April the 1st is commonly known as April Fool’s Day. It is also the day that many people’s health insurance premiums increase. For some, this increase can correspond with higher levels of cover or increased access for more services and for others it can just be an increase with no real changes to their policy.
The following is an excerpt from the Australian Dental Association about a report by Choice regarding Extras Cover with private health insurers.
Following the announcement that the Federal Government will permit private health insurance premiums to increase by 5.59%, consumer body Choice is encouraging health fund members to consider dropping their extras insurance unless they are confident of receiving more in benefits than they are paying in premiums.
The organisation says fund members need to weigh up whether they do get financial benefits from their extras insurance which covers costs such as dental check-ups. Choice says an analysis of extras cover shows low average payout rates and savings of up to 45% available to consumers who drop it.
According to Choice, the 5.59% average premium increase will see a 48.3% cumulative premium increase since 2009 and comes two weeks after Medibank announced a 58% jump in net profit.
The Federal Health Minister Ms Sussan Ley said that some of 40,000-plus health fund policies are “clearly junk”. “I’m particularly concerned when I hear of patients unsure of what they’re covered for or how much they’ll be out of pocket, despite being a loyal customer for many years,” she said. Ms Ley said as part of her reform discussions with the private health industry, she is “investigating ways to ensure consumers can compare apples with apples when they shop around”. Her report can be read here.
Meanwhile, consumers wanting free, independent comparison advice on health policies should visit the Private Health Insurance Ombudsman’s website.
Consumer advocacy group Choice has identified seven popular “junk‟ private health insurance policies that it says are a waste of money for consumers and taxpayers, and is calling on the Federal Government to act. These policies, from Medibank, NIB, HCF and others, come with restrictions and exclusions for the vast majority of treatments with little benefit above what is already provided through Medicare, according to Choice. “Our analysis shows that in many cases, junk policies cover less than 1% of the services available in hospital, and exclude treatment for the most common serious illnesses such as cancer, stroke and heart disease,” says Choice Head of Media Tom Godfrey. Choice recently encouraged health fund members to consider dropping their extras (mainly dental) insurance unless they are confident of receiving more in benefits than they are paying in premiums.
For more about the information provided by Choice about Extras with Private Health Insurance visit the following link