If you’re a private health insurance member, you’re probably all too familiar with both the rising cost of premiums each year and the constant internal battle of “is private cover really worth it?”
It’s certainly frustrating dishing out your hard-earned cash for something that you don’t necessarily see a return from in the short term. Especially if you’re fit and healthy and can’t even remember the last time you even had a cold.
So as the second premium rate rise in just six months looms on April 1st and premiums creep up again, this time by an average of 2.74 per cent, it could be time for you to finally sit down with your private health insurance over a glass of wine, look it dead in the eye and say ‘is this really working?’
Here a few questions prompts to get the conversation started.
1. Do I mind waiting longer for elective surgery?
Elective surgery wait times in many public hospitals within Australia have recently skyrocketed due to the COVID-19 backlog.
Elective surgery, while not an emergency, is still considered medically necessary and can include things like the removal of wisdom teeth and tonsils, a knee replacement or a joint replacement which could be more likely if you’re into your sports or work on the tools.
Consider whether you’d be comfortable to wait longer in the public system for elective surgery and how this might affect your income should your injury stop you from working. As a private patient, the wait times for elective surgery are generally shorter.
2. Would I like my own choice of doctor and hospital?
A common reason for Aussies to opt into private health insurance is for the freedom to choose their doctor should they require treatment.
For example, if you were having a baby you would have the option to choose your own obstetrician for consistent care and at hospital close to home if you prefer.
If choice of doctor/hospital doesn’t phase you, then perhaps put a strike down in your ‘cons’ column now.
3. Am I benefiting from Extras cover?
Extras is another key reason why Aussies find value in private health insurance. If you’re someone who makes frequent trips to the dentist or physio or perhaps you wear glasses or contacts then Extras may be well worth it to cover services not covered by Medicare.
If you’re not sure whether you’re squeezing the most out of your Extras, you can explore flexible limits on your Extras so that they are tailored towards the benefits you use the most.
Or simply dropping your Extras cover and keeping Hospital only could work out cheaper for if you feel your Extras aren’t working hard enough for you.
4. Are you comfortable paying extra tax?
If you’re thinking ‘times up’ on your private health insurance all together, consider that you may then pay extra in tax if your taxable income is over $90,000 as a single or $180,000 as a combined household and don’t have private hospital cover.
Thanks to the Medicare Levy Surcharge (MLS), if you’re earning over this amount you could be stung at least $900 extra in tax each year.
Would you prefer to give this cash to the tax man or keep at least a basic level of hospital cover for a little more?
5. Am I paying for cover I don’t even need?
You can have your cake and eat it too, meaning you can keep your private health insurance but save yourself some money at the same time.
All you need to do is review your policy regularly to make sure you’re not paying for things you don’t need. There are health insurance comparison services available that can help you work through what a suitable level of cover looks like for you across a range of policies and funds*.
You could be paying a bucket load for things like obstetrics when you really aren’t on the baby making page of your life right now. So it can pay, quite literally, to shop around and review your policy to make sure you’re not paying for things you don’t need.
You may even be able to opt for a higher excess in an effort to reduce your monthly premiums if you think it’s unlikely you’ll be admitted to hospital anytime soon.
So there you have it; five conversation starters to have with yourself on whether your private health insurance is really worth it for you.
Whatever you decide, before ditching your cover all together, consider checking out if you can first save money on your current policy.
It’s not an urban legend, it is possible to find a similar level of cover with a different fund that could be kinder to your bank account.
Disclaimer: iSelect does not compare all health insurance providers or policies in the market. The availability of policies will change from time to time. Not all policies available from its providers are compared by iSelect and due to commercial arrangements, your stated needs and circumstances, not all policies compared by iSelect are available to all customers. Some policies and special offers are available only from iSelect’s contact centre or website. Click here to view iSelect's range of providers.
Jessie Petterd is a spokesperson for iSelect.
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