Explore Health Insurance

When it comes to choosing private health insurance, you want to make sure you’re getting a policy that covers the things you expect it to – ideally, at a competitive price.

So, we break down:

  • how much Aussies are paying for their hospital and extras policies; and
  • questions you should ask yourself to ensure you’re getting the most out of your policy, now and in the future.

How much is health insurance costing Aussies?

Aussies are paying approximately $2,499 each year on hospital policies, $1,060 each year on extras-only policies, and around $3,450 yearly on a combined hospital and extras policy, according to IPSOS in 2019.1

Keep in mind, though, that the price of your health insurance depends on:

  1. your health fund; and
  2. the level of cover you want and need.

Whichever state or territory you reside may also have an impact on the cost of your health insurance, particularly if you need to take out an ambulance policy as an additional cover option.

To find out how much health insurance could cost you, try our free comparison tool. It takes only minutes to compare premiums, excess options (the amount you may pay to claim) and features from some of Australia’s top insurers!

Your age, gender and health condition don’t impact your premiums

Thankfully, health insurance is community-rated. Your age, gender and health status have no bearing on how much cover will cost. So, a healthy 30-year-old and an unwell 70-year-old will pay the same price for the same policy.

The only differences in cost for the same policy may arise:

Read more about what influences the cost of health insurance.

The cost of health insurance changes each year

On 1 April every year, many insurers increase their private health insurance premiums to keep in-line with things like:

  • increasing hospital costs
  • the rate of health insurance claims
  • an increasing number of medical equipment and evolving technology
  • an increasing number of expensive and complex surgeries for private patients.

For any premium increases, insurers must first seek approval from the Federal Government – this is to ensure any cost changes are necessary, reasonable and fair.

Here’s a view of how much rates have increased from 2010 to 2021.

health-insurance-rate-rise-2010-2021

These rates are industry-weighted averages. So, while the rate rise in 2021 is an industry-weighted 2.74%, health funds can choose to increase their policies by more or less than this rate. In fact, some funds in 2021 are increasing their rates by as little as 0.50% or as much as 5.47%.

Whether you’re looking for a policy now or you already have health insurance, you should regularly compare cover options to see which fund is offering the best value for your needs.

How does your level of cover affect your premiums?

The level of cover you choose will impact how much you pay for your private health insurance. Essentially, the more cover you have, the more you’ll pay for your policy.

Which levels of hospital cover are there?

From 1 April 2020, all hospital policies must conform to four tiers of cover: Basic, Bronze, Silver and Gold. The higher your cover (i.e. Gold), the more expensive your premiums will be.

You might also find some Plus/+ health insurance policies affect the price you pay for your cover.

Why?

Plus policies offer more coverage than what comes standard in the four tiers (i.e. Silver Plus will offer more than what a standard Silver policy will offer), and may, therefore, be more expensive.

Do extras policies come in different ‘tiers’?

Extras policies do vary in the level of cover they offer (and, ultimately, vary in price). Some policies are more basic, while others provide greater cover options and allow you to claim more on certain services throughout the year.

Average monthly cost of Basic, Bronze, Silver and Gold hospital policies

Here’s a view of how much, on average, Basic, Bronze, Silver and Gold policies can cost a single Queenslander each month. These prices are based on products from PrivateHealth.gov.au, and only consider policies with a $750 excess. Plus policies are also included in the data.

Remember, the below averages aren’t necessarily what you’ll pay for your specific cover.

  • Basic: $79.78 (ranging from $73.03 to $89.10)
  • Bronze: $96.25 (ranging from $84.23 to $123.14)
  • Silver: $139.62 (ranging from $99.02 to $188.55)
  • Gold: $178.42 (ranging from $141.67 to $206.05)

Sourced 4 March 2021 and subject to change. Figures also account for Plus policies, but don’t include any Lifetime Health Cover (LHC) loading, rebates or surcharges.

Average monthly cost of ambulance-only policies by Australian state and territory

State/TerritoryAverage ambulance cost
Australia Capital Territory $4.93 (ranging from $3.48 to $8.62)
New South Wales $4.93 (ranging from $3.48 to $8.62)
Northern Territory $5.14 (ranging from $3.48 to $9.44)
South Australia$5.36 (ranging from $3.48 to $9.22)
Victoria$5.17 (ranging from $3.48 to $10.12)
Western Australia$4.69 (ranging from $3.48 to $6.15)

Sourced 4 March 2021 and subject to change. Some prices include emergency only or emergency and non-emergency policies.

Queenslanders and Tasmanians do not need to pay for ambulance cover; these costs are covered by the governments for emergency transportation inside the state. Better still, if you live in Queensland and visit another part of Australia, you still won’t need to pay for emergency transportation.

If you’re travelling from Tasmania to the mainland, you aren’t covered in South Australia or Queensland. If you’re going to New South Wales, you should check with the Ambulance NSW Customer Service to see if you’re covered.

woman-at-dentist-happy

Is health insurance worth the money?

