Yahoo Finance ‘DUMP THEM’: Insurers blasted for rip-off products
Australians have been urged to double-check they’re getting their money’s worth from their health insurance, following a damning new survey from consumer advocate CHOICE.
Some Australians with Bronze hospital insurance policies are paying more but receiving less cover than their counterparts with Silver policies, CHOICE research has revealed this week.
Bronze policies generally give cover for broken bones, breast and prostate cancer treatment and diabetes treatment, while Silver and Gold policies provide broader cover. Silver in particular will include treatment for heart disease, leukemia and lung cancer and medically necessary plastic surgery.
However, CHOICE has found 73 Bronze and Bronze Plus hospital insurance policies that cost more than some Silver products, despite providing less coverage.
“COVID-19 means many people are experiencing financial hardship – now's the time to dump these overpriced policies and switch for better value cover,” the consumer comparison platform said.
CHOICE found Frank (GMHBA) Better (Bronze+), $750 excess, and Phoenix Bronze Plus Care, $500 and $750 excess levels, are two policies which are more expensive than at least one Silver policy across Australia.
However, it said there are significantly more Bronze policies that cost more than Silver policies when looking at individual state levels.
Why is this happening?
The Government introduced health insurance reforms in 2019 designed to make choosing an appropriate level of coverage easier. The four tiers were Gold, Silver, Bronze and Basic, with corresponding costs and coverage.
However, insurers were also allowed to offer Plus policies, which offer at least one service on top of the Gold, Silver, Bronze and Basic.
“While Plus policies allow you to tailor your health insurance, they also make it much harder to compare policies,” CHOICE said.
“For example, a Bronze Plus policy could include cover for lung-cancer surgery and dental surgery – such as wisdom teeth removal in hospital. These are services that would be useful for many people and are normally only covered under Silver policies.
“Another Bronze Plus policy might exclude those things, but cover Cochlear implants, which is also covered by Silver policies, but only useful for a few people.”
CHOICE’s analysis comes amid new figures from the Australian Prudential Regulation Authority (APRA) showing that nearly 35,000 Australians took out new hospital cover policies in December last year.
That’s despite most premiums increasing 3 per cent in October, which normally triggers a drop in membership.
Premiums are also set to rise by about 2.74 per cent again on 1 April, costing families an average $126 more a year.
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