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Australian Consumers Should Research Health Insurance Policies


The beginning of April has come and gone, bringing with it another 5.6% increase to the cost of health care, which is already too expensive for many people to afford. Despite the rising costs consumers have been urged not to exclude too much from their policies to try and balance the increases out. Cutting back on health care might save you now but it’s a practice that is definitely going to cost you more in the long run.The new increases mean that the average single person is now paying $1.70 extra per week while the average family is being lumped with an additional $3.70 per week.

In order to get around the unwelcome increases government has urged consumers to start shopping around so they can make the most informed choice. Health experts however have urged people to focus more on the value their policies offer, instead of turning it into a purely monetary issue. It is always easy to find cheaper policies when you compare health insurance, but they definitely do not offer consumers the same level of care.

According to the Private Health Insurance Administration Council, in 2011, 60% of consumers took out policies that had exclusions, an increase from 38% in 2006. The private insurance ombudsman was also quoted as saying that the figure had gone down during the last quarter. When people do opt for exclusions it tends to be more expensive features that are given the boot, like psychiatry, cardiac surgery and orthopaedics and these can be virtually impossible to afford when you do not have cover and have to pay for it out of pocket. And the way it plays out in reality is that many people may not even be aware of their specific exclusions until they have started treatment in a private environment and are liable for the cost.

Not being able to afford the cost of certain procedures and treatments or going into debt to have it covered privately is an individual problem but it also puts the public system under a lot of pressure when people have to rely on state assistance.

Data reports that around 12% of those who make use of the public system have private insurance. There is a lot of debate about whether it is right or wrong but whatever you believe, the fact is that the government’s attempts to improve healthcare through privatisation have backfired to some degree. While it is true that people with health cover are stopping those who rely on state welfare because they have no other options, if they have chronic health problems their private cover is not adequate for their medical needs either, resting in unaffordable out of pocket costs.

Policies are not exhaustive or completely comprehensive and if you have a bad run or suffer from a chronic condition you are going to reach your threshold at some point. Everyone is recommended to compare health insurance premiums and inclusions on an annual basis to make sure they are still getting good vale from their package.

The chief executive of the country’s largest insurance provider says questions regarding the ownership of the organisation have been floating around for years and that it is focused on other prevailing challenges. Comparison websites like Help Me Choose have become incredibly popular in the last few months as people have taken to the convenience of online comparisons for health insurance prices and products.

Insurance companies also have to cope with the increasing numbers of drop offs and downgrades as income testing has caused people to start taking a more considered approach to the financial viability of having access to private cover.

Labour has indicated it does not support a sale of the organisation while the Coalition believes it is a good idea. The Greens have offered a better alternative by saying they will give their support to a sale if the proceeds are used for the upliftment of the public health sector. Inflated claims costs saw the insurance provider’s national profit drop by 57% to $126.6million for the 2012 financial year. Even so revenue has managed to record highs for the second consecutive year, of $5.4billion. The other insurance providers remained fairly positive about the proposed privatisation, saying it will introduce health competition to the market.