Millions of Australians with private health insurance will soon be paying even more for their policy, with the Federal Government today announcing another price hike.
From April 1, private health insurance premiums will increase by an industry average of 3.03%. However, this is just an average, and the actual jump in premiums will vary between insurance providers and your individual policy. Either way, it means some households could be paying hundreds of dollars more a year for private health insurance.
Compare the Market’s Economic Director, David Koch, said health insurance premiums typically increase every year on April 1.
“Many health funds chose to delay their premium increases in 2023, meaning this upcoming increase will be a lot sooner than expected for some people,” Mr Koch said.
“Health funds are increasing premiums by an average of 3.03%, but the hikes can vary widely between providers and policies.
“Now’s the time to ensure you’re not paying more than you need to for insurance. You may be able to secure the same level of coverage elsewhere for a lower price.”
According to Mr Koch, premium increases aren’t a cash grab from insurance companies, but rather a necessity for healthcare professionals to continue providing services of the highest quality.
“A lot of factors are considered when increasing health insurance premiums, such as doctor fees, the cost of medical equipment, the increased cost of hospital procedures, wages of health professionals and more,” Mr Koch explained.
“Similarly, all health insurers are required to submit details of their proposed premium increases to the Department of Health for assessment. Along with the Australian Prudential Regulation Authority, the Department of Health considers a range of factors before applications are passed on to the Health Minister for final approval.
“In some instances, the insurers submission isn’t successful, and they need to resubmit their proposed price changes. So, a lot of regulation goes on behind the scenes that everyday Australians may not realise.”
| Health insurance industry average rate increase by year | |
| Year | Average Rate rise (%) |
| 2024 | 3.03% |
| 2023 | 2.9% |
| 2022 | 2.7% |
| 2021 | 2.74% |
| 2020 (delayed 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% |
| 2012 | 5.06% |
Source: Department of Health and Aged Care.
However, with lengthy public waitlists for elective surgeries and high costs for many out-of-hospital appointments such as dental and physiotherapy, Mr Koch said it was time for Aussies to consider switching, rather than ditching their health insurance.
“A lot of families are going to see these price hikes and consider ditching their cover, but it’s important to remember the benefits that private health insurance can provide,” Mr Koch said.
“Instead of cancelling your policy altogether, consider removing services that aren’t important to you by switching to a policy that’s more suitable for your needs.
“For example, you may currently be on a Gold hospital policy with all the bells and whistles, but may find that a Silver Plus or Silver policy still provides all the inclusions you need, without paying for ones you don’t.
“Or you may not be utilising all the extras that are available under your policy, so you may consider switching to one that includes less services.
“Some funds are increasing rates much higher than others, so there’s never been a better time to ensure that you’re not paying a cent more for your cover.
“If you find another policy that offers the same level of cover for less, it could be time to switch.”
2024 average rate rise by fund.
| ACA Health Benefits Fund Limited | 3.18% |
| AIA Health Insurance | 2.19% |
| Australian Unity Health Limited | 1.42% |
| BUPA HI Pty Ltd | 3.61% |
| CBHS Corporate Health Pty Ltd | 5.82% |
| CBHS Health Fund Limited | 4.51% |
| Defence Health Limited | 1.00% |
| Doctors’ Health Fund Pty Ltd | 2.79% |
| GMHBA Limited | 2.91% |
| HBF Health Limited | 3.95% |
| Health Care Insurance Ltd | 0.27% |
| Health Insurance Fund of Australia Limited | 3.87% |
| Health Partners Limited | 1.93% |
| Hospitals Contribution Fund of Australia Ltd | 2.89% |
| Hunter Health Insurance* | 3.32% |
| Latrobe Health Services Limited | 3.04% |
| Medibank Private Limited | 3.31% |
| Mildura District Hospital Fund Ltd | 2.14% |
| National Health Benefits Australia Pty Ltd | 3.41% |
| Navy Health Ltd | 3.10% |
| NIB Health Funds Ltd | 4.10% |
| Peoplecare Health Limited | 1.63% |
| Phoenix Health Fund Limited | 3.72% |
| Police Health Limited | 3.01% |
| Queensland Country Health Fund Ltd | 2.53% |
| Queensland Teachers’ Union Health Fund Limited | 1.96% |
| Reserve Bank Health Society Ltd | 2.97% |
| St Luke’s Medical and Hospital Benefits Association | 3.20% |
| Teachers Federation Health Ltd | 2.65% |
| Westfund Limited | 2.82% |
| Industry Average | 3.03% |
Source: Department of Health and Aged Care.
To help Australians look for a better deal on their health insurance, these are Mr Koch’s top tips.
- Look for offers and perks. Around the time when health rates rise, we often see a lot of perks, incentives, and promotions offered to sweeten the deal and encourage people to switch. For example, some providers may waive some of their waiting periods, give you free coverage for a limited time or offer other initiatives such as access to wellbeing and rewards programs. These perks can vary between providers, which is why it’s important to compare.
- A cheaper policy may not be the best value. Lower premiums can come at the sacrifice of fewer inclusions. Decide what coverage is most important to you and choose a policy that caters to these needs.
- Don’t waste your money on what you don’t need. More comprehensive policies will typically include a wider range of inclusions, but keep in mind this comes at the cost of higher premiums. If your health circumstances have changed, you may be able to snag a better deal by switching to a lower level of cover that still includes the things you need.
- You don’t need to reserve waiting periods. If you switch policies, your new fund will recognise any waiting periods you’ve already served. However, you’ll still need to wait for any new or upgraded services and benefits.
- Cross your ‘t’s and dot your ‘I’s. Always read the terms and conditions carefully if you’re considering switching or taking out a new policy. All the details, including inclusions, exclusions, waiting periods, excess amounts, and more, will be found in your policy brochure.
For more information, please contact:
Phillip Portman | 0437 384 471 | [email protected]
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