Looking for cheap health insurance?

By looking at extras limits and hospital treatments you can find the cheapest health insurance that works for you and save hundreds.

Smiling woman

Whatever the reason, it's not hard to find cheap cover that works for you.

Compare cheap health insurance

Here you can find some of the cheapest health insurance options from Finder partners. They cover emergency ambulance, dental and other treatments and would make you exempt from the Medicare Levy Surcharge come tax time.

Prices quoted are for a single policy in Sydney with a $500 excess.

Fund Hospital Inclusions Extras include Price per month Apply
ahm logostarter flexi basic package
  • Private Hospital
  • Ambulance Cover
  • General Dental ($550 combined limit)
  • Physiotherapy
  • Chiropractic
$82.15 Go to Site
Medibank logoBasic Everyday Starter
  • Private Hospital
  • Ambulance Cover
  • General Dental ($300)
  • Physiotherapy
  • Chiropractic
$83.80 Go to Site
nib helath insurance logoBasic Essential Hospital Plus + Core Extras
  • Private hospital
  • Ambulance cover
  • Joint Reconstructions
  • Hernia and appendix
  • Unlimited preventative dental
  • Optical ($250)
  • Physio ($350)
$106.02 Go to Site
Basic Hospital + Basic Extras
  • Private hospital
  • Ambulance cover
  • Joint Reconstructions
  • Unlimited preventative dental
  • Optical ($250)
  • Physio ($350)
$107.03 Go to Site

Quotes are based on single individual with less than $90,000 income and living in Sydney.

Compare cheap health insurance options

Use our free tool to see side by side costs from Australian health funds - simply sort your results from 'low to high' price to see cheapest first.

How do I get affordable health insurance?

If you’re young and healthy and don’t expect to need comprehensive hospital cover in the near future, you may be able to just take out basic hospital cover plus cover for those extras you use regularly. But even if you are older and spending more on health cover because your need is greater, there are still ways to reduce your premiums, save and find cheap health cover:

  • Pay your premium annually in advance to avoid paying administration fees
  • Pay your premium before the annual increase (31 March each year) to lock in your current rate for the coming year
  • Pay by direct debit, which many funds reward with a discount
  • Increase your excess to lower your premium. You can choose an excess of up to $750, so look for a plan that offers a $750 option.
  • Join a restricted membership fund (most people are eligible to join at least one such fund) to benefit from lower premiums and higher benefits
  • Take out your medical insurance through your super fund, as it may cost you less and you aren’t required to have a medical exam
  • Don’t pay for things you don’t need, such as pregnancy and IVF cover
  • Take out health cover through your employer if available, as they may have negotiated a discounted rate for staff
  • If you have children, look for policies that waive their hospital excess, offer gap-free extras for children such as dental, and cover dependent children up to the age of 25

What can you expect from low cost medical cover?

As the name suggests, basic health insurance covers only the basics: a core range of hospital treatments and some ancillary services.

Basic hospital cover

What's typically included? What's typically excluded?
  • Emergency ambulance
  • Cardiac-related services
  • Accident-related treatments
  • Non-cosmetic plastic surgery
  • Removal of tonsils
  • Rehabilitation
  • Adenoids
  • Psychiatric services
  • Appendix
  • Palliative care
  • Kidney stones and gallstones
  • Hernia and digestive disorder procedures
  • Cancer related services

Basic extras cover

The average basic extras cover will usually include one or two ancillary services such as:

  • General dental
  • Optical
  • Physiotherapy
  • Chiropractic services

How can I avoid the Medicare Levy Surcharge (MLS)?

The Medicare Levy Surcharge (MLS) is an initiative of the Federal Government, the MLS is designed to reduce the strain on Australia’s public hospital system by encouraging more people to take out private health cover. While all Australians have to pay a 2% Medicare Levy, the MLS is an additional tax on top of that and must be paid by those who earn over a specified level of income but don't have any private hospital cover in place.

The surcharge levels applicable from 1 April 2018 to 31 March 2019 are:

SinglesFamilies ≤$90,000≤$180,000 $90,001-105,000$180,001-210,000 $105,001-140,000$210,001-280,000 ≥$140,001≥$280,001
All ages 0.0% 1.0% 1.25% 1.5%

In order to avoid paying extra tax each year, you will need to take out hospital cover with an excess of:

  • $500 or less per calendar year for singles
  • $1,000 or less per calendar year for couples, families and single parent families

How can I avoid the Lifetime Health Cover (LHC)?

