Is your health insurance policy really giving you the best value for money? With reports many health insurance funds are planning large premium increases in 2024, now is the time to review your cover. CHOICE health insurance experts have found that you can save up to $1870 by switching to a different insurer.
"We've been busy crunching the numbers, and we've come up with a number of ways you can save money on your health insurance," says CHOICE health insurance expert Uta Mihm.
1. Switch your hospital insurance to a cheaper Gold, Silver, or Bronze policy
"The same cover with a different insurer can be hundreds of dollars cheaper," says Mihm.
"Whether you have a Gold, Silver or Bronze policy, it's likely that you'll be able to find a cheaper deal that will give you exactly the same amount of cover."
How much can you save?
Gold policy
People with Gold policies could save up to $1870* a year by moving to a cheaper policy.
- ACT and NSW: $1570
- NT: $810
- Qld: $1760
- SA: $1120
- Tas: $1645
- Vic: $1870
- WA: $1035.
Silver policy
People with Silver policies could save up to $1170* a year.
- ACT/NSW: $240
- NT: $1170
- Qld: $305
- SA: $255
- Tas: $315
- Vic: $180
- WA: $555.
Bronze policy
People with Bronze policies could save up to $860*.
- ACT/NSW: $190
- NT: $860
- Qld: $195
- SA: $255
- Tas: $340
- Vic: $225
- WA: $170.
Potential savings are based on comparing the most expensive policies with the cheapest hospital policies with at least the same cover level and the same excess. We looked at annual policies for a single person, with no health insurance rebate, and $750 excess. Source: data.gov.au as of 1 February 2024.
* Figures are rounded to the closest $5.
2. Consider a Plus policy if you don't need the full cover of a Gold or Silver policy
We've caught some health insurers selling rip-off 'Plus' policies, but if you have specific health needs, you may be able to find an affordable Plus policy without paying the full Gold or Silver price. 'Plus' policies cover everything the equivalent policies cover, plus some additional therapies.
"The Bronze, Silver and Gold tiers are meant to make it easier to choose health insurance, but in reality there are a confusing array of 'Plus' options that include some of the best and worst deals in the market," says Mihm.
"If you focus on your specific health needs, you may find Bronze Plus or Silver Plus a cheaper alternative – just watch out for health insurers who try to trick you into unwittingly paying more."
3. Avoid commercial comparison websites when picking a policy
Compare all policies – with no sponsored results – using our health insurance comparison tool.
"Choosing a health insurance policy can be difficult, and you might turn to the first site you find on Google for advice," says Mihm.
"However, it's important to be wary of commercial comparison sites – they may not have your best interests at heart.
"If you buy insurance through a commercial comparison site, for example, they often earn a commission and may not compare much of the health insurance market at all. As a nonprofit consumer advocate, CHOICE independently compares the policies of over 40 health insurers."
If you're looking for an independent health insurance comparison tool, we can help you compare hundreds of options and find the right health insurance for you.
4. See if there's a tax benefit to having health cover
If you earn over $97,000 as a single person or $194,000 as a couple, you'll be charged the Medicare Levy Surcharge, but most Australians don't earn above that threshold.
If you do fall into this category, you could get a Basic policy to avoid the Medicare Levy Surcharge, but we don't recommend these junk policies if you need cover for health reasons.
If you're not sure how your health insurance will affect your tax, you can use our Do I Need Health Insurance? quiz to find out.
5. Consider if you need health insurance at all, especially extras
"CHOICE's longstanding advice is that extras insurance is a glorified savings program," says Mihm.
"Extras can be hard to get value from and you may be better off putting the money you'd spend on an extras policy into a savings account. Whether you have extras or not has no impact on your tax.
"It's clear a lot of Australians are struggling to pay their private health insurance, and it's fair to consider if you're getting value for it at all," says Mihm. "Private health premiums and the out-of-pocket costs that often come with claiming on your health insurance are a significant and unexpected stress for many people. You should not feel pressured to buy private health insurance above other essentials."
Stock images: Getty, unless otherwise stated.
