What you need to do to find the right health fund for your needs.
Are you looking for the best health insurance* policy? While it may seem a simple task, getting the best private health insurance* in Australia is a matter of perspective.
Why? Because what you think of as the best medical insurance* may not be the right cover for someone else. You might value a policy that provides you with comprehensive extra cover, while someone else may just be looking for cover to help them avoid paying the Medicare Levy Surcharge if you earn over a certain income. Make sure you choose the right health fund for your situation.
The best* health insurance policy is the cover that is best* for you, your family and your circumstances. In general, the fund should:
- Have low or no gaps between what is covered by Medicare and what your insurance will pay
- Come from an insurer with a good industry rating, high retention rates and few complaints
- Have only minimum waiting periods
- Cover more procedures with no out-of-pocket expenses
- Include lots of extras, benefits and discounts
- Have lower management expenses as a percentage of premiums
The first question you should ask yourself when choosing private health insurance is "Do I need it?". As an Australian, you already have hospital cover under the Medicare public health system. Whether you need more cover than this will depend on whether you want:
- Treatment at a hospital of your choice
- Your own doctor to treat you
- A private or semi-private room
- Elective surgery when you need it, rather than joining a waiting list
- Cover for ancillaries not covered by Medicare
If you decide you do need private health insurance, choosing the right cover involves determining your needs and the level of cover each policy provides:
- If you are young and single, hospital cover may not be a high priority, so you will need to find a policy with the best* cover for ancillaries such as optical and dental
- If you have dependants, you will need to find a policy that provides the best* family cover, preferably with individual rather than overall capped benefit limits
- If hospital cover is important to you, you will need to find a provider who has agreements with hospitals in your area and a policy that covers a high percentage of costs, so you don’t end up paying a large gap
While hospital cover is there for when you need it, extras cover is an area where you can actually get something back on what you have paid out for things such as dental, optical and chiropractic services.
- The benefit paid on such extras varies considerably with insurers and you need to look carefully at what the benefit limits are on a policy to decide whether it offers good value for money. Basically, if you are paying out a lot more than you are getting back, you may need to look at adjusting your cover or finding another insurer.
- If you use one service more than most, such as requiring regular dental treatments, you should find a policy that pays higher benefits in this area, rather than just paying a fixed premium for a range of services you barely use.
- Also rather than paying a set amount for a service, look for policies that cover a percentage of your bill, the higher the better, as this provides better value, particularly if your healthcare provider charges above-average prices.
- When shopping for the best* extras cover, also look for insurers who offer discounts for using their preferred service providers, as this can work out much cheaper and also look for policies that include lifestyle cover, which can give you access to a range of health and lifestyle-related discounts.
Switching health insurance providers is easier than most people realise. Given that the cost of health cover is on the rise in Australia, there’s never been a better time to shop around and switch if necessary. If your current policy no longer meets your needs, if you’ve found a better deal or if your personal circumstances have changed, switching insurers makes good sense. And you won’t be penalised for doing so. Providing your current policy is paid and up-to-date at the time of switching, your existing benefits will travel with you to the new provider. These include:
- Your Lifetime Health Cover status. Your level of age loading will remain unchanged.
- Your government rebate. Providing your level of cover isn’t changing, you will receive the same government rebate as you received previously.
- Your waiting period exemption. If you have already served your waiting period, your new insurer cannot make you serve a further waiting period.
The process of switching is fairly straightforward. Once you have found the insurer and policy you want to switch to, you simply notify your current insurer of your intention to switch. They will then send a Transfer Certificate to you or your new insurer, which will confirm your level of cover and current waiting period and age loading status.Back to topBack to top
The best* way to get value for money on your health insurance is to shop around. Comparing policies can reveal a variety of money-saving opportunities. Other ways to save include:.
- Paying your premium in advance to avoid the administration fees associated with monthly payments
- Paying by direct debit, which will earn you a discount with some insurers
- Paying a higher excess to lower your premium
- Joining a restricted membership fund if you are eligible, as the premiums are usually lower and benefits to members higher
- Taking out health cover through your super fund, as many negotiate discounts with health insurers.
If you live in New South Wales or Australian Capital Territory, you may want to get ambulance cover as the only people that are provided with free ambulance cover are low income earners and pensioners. Emergency ambulance services are provided free by the State Governments of Queensland and Tasmania.
|Private or public?||Is ambulance covered?|
|Private health insurance|
|Private or public?||What is or isn't covered?|
|Private health insurance|
Extras (general treatment)
Medicare will reimburse 100% of the MBS fee for a general practitioner and 85% of the MBS fee for a specialist if you visit a doctor outside a hospital. If your doctor bulk bills then you wont pay a cent.
|Private or public?||What can you get benefits for?|
|Private health insurance|
Thanks to the Pharmaceutical Benefits Scheme (PBS), you only pay for a portion of the cost of prescription medications. The amount varies depending on the medication up to a standard maximum.
|Private or public?||Are pharmaceuticals covered?|
|Private health insurance|
In keeping with the theme of finding the best health insurance* for your needs, here are some tips you may find useful in your search:
- Review your existing cover at least once a year, as a better deal may have come along in the meantime or your circumstances may have changed
- Don’t be afraid to switch, as legislation now ensures your benefits and current status will travel with you
- Mix and match your hospital and extras cover, as two different insurers may have the best* offers on each
- Select a higher excess if you can afford it and you feel you are unlikely to need hospital treatment in the near future, as this will reduce the cost of your premium
- If insuring your family, look for a policy with individual benefit limits rather than overall capped limits on extras
- Avoid hospital cover that has both an excess and a co-payment, otherwise you could end up paying a lump sum on admission and a further amount for every day you are in hospital
- Make sure your policy includes full ambulance cover, not just emergency ambulance cover
- To avoid paying a gap, make sure your preferred doctor and hospital both have agreements with your health fund
- Whose health insurance premiums have gone up the most?
- Australia’s public hospital performance problems
- The top five private health insurance complaints
- How switching health insurance now will save you more money
- Australians looking to leave health insurers
- FULL ROUNDUP: 2017 health insurance premiums to rise by 4.84%
* The offers compared on this page are chosen from a range of products finder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your personal financial circumstances when comparing products.