Every year we’re put through the rigorous task of checking to make sure our Health Insurance policies are the right ones for us. Come April 1 this year, private health insurance reforms are taking place and are shaking up more than just the prices.
We wanted to give you the basic breakdown of the changes and what they mean according to the Department of Health.
Changes to the system
The major changes that will impact you and your policy are as follow:
- A four-tier system will be introduced – Gold, Silver, Bronze or Basic.
- Discounts for young people aged between 18 and 29 may apply.
- Higher excesses will mean lower premiums.
- Travel and accommodation concessions for people needing to travel long distance for hospital treatment.
- Improved access to mental health treatments by waiving the waiting periods on hospital cover when it’s upgraded.
- Certain benefits under “natural therapies” will be withdrawn meaning naturopathy will no longer be covered amongst others.
- The Private Health Insurance Ombudsman has new powers to investigate complaints and issues.
Source: Department of Health
What this means
Removing the various types of policies that have been in play in the past, the tiers aim to establish a simpler more refined system. The types of services covered in these tiers will be placed in “clinical categories”. These are types of hospital treatments that are meant to be described in a simpler way, so everyone can be clear about what they are. These “clinical Categories” have been put in place to standardise health insurance across all providers to make it easier to choose the right policy.
However, according to Choice, this move has meant that from the previous 12 categories of often-excluded treatments, there will now be 38 categories. The problem now lies with the clarity of these definitions. For instance, Choice has used the example of Chemotherapy. They advise that under the new tiers it is covered under Bronze policies, but cancer surgery cover will depend on which clinical category it falls under. So, if you’re having lung cancer surgery, this would only be covered by Silver and Gold policies.
To add to the confusion, insurers can also offer Basic Plus, Bronze Plus and Silver Plus policies that cover additional treatments available in higher categories. An example would be for Bronze Plus which could contain all Bronze treatments with Heart surgery as an additional treatment.
Under the new reforms, if you’re already covered, your policy will shift over to one of the tiers. Your insurer should advise you of what tier your policy will be placed in.
Because of the health insurance reforms, it’s a good idea to review your policy and decide what’s right for you. Note that the changes to the system will take full effect in 2020 when everyone will be shifted over to the new tiers. So for now, your policy may stay the same.
The Rise of Premiums
And like every year, the government rebate is decreasing, and health premiums are set to rise. Below is a breakdown of the premium increases from 2010-2018.
Health insurance premiums will still be on the rise by approximately 3.25%. According to Canstar, you can decrease your premiums by making your excess higher.
To make life more affordable and ensure you’ve got the right cover for your lifestyle, there are two things you should consider. Reviewing your current policy and listing any additions or subtractions you need to make. Once you’ve done that, search for similar policies and compare prices. If you’re between the ages of 18-29 make sure you ask the insurer if you’re entitled to a discount on your cover.
With premiums on the increase, you’ll want to make sure you get the best deal and cover around. One way to do this is by earning Cashback at Bupa. The bonus is that according to Canstar, “Bupa has bucked the trend and will deliver a hike of 2.99% which is well below the industry average.”
No matter what policy you go for, make sure you do your research and fully understand the changes to ensure that it’s right for you!
Disclaimer: Some items in this article may not be eligible for Cashback. Deals, products, displayed prices, Cashback rates and available retailers through CASHREWARDS mentioned above may change at any time without notice. This article has not been specifically sponsored in any way, by any retailer. Although CASHREWARDS has ongoing partnerships with the stores mentioned above in order to provide you Cashback at these stores.