The Lifetime Health Cover (LHC) is an Australian Government initiative designed to encourage Australians to take out hospital cover earlier. If you don’t take out hospital cover with a registered Australian health fund before 1 July following your 31st birthday, you will pay an additional 2% loading on your health insurance premiums for every year you are over 30. For example, if you take out cover when you’re 35 years old, your premiums will cost 10% extra.

Once you’ve paid the LHC loading on your private hospital cover premiums for 10 consecutive years, the loading is removed and if you retain cover the loading will remain at 0%.

What is the difference between the different levels of health insurance?

There are four kinds of private health insurance in Australia:

  • Hospital cover. Hospital covers your expenses when you go to hospital such as accommodation, theatre fees and in-hospital treatment by your doctor.
  • Extras cover. Extras helps you pay for ancillary services not covered by Medicare such as optical, dental and physio treatments.
  • Combined hospital and extras. A hospital and extras policy provides a combination of the above benefits.
  • Ambulance cover. Ambulance cover is available as both standalone and as part of a hospital or extras policy and covers ambulance transport.

There are four types of hospital cover:

  • Public hospital cover. Public hospital covers treatment in a public hospital
  • Basic hospital cover. Basic hospital covers treatment in a private or public hospital, but excludes or restricts cover for things such as cardiac-related services, non-cosmetic plastic surgery, rehab, psychiatric services and palliative care. You might see this referred to as Bronze cover.
  • Medium hospital cover. Medium hospital covers most of what basic hospital cover doesn’t, but usually excludes or restricts pregnancy and birth-related services, IVF, cataract procedures, joint replacements and dialysis. This is sometimes called Silver cover.
  • Top hospital cover. Top hospital covers every service where Medicare pays a benefit. This can also be called Gold cover.

There are three types of extras cover:

  • Basic extras cover. Basic extras makes up all other forms of extras cover
  • Medium extras cover. Medium extras covers general and major dental, endodontic and any five of the following services; optical, orthodontic, physio, chiro, podiatry, psychology, hearing aids and non-PBS pharmaceuticals
  • Comprehensive extras cover. Comprehensive extras covers general and major dental, endodontic, orthodontic, optical, physio, podiatry, psychology and non-PBS pharmaceuticals.

Private vs public healthcare

There is some debate as to which type of cover if better: Public or private health insurance. Below is a comparison table of what's covered by each type:

Private coverMedicare
  • Choice of private of public
  • Your own doctor
  • Choose your own hospital
  • Decide when you're admitted
  • Treated as a public patient
  • Cover by Medicare for 75% of the Medicare Benefits Schedule (MBS), left over costs charged to you, which may be covered by your private insurance. These costs may include:
    • Doctor's fees
    • Medical testing
    • Bandages and consumables
    • Drugs
    • Accommodation
    • Intensive care
    • Prostheses
    • Surgical fees
  • No charge for treatment

Medicare does not cover:

  • Cosmetic surgery
  • Private patient hospital costs
  • Medical services which are not clinically necessary
  • No choice of hospital
  • No choice of doctor

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 CoverMedicare
Your private health insurance may cover:Medicare provides benefits for:
  • Acupuncture
  • Consultation fees
  • Chiropractic services
  • Medical tests
  • Eye therapy
  • Medical exams
  • Contact lenses and glasses
  • Surgery
  • Hearing aids
  • Specific items under the Cleft Lip and Palate Scheme
  • In home care
  • Specific items under the Enhanced Primary Care (EPC) program
  • Dental exams and treatment
  • Surgical procedures performed by approved dentists
  • Physiotherapy
  • Therapeutic procedures
  • Occupational therapy
  • Podiatry
  • Psychology services
  • Speech therapy

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 CoverMedicare
  • You can arrange private health insurance to cover many prescription medicines but you'll still need to make co-payment towards the cost.
  • Not all medications are covered by the PDS

If you live in the ACT or NSW the only people who get free ambulance transport are pensioners and low income earners. In QLD and TAS, ambulance services are free.

Private CoverMedicare
  • Covered by health fund if option is selected
  • Not covered

How much cover do I need?

