Australians urged to shop around as health insurance premiums jump

Millions of Australians with private health insurance will see their premiums rise by more than 5 per cent within weeks. Consumer advocates say the price hike is lower than many of the health funds had wanted, but more than a lot of consumers can afford.

Australians urged to shop around as health insurance premiums jumpAustralians urged to shop around as health insurance premiums jump

Australians urged to shop around as health insurance premiums jump

Over 13 million Australians have private health insurance.

 

From April 1 they'll be paying 5-point-6 per cent more on average for cover.

 

Consumers Health Forum spokesman Mark Metherell says the price hike will hit many people hard.

 

"This latest rise if about 3 times the rate of inflation in the last year. So it is making it harder for people to keep insurance. Many are having to think of dropping it or reducing their cover."

 

The price hike is less than last year - when premiums rose almost 6-point-2 per cent - but it comes as some health funds post record profits.

 

In January, the Federal Health Minister Sussan Ley asked health funds to lower their premium increases.

 

She says 20 did, with some cutting back as much as 1-point-5 per cent.

 

A body that lobbies for the health insurance industry says fee increases are needed to help funds cope with the rising cost of hospital beds and medical specialists, as well as an increase in demand from the country's ageing population.

 

Private Healthcare Australia says for premiums to remain affordable prostheses pricing regulations need to be changed.

 

Currently the federal government sets the price private health insurers must pay for medical devices, such as hip and knee joints.

 

The Chief Executive of Private Healthcare Australia, Doctor Rachel David, says in some cases funds are having to pay up to five times more than international consumers.

 

She says reform is crucial.

 

"We believe that would save our members in the order of 800-million dollars per year. We have agreed to pass that back as a discount on premium increases in future."

 

The federal government is looking at the problem, and Sussan Ley says consumers could begin to see savings from next year.

 

Meantime, she has urged people to shop around for the product that best suits them.

 

"You should revisit your product every couple of years to see if it is exactly what you need. You should demand answers from your private health insurer. You should ask questions. And you often can get a better deal."

 

Mark Wetherell from the Consumers Health Forum says finding a better deal on comparison websites can be complicated and frustrating.

 

"There's so many different levels of cover, restrictions, exclusions. So it is very hard for the consumer to get really to get an apples with apples type comparison. And that's what we are arguing for. That there should be some sort of standardised platform for consumers to easily compare one health fund policy with another."

 

The consumer advocacy group Choice says people should ask themselves if they need certain products.

 

Spokesman Tom Godfrey says Extras Insurance is often poor value.

 

"Obviously having hospital insurance is useful. But extra insurance you don't get a tax penalty for dropping that. And if you do drop it you can save about 45 per cent on your annual premium which can be as much as 2,000 dollars."






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