Each year, most private health insurance premiums increase, usually from 1 April. While no one likes to see their costs go up, these changes are part of keeping the system sustainable and making sure health funds can continue to cover claims.
Knowing why premiums rise and what you can do in response can help you stay on top of your policy and your budget.
Why do premiums go up?
There are a few common reasons for premium increases:
- Rising healthcare costs. Medical equipment, specialist services, and hospital care all cost more over time.
- More claims are being made. As the population grows and ages, more people are accessing health services.
- Improved treatments. Advances in technology and medicine often come with higher costs.
- Policy and regulatory changes. Government decisions can also influence how premiums are set.
Every year, health funds must apply to the Australian Government for approval before adjusting their premiums. These increases are carefully reviewed to make sure they are fair and based on real costs.
How to stay in control
Premium increases are a regular part of private health insurance, but you have options.
- Review your cover. Make sure your policy still suits your needs and lifestyle. You might find that you can optimise costs by checking in with your fund.
- Switching policies or even funds can be a good way to find better value or coverage. If you’re already with a Members Health Fund, the first step should be talking to your fund to find out if your current policy is effective. If you’re with a for-profit fund, it’s worth remembering that Members Health Funds consistently rate highly for customer satisfaction and fairness. (Link to: Switching health insurance providers)
- Ask about discounts. Some funds offer lower premiums for younger members or for paying by direct debit.
- Consider your private health insurance excess. Increasing your excess can lower your premium, but make sure it’s an amount you’re comfortable paying if you need hospital treatment.
A little attention to your policy each year can make a big difference to how much you pay as well as how well your cover works for you.
Staying engaged with your policy and in touch with your fund can make a big difference to the value you get out of your health cover, and the protection it gives you.