Frugal Private Health Insurance Comparison
When money is tight, private health insurance may seem like an expensive luxury. In Australia, we are lucky enough to have a great health care system in the form of Medicare, but it doesn’t cover every health care expense. To make sure that you’re more extensively covered, you might consider buying private health insurance as an investment in your health – viewed this way, rather than as a luxury, it may find a space in your budget after all.
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Fitting health insurance premiums into your budget can be tricky, but here is some good news on that front. There are ways to bring down the costs without skimping on your cover, and here are some tips on doing just that.
Sign up early
This is an easy way to pay less for private health insurance if you’re still relatively young. Through Lifetime Health Cover, you can ‘lock in’ cheaper premiums for life if you take out private hospital cover before the 1st July in the year that you turn 31 years old. If you sign up after this, there is a 2% loading fee on top of premiums for each year that you delayed, so if private hospital cover is in your plans, it’s well worth arranging cover sooner rather than later.
Pay upfront
Generally speaking, private health insurance premiums tend to increase year-on-year but you may be able to avoid this by paying annual premiums upfront to ‘lock in’ the cheaper rate. Speak to your insurer about whether this is an option for you.
Pay by Direct Debit
Even if you’re not in a position to pay your premiums upfront, you may still have an opportunity to reduce the costs if your monthly premiums are paid via Direct Debit. Some health funds may charge slightly less overall for customers paying this way, although this isn’t always the case – check with your insurer to find out.
Do you need those “extras”?
Many of the policies you come across when you compare private health insurance will include optional extras that are of a lower priority to you, and you may find cheaper cover if you asses these extras and exclude any that don’t interest you. For example, you may choose to remove joint replacement extras if you’re young and don’t feel that they will benefit you at this stage in your life. Before you make any hasty decisions though, it’s good to talk things through with your doctor to check that you’re not dropping anything that you may actually need.
Use participating providers
Find out if your health fund has agreements with specific medical practitioners, dentists or opticians that can save you money and reduce the potential for out-of-pocket expenses. If you need to go into hospital, but use one that isn’t part of the participating provider network of your health fund, you may not be covered for your stay and treatment and this can be costly. Check whether your health fund has a network of treatment agreements in place and where possible, stick to using one of the participating providers so that you can be sure of being covered.
If your long-term health is something you feel concerned about protecting, you may decide to take out private health insurance no matter what your budget. However, many people pay over the odds for their private health insurance premiums, often because they don’t realise that there are ways to be more frugal without leaving yourself short of health insurance coverage. Try some of these tips and you may find a policy with lower premiums and a reduced probability of incurring out-of-pocket expenses.
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Category: Health
