Health insurance premium going up by 5.59% for 2016

Richard Laycock 2 March 2016 NEWS

Respite for consumers as April private health insurance increases hit four-year low.

March 31 Health

Australian consumers can breathe a sigh of relief as health insurance premiums are only set to rise by an average of 5.59% in 2016.

After some back-and-forth between Minister for Health Sussan Ley and private health insurers, premium prices will rise by the lowest level in the last four years, 10% less than the previous years' increase.

Minister Ley confirmed that after she requested insurers reconsider their premium increases, 20 health funds resubmitted a lower premium increase, meaning lower-than-expected price rises for over 93% of Australians with private health insurance.

As a result of the resubmission request, Australian families with combined hospital and general health cover save roughly $166 per year compared with what they would have been paying if the increases went ahead as originally planned.

Ley's hope is that these lower-than-average premium increases encourage more competition between funds, and make it easier for consumers to shop around and compare their options in order to find the best deal.

How much are Australian insurers raising their premiums in 2016?

The table below shows the 2016 health insurance premium increase and compares them with the previous year.

Insurer Average increase with rate protection
2016 2015
ACA Health Benefits Fund
6.19% 4.96%
Australian Unity Health Limited 5.05% 6.26%
Bupa Australia Pty Ltd 5.69% 5.59%
CBHS Health Fund Limited 5.92% 6.58%
CDH Benefits Fund 6.19% 6.99%
CUA Health Limited 8.95% 6.35%
Defence Health Limited 5.48% 5.62%
Doctors Health Fund 3.76% 3.98%
GMHBA Limited 5.44% 6.43%
Grand United Corporate Health 4.26% 4.32%
HBF Health Limited 4.94% 5.96%
Health Care Insurance Limited 6.90% 6.12%
Health Insurance Fund of Australia Limited 6.55% 5.31%
Health Partners Ltd 7.14% 4.49%
health.com.au 8.81% 5.76%
HCF 5.42% 6.57%
Latrobe Health Services 5.52% 6.15%
Lysaght Peoplecare Ltd 4.38% 6.08%
Medibank Private Limited 5.64% 6.59%
Mildura Health Fund 6.74% 6.14%
National Health Benefits Australia Pty Ltd (onemedifund) 5.28% 6.26%
Navy Health Ltd 5.50% 4.50%
NIB Health Funds Ltd. 5.55% 6.55%
Phoenix Health Fund Limited 5.72% 6.48%
Police Health 4.81% 4.48%
Queensland Country Health Fund Ltd 4.91% 4.77%
Queensland Teachers' Union Health Fund Ltd 7.15% 6.36%
Railway and Transport Health Fund Limited 5.61% 6.17%
Reserve Bank Health Society Ltd 5.37% 4.88%
St.LukesHealth 5.89% 6.27%
Teachers Health Fund 4.97% 6.86%
Transport Health Pty Ltd 6.49% 4.84%
Westfund Limited 5.94% 7.92%
Industry weighted average 5.59% 6.18%

Biggest winners

Which insurers had the lowest health insurance premium increase?

Insurer Average increase with rate protection YoY Change
2016 2015
Lysaght Peoplecare Ltd 4.38% 6.08% -28%
Teachers Health Fund 4.97% 6.86% -28%
Westfund Limited 5.94% 7.92% -25%
Australian Unity Health Limited 5.05% 6.26% -19%
HBF Health Limited 4.94% 5.96% -17%

Biggest losers

Which insurers had the highest health insurance premium increase?

Insurer Average increase with rate protection YoY Change
2016 2015
Health Partners Ltd 7.14% 4.49% 59%
health.com.au 8.81% 5.76% 53%
CUA Health Limited 8.95% 6.35% 41%
Transport Health Pty Ltd 6.49% 4.84% 34%
ACA Health Benefits Fund 6.19% 4.96% 25%

Why do health insurance premiums increase?

Generally, health insurance premium increases reflect insurers project their costs will be over the coming year. These increases take into account situations such as:

  • Increased medical treatment and service costs
  • An ageing population
  • Remaining viable in the long term

Today's lower than average increases may be an indication of good things to come for consumers, as insurers are displaying signs that they are open to a sensible reform process and lowering premiums long-term.

Compare your options and lock in the lowest premium with help from an adviser

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