As discussed in Wednesday’s post, our home budget has been a real focus for me as we kick off this new year and I shared a few of the tips and tricks I’m currently using to keep better track of our finances. For us, health insurance was one thing we couldn’t cut back completely given J’s therapy needs, but I really believe in trying to get the best bang for your health insurance buck – so the nice folks at Health Insurance Comparison have penned this guest post on ways you can save money on your health insurance costs. Belinda xx
If you’re looking to cut back on your outgoings, you may be wondering what kind of health insurance you can get for your money. While it’s true that you won’t be able to afford top level health insurance on a budget, there are ways to make your cover go as far as possible.
Buy As Soon As You Can Afford To
The Australian Government’s Lifetime Health Cover (LHC) initiative means that when you buy private hospital cover affects the amount that you’ll pay for it. For every year that you delayed beyond the age of 30, a 2 per cent loading fee is added to your premiums. Waiting until you are 4o will mean that you ultimately pay 20 per cent more for your health insurance compared to someone who bought their cover before the age of 30.
Review Your Cover Regularly
As your family’s situation changes, your health insurance needs will also be affected. This can be a good time to downgrade your policy to get rid of services that are no longer important but you may also need to look at upgrading your cover to avoid out-of-pocket costs for hospital and/or Extras services that are now needed.
At a bare minimum, you should assess your policy at least once per year to check that it’s still covering the most appropriate services for your needs. Where possible, it pays to try to second guess which services your family may need in the coming year to avoid being caught out by waiting periods. Major Dental and Orthodontics are two areas of Extras cover that typically have a 12-month waiting period, for example.
Downgrade Your Cover
If you’ve already got health insurance, you may be paying for services that you don’t need. This is often the case with top level health insurance policies, which may have been bought for obstetrics. Once you’re at the stage whereby you no longer require obstetrics services, you may be able to switch to a lesser level of cover without compromising on the services that you do need.
Top level cover will also include a range of age-related services such as joint replacement surgery, cardiac services and cataract surgery; all of which become more likely as you get older. Downgrading to a mid or basic level policy that does not need include these services is another opportunity to save on your premiums without affecting your cover.
Pay By Direct Debit
Some health funds will offer a slight discount on your premiums if you agree to pay them by Direct Debit. This is typically around the 4 per cent mark.
Is Budget Health Insurance Worth It?
Even if you’re not particularly bothered about having hospital cover to skip the queues, the financial benefits may appeal. An eligible hospital policy will exempt you from paying the Medicare Levy Surcharge, if your household income means that you will otherwise have to pay it. An ‘eligible’ hospital policy is one that has an excess of $500 or less for singles and $1000 or less for couples and families.
Bear in mind that Medicare does not cover many out-of-hospital services, including dental and optical (except for eye tests performed by qualified optical specialists), many forms of therapy and emergency ambulance (in some states). Some degree of Extras cover is therefore advisable to avoid out-of-pocket costs if your family needs to access services that are not available through Medicare. Basic Extras policies will have relatively low annual limits for services, which can lead to out-of-pocket costs if you go beyond them.
At HealthInsuranceComparison.com.au, we’re all about helping you to understand health insurance so that you can find the best cover for your needs and budget. Whether you’re just trying to get a feel for the type of policies that are out there or you’ve already got a good idea of what you want, we’ll help you to get the best value for money.