Everyone’s health insurance needs are different and your age, relationship status and general health will dictate how much cover you ultimately need. Other factors that can influence your decision may include:

  • Do you want your privacy? Whether you are happy to receive hospital treatment in a public hospital under Medicare, or whether you would prefer your own doctor in a private hospital and private room and be treated when you choose, rather than joining a waiting list
  • Do you need extras? Whether you use a particular service regularly such as dental or optical and whether the amount you spend on this is more than the ongoing cost of extras cover
  • Are you a high income earner? If you are a high income earner, whether taking out basic hospital cover is more cost-effective than paying the Medicare Levy Surcharge
  • Do you earn a low income? If you earn a lower income, whether the government rebate on private health insurance is enough to make the cost of taking out cover affordable
  • Are you turning 31? If you are turning 31, whether delaying taking out cover and paying 2% more for every year you delay, will be worth it when you come to need health insurance at a later life stage.

Should I join a restricted fund?

Restricted membership health funds, such as those run through certain employer and industry groups, usually offer higher benefits and lower premiums to members. The reason for this is they are usually not-for-profit funds, which re-invest their profits back into the fund to create better products for members, rather than paying them out as dividends to shareholders.

And although restricted to certain groups of employees and their families, restricted membership funds often allow former employees to join, even if some time has elapsed since they left their former positions.

Restricted membership health funds in Australia include:

Health insurance traps

Whichever level of health insurance you take out, making a claim is basically the same in every case. Here are some general tips that can help ensure the process goes smoothly and that your claim is paid:

  • Don’t lie to your fund. Whether you are taking out a policy or making a claim, you have a Duty of Disclosure.
  • Keep records. Make sure you have all the necessary paperwork required to support your claim, such as hospital and doctor’s bills.
  • Lodge the claim in a timely manner. Lodge claims promptly, as time limits may apply.
  • Go online. If your fund offers an online or mobile claims process, make full use of it, because it will substantially speed up your claim.

There are several traps to be wary of when choosing cheap* health cover and if you’re looking to take out a policy in the near future, it would pay to bear these in mind:

  • Price is not everything. Never choose on the basis of price alone, as the reason many policies are cheap* is because they don’t provide adequate cover.
  • Always read the fine print. While a policy may claim to cover a certain treatment or service, it might only do so to a certain benefit limit or there may circumstances in the exclusions in which it may not be covered.
  • Review your policy. Review your policy regularly (at least once a year), as circumstances change. There may be a better deal out there that you’re missing out on, or your own circumstances (and coverage needs) may have changed.

Tips for getting cheap insurance without compromising on cover

If your motivation for taking our basic health cover is not to avoid the MLS, but simply because you can’t afford a more comprehensive policy, there are a number of ways you can reduce the cost of your premiums while still maintaining an adequate level of cover. These include:

  • Customising your policy so that you are only paying for the treatments and services you actually need (e.g. drop pregnancy services and IVF if they are of no use to you).
  • Increasing your excess (the amount you must pay upfront for treatment). This can reduce your premium, but make sure you will have the money for the excess if you need it at short notice. The highest excess insurers are allowed to offer is $750.
  • Paying your premiums annually and by direct debit (many insurers offer a discount for this).
  • Paying before 31 March when the annual indexed premium price rise occurs to lock in your cover at the current price for another year.
  • If you find a policy that offers a better deal for the same price or less, switch to a new provider.
  • Joining a restricted membership fund if you are eligible (employers, clubs, associations and mutual banks often provide cheaper health insurance to their members).
  • Taking out health insurance through your superfund, as it is often cheaper and you don’t need a medical exam.
  • Looking for policies that offer value for money such as no hospital excesses and gap-free extras for kids (if you have children).

What is the private health insurance rebate?

Not everyone can afford private health cover, which is why the government offers an annual rebate, the size of which is determined by your income level. It is designed to make it more affordable and encourage more people to take out private cover and the income threshold level for singles is set at $140,000 a year and $280,000 a year for families.

As well as your income, to be eligible for the rebate, you must be eligible for Medicare and be a member of a registered private health fund. You can claim your rebate either from your fund (in the form of a premium discount), from Medicare or on your annual tax return.

The rebate and surcharge levels applicable from 1 April 2019 to 31 March 2020 are:

Age 65-69
Age 70+

What are waiting periods?

