Based on the new rebate system introduced by the Gillard government, health insurance premiums are set to increase dramatically from July 1. If you are classified as a high income earner – for example, a single person earning over $130,000 – the rebate on your health insurance would be slashed from 30 per cent to nil.
Most people have not done the sums; the entire loss of the 30 per cent rebate means that – for singles and families – premiums will increase by approximately 43 per cent. In the case of older Australians – whose rebates can be as high as 40 per cent – premiums will increase by a staggering 66 per cent if they do not qualify for a rebate.
It is important to not only periodically review and compare health insurance policies, but also to seek advice on strategies to lock in the current rebate for as long as possible. Some health funds are allowing clients to make advance payments in a bid to reduce the financial impact, as the means testing only applies to premiums paid on or after July 1.
Health Insurance Consultants Australia is one of Australia’s largest health insurance brokers dealing with a range of health funds. Each provider will approach this situation differently, so it is important to understand the options being offered by your health fund. There are significant advantages in being able to forestall the application of the new rebate.