Australia's private health insurance is a beast with many arms, and they're all flailing in different directions. Focus on your Medicare levy surcharge for too long, and you might get blindsided by lifetime health cover; try and get your head around which health fund to go with, and you might miss important deadlines and end up paying more.
There's extras, excesses and exclusions to comprehend – and they're just three things beginning with 'E'; there's a whole alphabet of health insurance words to add to your vocabulary. All of these minutiae you'll want to understand to make sure you aren't paying too much for private health cover or underinsuring yourself.
If we could write a whole glossary, we would, but it's probably best to get in touch and let us answer your most specific questions. Saying that, there are some common dos and don'ts when it comes to private health cover that are worth explaining.
If you're thinking of taking out health insurance, or if you're looking to renew your policy, here are a few examples.
Look at your health insurance before turning 31
Lifetime health cover (LHC) is an incentive for all Australians to take out private health insurance, simply because it will cost you more after 1 July following your 31st birthday. People under that age will pay the base rate, whereas someone who takes out their first policy after that date will have a 2 per cent premium loading added to the cost of their policy for each and every year they remain without cover, up to a maximum of 70 per cent.
We encourage buyers to get in touch and let us compare health insurance on your behalf.
Check to see if your employer offers health insurance
A number of employers offer corporate health insurance. For them, it helps to limit the amount of time people have off sick by providing them with healthcare that is often quicker. For you, the employee, you'll receive free or subsidised private care. Some superannuation and mutual funds also offer cover, so check if you're already entitled to health insurance before spending your money on it yourself
Declare any pre-existing medical conditions
When you take out health insurance, it's imperative that you tell your health fund about any pre-existing medical conditions – even if they're undiagnosed. Not doing so could leave you uninsured should these problems require treatment or surgery.
You might also have to serve a 12-month waiting period before you're covered for that particular health condition. Either way, by being honest, you'll likely find yourself fully insured in the end if there is cover under the policy for that specific condition.
Compare health insurance
That policy you're looking at: how do you know there's not an identical or even better one provided by a different health fund, and for a better price? With 34 health providers all trying to sell you their products, unless you do your research, you won't be able to.
That's why we encourage buyers to get in touch and let us compare health insurance on your behalf. It's usually free, and we'll use our expertise to sniff out a policy that suits you and your family.
Miss the April 1 deadline for premium increases
On April 1, 2016, every health fund will put up its premiums to help them keep up with the cost of modern healthcare. They do this each year, and it can put a strain on a family's finances.
Along with encouraging you to compare health insurers to find a budget-friendly deal, we also advocate that you act before this deadline. Buying an annual policy will set you up with the pre-April premium rate for 12 months, instead of the higher one.
Australians struggling to afford their private health benefits are growing increasingly likely to take out a "junk policy".
Go for the cheapest policy you find
Australians struggling to afford their private health benefits are growing increasingly likely to take out a "junk policy". While they think it's saving them money, it's actually leading to them paying for insurance that does not meet their needs. Underinsurance is a huge issue, which is why we encourage you to focus on quality, not just cost. We can help you balance the two.
Let yourself be confused
If you find yourself wrestling with the many flailing limbs of the health insurance monster, take a breath and seek advice. You're likely to make a rash decision if you let yourself get confused by the jargon and the idioms that some will throw about in the industry.
It's also not uncommon. According to the Consumer Health Forum of Australia, only one in four people find taking out insurance easy. As we say, the beast is difficult to tame, so take your time and don't feel bad for reaching out to a professional for advice.
Think about insurance from an early age
Along with LHC, there are plenty of reasons to take health insurance to heart, even as a young and fit Australian. Unfortunately, we never know what's around the corner, though we can prepare to meet most of it with health cover.
Young Australians have been urged to take better care of their financial, physical and mental health, which includes having a cost-effective policy covering them for accidents, illness or injury. If you haven't thought about it too much yet, we'll be happy to clear up some of the finer points around private health cover.
Give HICA a call on 1300 44 22 01 if you'd like to discuss your health insurance needs in more detail.