One vital fact that you should be aware of – if you don't know already – is that health insurance premiums are going to increase by an average of 5.6 per cent this April.
This premium increase is attributed to factors such as hospital staff wages and the cost of medical equipment and technology.
Chief executive officer of Private Healthcare Australia said that the increase was necessary to ensure that funds remain "financially viable, meet statutory prudential requirements; and, most importantly continue to provide members with access to quality health care".
The impending premium increase has some families and individuals across Australia comparing health insurance policies to find a better deal that suits not only their medical needs but also their financial needs too.
The federal government is backing this move to compare health insurance, so that families can choose a policy that best suits them.
There are a number of other health insurance elements that it's important to be clear about, so you know that you are getting the best out of your plan.
This is the amount that you pay for medical or hospital charges that is "over and above" what you get back from Medicare or your private health insurer.
You may want to check with your health fund if there is a gap cover arrangement available to help insure against some or all of these additional payments.
The Private Health Insurance Ombudsman (PHIO) suggests you ask your doctor for an estimate of their costs, if there will be other doctors involved in your care (assistant surgeon, anaesthetist, etc) and what their charges will be.
A number of hospitals have arrangements with health funds to partially or fully cover costs related to hospital accommodation, but if you go to a hospital that doesn't have an agreement you'll potentially face "significant out-of-pocket" expenses for your treatment.
Lifetime Health Cover
Lifetime Health Cover is designed to encourage people to take out health insurance earlier in life and to maintain their cover.
If you don't have hospital cover with an Australian-registered health fund on July 1 following your 31st birthday and decide to take out cover later in life, you will have to pay a two per cent loading on top of your premium for every year that you are aged over 30.
When you have paid a LHC loading on your private health cover for ten continuous years, the loading is then removed, as long as you keep your hospital cover.
If you were born on or before July 1 1934, you are exempt from LHC and can take out health insurance at anytime, paying the same premium as someone who takes out cover at age 30.
Private Health Insurance Rebate
Many Australians with private health insurance receive a rebate from the Australian government to help cover the cost of their premiums, with this rebate income tested.
You can check if you are eligible for a rebate by following this link to the PHIO website.
The Medicare Levy Surcharge (MLS)
This is levied on "payers of Australian tax" that don't have private hospital cover and earn above a certain amount.
This surcharge aims to "encourage individuals" to take out private hospital cover, and where possible, use the private system to "reduce the demand" on the public Medicare system.
Excess or co-payment
The excess is the amount of money that you agree to pay for a hospital stay before your health insurance benefits are payable.
A co-payment means you agree to pay a set amount each day you are in hospital.
You can find out more information about these two health insurance elements in the article, Managing your health insurance: Lowering premiums and health fund discounts.