It's no joke, private health costs are going up
THERE is no way to avoid a price hike if you hold private health insurance.
The Federal Government have confirmed the hike will happen on April 1.
While APRA reported this week that in the quarter to 31 December, 2016, the largest increase in hospital treatment coverage was for people aged between 70 and 74, this increase could slow considerably once the cost of the insurance is known and older Australians are forced to decide if they can afford to continue paying for their cover.
Health Minister Greg Hunt announced last week the average premium increase in 2017 would be 4.84%, the lowest increase in ten years, but it's still an increase.
This hike is 3.3 times the rate of general inflation during 2016.
CHOICE head of media Tom Godfrey said: "It raises concerns that private health insurance is being priced out of the reach of many Australians".
"The 4.84% price hike means the average cost of a single-person hospital policy will increase from $1919 to $2012 before the rebate discount.
"With couples and family policies typically costing twice as much, a family might find themselves spending around $186 a year more on hospital cover," he added.
The government is also introducing cuts to the rebate on private health insurance from April 1.
These rebate amounts, based on income, will be adjusted annually on April 1.
The Base Tier amount for under 65s earning less than $90,000, or $180,000 as a couple, will be about 25.9%.
For people aged 65 to 69 it will be about 30.25% and for people 70 and over it will be about 34.57%
The Department of Health warns: "If you or your family don't have hospital cover, or you choose not to maintain your cover, you may have to pay the Medicare levy surcharge".
Before making a decision as to whether to stop your private cover or continue it, CHOICE is offering the following health insurance saving tips:
- Consider increasing your excess to reduce your premium.
- See if your health fund offers discounts for paying by direct debit.
- Ask yourself if you really need extras cover: if the amount you claim is lower than your premium, consider dropping it.
- Check to see if you can join a restricted membership health fund.
- Pay your annual premium in March to put off the April 1 price hike until next year.
CHOICE recently launched a free website, http://www.doineedhealthinsurance.com.au as a valuable health check to see if there's any tax benefit to paying for hospital cover.