy is the right one for you.
Let us help take the stress out of the process with our health insurance comparison service. With our service, you can easily compare policies to see if there’s an alternative to your existing policy for you and your family.
