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According to 2016 APRA statistics, fewer Australians aged 20-29 took out health insurance than any other age group.

This is really no surprise when you consider that 91% of 15 – 34-year-olds rate their health as “good” to “excellent”.

In short, many young Aussies think they’re fine without health insurance.

Why would I consider health insurance in my 20s?

There are three main reasons why you need to consider health insurance in your 20s.

1. Security. In Australia, ambulances take all serious patients straight to a public hospital and Medicare covers all your treatment and accommodation costs as a public hospital patient. This ensures you’ll always have access to critical treatment when you need it, whether you have hospital cover or not.

However, non-critical patients have to sit through waiting periods that average 37 days for elective surgery, and cannot choose their own doctor, or stay in a private room.

So if you want more control over your hospital visits, and skip public waiting lists, start considering hospital cover now.

2. Extras. There is great debate over whether extras are worth your money. They can be excellent value if the premiums you pay cost less than the benefits you receive. If you’re thinking about getting extras cover, ask yourself the following questions:

  • Do you need regular checks ups or a corrective dental plan?
  • Do you need new prescription glasses each year?
  • Would you attend the physio frequently?
  • Do you need (or want) remedial massages?

If you’ve answered yes to only one of the above questions, you may not need extras cover (unless you’re planning corrective dental work in the near future), as it might be more cost effective to cover the fee yourself.

If you’ve answered yes to more than one, however, compare extras policies and see if it’s worth your money.

3. Tax purposes. If you have private health cover, you could get money back on your tax return under the Australian Government Rebate.

However, if you are single and earn over $90,000, or you have a partner and a combined income of more than $180,000, you may have to pay the Medicare Levy Surcharge (MLS). The MLS is a surcharge levied on higher income earners who don’t hold private hospital cover, charged as a percentage of your income.

So, you have two choices:

  • Offset the levy by paying for health insurance; or
  • Pay the levy and utilise Medicare instead of health insurance.

In all honesty, you’ll still have to pay for one or the other unless you fall into one of the few exemption categories. If you have to choose, why not select the option that gives you more alternatives, not less?

If you’re unsure whether you are impacted, try our simple-to-use MLS calculator to find out.

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