Whether or not a health insurance policy will be suitable for you entirely depends on your circumstances, objectives and lifestyle. To provide some food for thought, we’ve put together some reasons why health insurance might be a product worth considering:

  • you can choose your own doctor if they’re available for your surgery or treatment dates;
  • you get the privacy of your own room (if one is available), which is particularly helpful when you’re a new mum or recovering from surgery;
  • you can avoid long public hospital waiting periods for necessary treatment; and
  • with an extras policy, you can claim a range of out-of-hospital services Medicare doesn’t subsidise (i.e. physiotherapy, dental, chiropractic).

How to ensure you’re not paying too much for health insurance

Why pay more for your policy than you need to? To ensure you’re getting good value from your health insurance, ask yourself the following questions:

You’re looking to purchase a policy:

Who do I want my policy to cover?

If you’re looking for health insurance for yourself, a singles policy could be right up your alley. Or, if you have a partner, a couples policy could be right for you.

With a couples policy, it’s important you both get value from your cover. For instance, if your partner requires a top-level policy, and you only need more basic coverage, you might find that two separate policies are kinder to your budgets.

For families, a family or single-parent family policy could be a good option. Every family member listed on your policy is covered for the same services, and you may be able to take advantage of often higher claim limits for extras policies. This is helpful in case multiple family members need the same treatment within close time frames.

Which services do I need cover for?

When you consider this question, make sure you also think a little down the line. For instance, are you looking to start a family? If so, you might be interested in a policy that offers cover for pregnancy and birth-related services. However, these services attract a 12-month waiting period before you can claim. So, you’d need to take out your policy before falling pregnant to be covered.

On the flip side, you may not want pregnancy cover at all. This may mean you look for a lower-level policy that’s better for your budget, yet still covers you for the things you need.

Or, perhaps you play sport and are at risk of injury, or your child wears glasses; in these instances, an extras policy may prove helpful in reducing the cost of physiotherapy and optometry.

Which excess and co-payment options should I go for?

You should choose your excess carefully; this is the amount you pay towards your treatment when you claim on your policy. If you opt for a higher excess amount, your premiums are typically smaller. However, the opposite also applies.

Overall, consider your likelihood to make a claim. Lower premiums may be appealing now, but will you be able to afford a higher excess when you claim?

When reviewing cover options, also keep an eye out for any co-payments you may need to pay.

Co-payments are fees some insurers require you to pay for every day you’re admitted as a private patient in a public or private hospital. These costs may or may not apply, depending on the insurer and policy.

Have I considered my options?

If you’ve only looked at a few policies, or haven’t yet started researching, don’t forget that comparing your options increases your chance of finding a good fit for you and your family.

Our comparison service makes this process effortless, allowing you to weigh up policies from a range of insurers in minutes.

You already have a policy:

Do I stress over the amount I pay each month/year?

If your policy is becoming a financial burden, perhaps it’s time to see if you can get a better value product. You can switch your policy at any time, and your insurer will carry over your already served waiting periods to your new policy.

When switching insurers, it’s important you obtain a Clearance Certificate from your current health insurer. Also called a Transfer Certificate, this document outlines details like the type of cover you had and when you joined.

If you don’t hand your new insurer your Clearance Certificate, you may need to re-sit your waiting periods – this means you can’t claim on certain services and treatment until you’ve served these periods.

Have I claimed the services on my hospital or extras policies?

Because so many of us choose to get covered by health insurance, it’s no surprise that each product covers a broad range of services. It’s nice to have coverage for anything you may need; such as physiotherapy, remedial massage, knee reconstruction – the list could go on forever.

But do you really need this level of coverage? If you find you aren’t claiming on your policy, it’s time to re-evaluate your policy and find cover that better suits your situation (which could save you some cash).

Did I opt for a low (or no) excess or co-payment, yet I don’t claim often?

If you opted for a low (or no) excess or co-payment, your premiums may be quite high. This can be more of an issue for your hip pocket when you aren’t claiming as much as you anticipated on your cover.

Does it make sense to keep those per-treatment costs at a minimum, or do you claim often enough to warrant the higher premium? Run the numbers for your situation to find out.

Do I have joint cover, but don’t share the same cover requirements as others on my policy?

If you have joint cover (e.g. a couples or family policy) everyone gets covered for the same thing. However, what if your partner requires a more expensive treatment, but you don’t? It’s not worth the streamlined paperwork of having joint cover if you pay extra for the luxury.

When comparing policies, complete several quotes. One for you as a couple/family, and a few others for each member of the family. Which works out cheaper?

Have I compared health insurance options recently?

If you’re asking, ‘Am I paying too much for my health insurance?’, the good news is, it’s easy to find out!

We believe comparing products side-by-side is a smarter way to shop. Not only could you find great-value products, but it also gives you an opportunity to think about your healthcare needs. For this reason, assessing your insurance annually is highly recommended.

Ready to get started? Compare health insurance policies right here, or give us a ring. We’ll go through your options and help you arrive at a positive outcome.

Source

1IPSOS survey of thousands of Australians between 2018-2019. Average prices do not include the Australian Government Rebate.

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