Your health insurance is changing. Here’s why you should care.

Private health is changing. Here's what we know, what we don't know, and what you can do about it right now.

April is less than 10 days away and this year 1 April means more than just premium increases for Aussies with health insurance. In 2019, 1 April marks the day when a range of reforms come into effect. Some you may not notice, others will profoundly affect both your policy and ability to claim. So, what's changing?

Come 1 April there are changes to natural therapies, age-based discounts, hospital policy tiers, maximum excess and travel and accommodation benefits. While the changes to natural therapies and an increase in maximum excesses are straightforward, the others are less clear since no one knows just when and how these changes will affect all health insurance members.

Changes to private health from 1 April 2019

On 1 April, changes will come into effect that will impact your hospital and extras cover. These are:

Hospital product tiers

What we know about changes to hospital product tiers

From 1 April 2019, hospital policies will begin being grouped into four product tiers: gold, silver, bronze and basic. To be slotted into one of these four categories, health insurance policies will need to meet the minimum coverage requirements of that tier. Each tier has a list of "clinical categories" it must cover. For example, a bronze policy provides a member with cover for 18 clinical categories whereas a gold policy covers you for 38 clinical categories.

However, health funds can offer Plus (+) options for policies that are not in the gold tier. For example, a bronze plus (+) policy would cover you for all of the benefits that are covered by a normal bronze policy but it may cover you for additional clinical categories that are only minimum requirements for policies in the silver or gold tiers.

Health funds that will begin updating their tiers on 1 April include:

What don't we know about these tier changes?

While the rollout date for these tiers is 1 April 2019, health funds have until 1 April 2020 to make sure that their products are compliant. This means that a lot of people out there are being left in limbo about how their policies will be changing. It's up in the air whether health funds will:

• Transition members to a new similar policy.
• Group current policies into the new tiers.
• Terminate policies that may not work with the new tiered system.

If you have not already received a letter or email from your health fund outlining what is happening with your policy, it's not a bad idea reaching out to find out what is happening.

Age-based discounts

What we know about age-based discounts

The government is now allowing health funds to offer discounts to members under 30. Members can earn up to 10% off their annual premiums and these discounts remain in place until the member turns 40, where the discount will decrease by 2% per year until the discount is no longer being applied to their premium.

What don't we know about these changes?

While the government is now allowing funds to offer age-based discounts, it is optional. Funds may opt in or out of this in the future.

Natural therapy changes

What we know about the changes to natural therapy benefits

From 1 April, members will no longer be able to claim benefits for these 16 natural therapies:

What don't we know about these changes?

Nothing. These changes are clear and final, so you might want to run out and cram in a couple of pilates sessions before it's too late.

Maximum excess changes

What we know about changes to excess payments

The government is allowing health funds to increase the maximum excess payable on hospital policies from $500 to $750 for singles and from $1,000 to $1,500 for couples and families. This gives members the option to pay less for their health insurance premiums but a higher excess should they require treatment in a hospital.

What don't we know about changes to excess payments?

Much like with the changes to natural therapies, this change is pretty cut-and-dry.

Travel and accommodation benefits

What we know about changes to travel and accommodation benefits

Health funds will now be able to offer travel and accommodation benefits through their hospital policies. In the past, these services were covered under extras policies. It's hoped that by adding these services to hospital policies, members in rural and regional Australia will benefit.

What don't we know about the changes affecting travel and accommodation?

Like with age-based discounts, these changes are only optional. Since not all health funds will be offering these services through their hospital cover, consumers will have to do a bit of work comparing their options if they want to claim for this service.

Next steps

The health insurance industry is going to be in a state of flux for the next year, so you're going to want to

• Keep an eye out for your letter. Your letter will let you know what is happening with your cover which will include whether your policy is getting a new name and any changes to your policy.
• Compare your extras. If you were used to claiming natural therapy and nothing else you may no longer need the policy you're on.
• Evaluate your needs. No matter how your policy is changing it will pay to look at your needs and see whether these changes mean you need to look at getting a new policy.

If your policy is changing and is no longer relevant to you, you can always switch health funds. Remember, health insurance is not a lock-in contract and you can change funds whenever you want.

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