The vast majority of people use the new year as a blank slate. Whether it's a different job, change of diet, or even just altering a few lifestyle choices, January 1 can be a great time to start fresh. However, is this the case when it comes to private health insurance?
Well, in Australia, the vast majority of health funds assess their pricing structures once a year, and this can often happen when the calendar ticks over from December to January. In fact, Bupa explained that the process tends to work on a timeline as follows from the perspective of health funds:
- November – December: The health funds assess their prices, looks at competition in the market and decide as to whether any changes need to be made.
- January – February: Proposed alterations are sent through to the government to be ratified, with approval for pricing amendments typically granted in February.
- April: Changes are pushed through at the consumer level, and become effective as of April 1.
So, with that timeline in mind, while it may seem like reassessing your health insurance policy is something that can be left for the new year, it's well worth considering now if you're looking to unlock the most value for money.
Offsetting the rise
As touched on, health funds are regulated by the government to ensure that they don't increase their prices unjustly. However, that's not to say that changes are avoidable. For example, exterior market conditions, the wider economy, and the rising costs of treatments can all play a part in health insurance premium alterations.
In the case of the latter in particular, Bupa found that the average cost of a heart bypass hit $42,679 in 2014. Naturally, there's actually a contradiction here. The health funds increase prices to cover costs on their end, but consumers need cover in case they have to undergo a costly treatment.
Consequently, from a customer perspective, unlocking all of the value from your existing policy, or even taking out a new one that could offer more, is an issue that should be proactively tackled.
Private health insurance prices increased by 6.18 per cent this year.
What happened this year?
The increases in prices can happen yearly, as outlined above. So, what kind of increases were handed over to consumers in 2015? Well, when that April 1 deadline came around, health funds added a further 6.18 per cent of costs onto their policies, according to ABC News.
At the time, Health Minister Susan Ley was keen to point out that the government had ratified the increases with consumers' best interests at heart.
"It's essential for the health of our nation that we continue to maintain a strong and competitive market. We must ensure any premiums increases strike the right balance between keeping them affordable for consumers without putting the financial viability of the sector at risk," she explained, as quoted by ABC News.
"With over 30 private health funds now operating in the Australian market, my strong advice to consumers is shop around to get the best deal if you are unhappy with your health fund's offering," Ms Ley concluded.
— ABC News (@abcnews) February 27, 2015
HICA's helping hand
So, if you'd like to follow the advice of Ms Ley, offset any pricing changes before they happen, and find a policy that perfectly fits your needs, what's the best starting point? Well, it's a case of getting advice from the right place, and consulting with people who have a raft of experience.
To that end, if you'd like impartial advice on health insurance, and are looking to protect your health and wellbeing in the long term, give one of HICA's experts a call today on 1300 44 02 01.