Nicole helps??? beat the April health insurance price rise

Dear Nicole,

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I have a question about health insurance. My family (with two kids aged 10 and seven) is on top hospital and extras with HCF, but I was recently emailed a letter saying it’s going up from $390.90 to $406.85 a month from April 1. It says this includes a rebate of $142.55. Somehow hitting the $400 mark is making this hard to swallow. How can I cut this cost? Should I drop our cover? Thanks.

Marina, Wollongong

Most people will be asking themselves the same questions, Marina, as the annual price rise rolls around. The problem is we’re an ageing population, that’s costing ever more to keep healthy.

This increase hasn’t been applied willy nilly though – funds need to get approval all the way from the top, from the federal health minister. Your increase, at 4 per cent, is also smaller than the average, which is 4.8 per cent and the highest, 8.5 per cent. (And I applaud the health industry’s regulation and disclosure of before and after premiums; this should be mandated for other insurance types.)

Note too that HCF, Australia’s largest not-for-profit health insurer, in the past five years has paid out more of its premiums versus the average as benefits to members.

But private health insurance is expensive. There are cheaper options available – you can compare on the comprehensive (and independent) privatehealth.gov苏州美甲学校论坛, which will show new prices from April 1. Note that portability rules mean, if you already have cover for a particular condition, you don’t have to re-serve waiting periods.

However, I refer you to my comment about HCF above; with insurance especially, cheaper isn’t always better. The best idea is probably to optimise your premium.

Firstly, are you paying for hospital cover you won’t likely need at your age? Think maybe hip replacements, cataracts and dialysis, bearing in mind this ups your risk.

Safer might be dropping obstetrics, which iSelect says typically saves $500 a year, if your family is complete at four. Be sure!

You could also look at reducing your premiums by increasing your per-hospital-stay excess or adding a per-night-in-hospital co-payment, say $50. Check this still exempts you from the Medicare Levy Surcharge, if your household income is above about $180,000.

Having examined the HCF extras, don’t miss out on the generous $200 each a year you can claim for your kids’ (I assume they take them) swimming lessons. That’s one month of premiums covered right there.

Should you drop cover entirely? This is really your call, but I wouldn’t. Many an insurance actuary over the years has pointed out to me that, even in Australia, the cost of treating some conditions can reach six figures. And there is a possibility the stretched public system wouldn’t get to you in time.

Nicole Pedersen-McKinnon is a money educator and consumer advocate: themoneymentorway苏州美甲学校. You can write to her for help solving your money problem, or with a consumer question, at [email protected]苏州美甲学校苏州美甲学校论坛.