As with all forms of insurance, certain waiting periods apply before a claim can be made. The reason for this is to prevent someone from taking out a policy, making a claim immediately and then cancelling the policy. This not only costs the fund but every member of the health fund and would soon push up premiums if not controlled by a waiting period.

While waiting periods vary with funds, those typical for hospital cover include:

Service Waiting period
Accidental injury 1 day
Ambulance 1 day
Psychiatric care 2 months
Rehab 2 months
Palliative care 2 months
Other hospital services 2 months
Obstetric conditions 12 months
Pre-existing ailments 12 months

Waiting periods for extras cover typically involve:

Service Waiting period
Ambulance 1 day
All other services 2 months
Optical 6 months
Healthier lifestyle services 6 months
Specialty dental and dentures 12 months
Hearing aids 36 months

Should I switch private health funds?

Many people are reluctant to switch to a less expensive health fund because they fear they will lose their current benefits and entitlements. Due to recent legislation changes, this is no longer the case and switching is now a much easier and more straightforward process.

You may want to switch because your current policy is no longer meeting your needs, or you may have found a better deal with another fund. Whatever your reason, you can switch without penalty, providing your current policy is paid and up-to-date. Your current benefits will travel with you to your new fund, including:

  • Your Lifetime Health Cover status. Whatever your current age loading is (if any), this will remain the same
  • Your government rebate. As long as you aren’t changing your level of cover, you will receive the same rebate you received last year
  • Your waiting period exemption. Any waiting periods you have already served remain in force and your new fund can’t make you serve a new waiting period.

To switch, simply notify your current insurance fund of your intention to switch and they will send a Transfer Certificate to you or your new fund. This confirms your level of cover and current status regarding age loading and waiting periods.

Take advantage of these sign-up deals for October 2019

nib Health Insurance Deal nib Health Insurance Deal

Get up to $300 off your health insurance.

Offer available to new customers signing up for Hospital + Extras

Last verified

Get deal

Deal ends

ahm Deals ahm Deals

Get 1 month free health insurance

Offer applies to new customers signing up for both hospital + extras cover.

Last verified

Coupon code ends

Medibank Health Insurance Deals Medibank Health Insurance Deals

Waive 2 & 6 month waiting periods on extras. PLUS Get a Specsavers gift card worth up to $400.

Offer applies on eligible Medibank Hospital and Extras. Claim straight away for many extras including optical and general dental.

Last verified

Coupon code ends

Qantas Health Insurance Deals Qantas Health Insurance Deals

Earn up to 25,000 Qantas points. Plus, earn 1 point per $1 spent on your premium

Offer applies when joining hospital + extras cover. T&Cs apply.

Last verified

CUA Health Deals CUA Health Deals

Waive 2 & 6 month waiting periods on extras

When signing up for combined hospital & extras cover.

Last verified

Get deal

Deal ends

Popular Health Insurance Deals coupon codes

Last checked Code description Code
11 Oct 2019 Get 1 month free health insurance MO****
8 Oct 2019 Waive 2 & 6 month waiting periods on extras. PLUS Get a Specsavers gift card worth up to $400. SPE****
1 Oct 2019 Get up to $300 off your health insurance. ********
3 Oct 2019 Earn up to 25,000 Qantas points. Plus, earn 1 point per $1 spent on your premium ********
1 Oct 2019 Waive 2 & 6 month waiting periods on extras ********

Latest headlines

*The products compared on this page are chosen from a range of offers available to us and are not representative of all the products available in the market. There is no perfect order or perfect ranking system for the products we list on our Site, so we provide you with the functionality to self-select, re-order and compare products. The initial display order is influenced by a range of factors including conversion rates, product costs and commercial arrangements, so please don't interpret the listing order as an endorsement or recommendation from us. We're happy to provide you with the tools you need to make better decisions, but we'd like you to make your own decisions and compare and assess products based on your own preferences, circumstances and needs.

Picture: Shutterstock

Was this content helpful to you? No  Yes

You might like these...

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.

2 Responses

  1. Default Gravatar
    SueFebruary 9, 2017

    Can I claim gym membership with extras only cover?

    • Avatarfinder Customer Care
      RichardFebruary 10, 2017Staff

      Hi Sue,

      Thanks for getting in touch. Some funds will provide you with discounted gym memberships but it will depend on your policy. For more information, please head over to our health insurance and gym memberships article where you will find what you may be able to claim from each fund.


Ask a question
Go to site