If you and your family have health insurance, one of the top issues on your mind at the moment may be the forthcoming premium changes taking place in April.
The Private Heath Insurance Ombudsman (PHIO) recommends that all consumers review their private health insurance at least once a year.
Take some time out before the premium increases take place to manage and review your current private health cover policy.
If you find that the cost – or impending cost – of your private health insurance plan is exceeding your budget, then there are some ways that you can manage your policy to help you secure lower premiums.
Depending on your situation you may be able to receive discounts from your health fund provider, agree to an excess or to sensibly amend your cover, or get rate protection if you pay for your premiums in advance before the rate increase.
The PHIO states that you can agree to only receive limited benefits for a certain service (restricted benefits), not receive cover for certain services (exclusions) and pay a "set amount" toward the cost of your hospital treatment (excess or co-payment).
What are restricted benefits?
Health insurance holders who have restricted benefits for some conditions will find that they have only limited cover for these.
This means that you will face what the PHIO says is "considerable out-of-pocket" costs if you seek treatment as a private patient.
If you require treatment for a restricted service, you would find that your options are to undertake treatment as a public patient, a private patient in a public hospital or cover some of the cost of the treatment from your own pocket.
What are exclusions?
If your health insurance policy has an exclusion for a condition, you will not be covered for that condition as a private patient in a public or private hospital.
Essentially this means that your health insurer will not pay any benefits toward your medical and hospital costs if your policy does not cover the required area of treatment.
This will likely result in you having to cover the full cost of the treatment yourself or undertake treatment as a public patient.
What is excess?
Excess is sometimes referred to as a 'front-end deductible' and is the amount of money that you as a health insurance holder agree to pay for a hospital stay before your health insurer benefits are payable.
If, for example, your policy has an excess of $300, you will have to pay the first $300 of your hospital costs before you can go to hospital as a private patient.
According to the PHIO, an excess could apply for every time you go to the hospital in a year, otherwise it may be "capped" at a total amount you will have to pay in a year.
What is co-payment?
A co-payment – also known as daily excess, overnight excess or patient moiety – involves you agreeing to pay a set amount for each day that you are in hospital.
If your policy co-payment, for example, involves you having to pay $80 for each day you're in hospital, you would have to pay $320 for a four day stay.
The total amount of co-payment that you are required to pay each hospital stay is often limited to a set maximum amount, the PHIO states.
Health fund discounts
There are some requirements from your health fund that you may qualify for that allows you to receive a discount on your Australian health insurance premium.
This could include paying your premiums at least three months in advance, paying by "pre-arranged" automatic transfer from an account and by payroll deduction.
If you belong to a "contribution group" under the rules of the fund (e.g. health insurance organised by workplace) you may be eligible for a discount, also if you aren't required to pay a state or territory levy then you may also be able to receive a discount.
HICA provides a free professional health insurance review and advice service for Australian individuals, couples and families.