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How To Save On Your Health Insurance

written by Shelley Marsh 24/07/2014
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Last week I spent some time trying to figure out whether we had the best deal on our private health insurance.  You see, we have been with the same insurer for 10 or so years and they have been great, but recently I have begun to wonder whether our health insurance might be a place where we could save some cash.  The truth is this process wasn’t easy.  In fact I can safely say that a couple of hours in and the whole ‘health insurance’ scene was doing my head in!!!  However, in amongst the talk of excesses, hospital choices, government rebates, blah blah  I did figure out quite a few things.  So here they are to help you make your health insurance journey far more pleasant than mine J

(1)   Figure Out What Cover You Have Now And How Much You Pay For It

This is the best place to start, you can’t compare something unless you know what you have already.  So I looked at what type of hospital cover we have, noting what was covered and what is not.  I looked closely at our extras cover and what was included.  Then I found out how much our excess was.  This is how much we would have to pay if we had a hospital stay.  Once you have had a hospital stay and paid the excess you don’t have to pay it for subsequent visits in that calendar year (for my health company).   The last thing you need to know is how much you are paying, and whether that includes the government rebate.  (To figure out whether you qualify for the rebate and how you can have it paid click here).

(2)   Figure Out What Features Are Important To You

On the hospital cover ask yourself a stack of questions about what you need.  For example are you thinking of having a child/more children/IVF?  What family history do you have that might need to be covered for?  Do you need extras?  In our case when we decided our family was done we downgraded from what I call ‘baby coverage’ and this saved us a stack of dosh.  If you only take one thing from this post make sure you check your level of cover is appropriate, as it can give you big savings.  In term of extras the most important features I decided for us were optical and dental.  Yes, both the hubby and I are ‘four eyes’ and let’s just say the hubster spends a fair bit of time at the dentist.  The rest we use marginally so if one has better physio than another I decided that it shouldn’t really sway me.  Choosing two services to focus on really helped as it narrowed my focus down.

(3)   How Much Excess Can You Afford To Pay

The way it works is the higher your excess the lower the cost of health insurance.  However, having a high excess is useless if you can’t afford to pay it when you need to access the services.  So choose an excess that is manageable for you.  We went for a high excess as we have the cash in an emergency fund to pay for it if we needed it.

(4)   Find Out If You Have A Loading Under Life Time Health Cover

If you take out hospital cover as part of your health insurance after your 30th birthday you will you will pay a 2% loading on top of your premium for every year you are aged over 30.  The loading lasts for 10 years.  My husband didn’t start cover until he was 32 so he has a 4% loading until he is 42.  To find out more about the loading click here.

(5)   Start Comparing Health Insurance Policies

Ok, this is the tricky bit as it is hard to know what is out there.  Remember to keep the focus on the features that are most important to you.  I started by using a government site (click here) and seeing what policies they suggested.  Next I used a commercial comparison site.  These are good for finding out what is out there, but a word of warning be prepared to be harassed!!  I put in my details and an hour later they were calling.  When I ignored it they called again and again.  When I finally spoke to the guy he was helpful but I did feel pressured to make a decision so I cracked out the old “I will have to talk to my husband” so I could have time to think.  At the end of the daykeep in mind that they are trying to sell you something, so don’t be rushed into a decision.  Also each comparison site does not have access to every health fund so it might not necessarily give you the best deal.  That said, my guy was really helpful and even told me that my current provider gave me the best optical extras.  So comparison sites can certainly be helpful and definitely helped me on my journey to figure this out.

So what happened in the end?  After much contemplation and hair pulling-out we have decided to stick to our current health fund.  However, if you ever choose to change it is pretty easy and you don’t have to re-serve waiting periods as long as you are moving to the same level of cover or lower.  So it is always worth checking if you can get a better deal!  🙂

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The information contained in this post is general in nature and does not constitute financial advice.  Please see your financial advisor for advice specific to your individual circumstances.


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Lydia C. Lee 25/07/2014 at 6:34 am

I would also add, make sure you work out how they pay for each item, before you get the bill. I discovered, having been burnt before, that if I pay for braces in full, I get $700 back. If I stretched it out over 3 years, I’ll get $1800 back. Same price I pay, different return.

Shelley Marsh 25/07/2014 at 6:52 am

That is such a good tip Lydia!!! I will definitely be keeping that in mind next time we are facing a big bill! Thanks so much for stopping by.

Grace 25/07/2014 at 2:00 pm

We moved health insurance policies about 2 years ago. I think it’s important to check once in awhile what’s out there in the market. Lydia’s tip on stretching out payments…wow! I never would’ve thought of that!

Shelley Marsh 25/07/2014 at 3:33 pm

Hi Grace, yes I think it is an important one to check every now and then and yes I love Lydia’s tip too – one I will definitly be putting into action!

Amanda @ Cooker and a Looker 25/07/2014 at 4:27 pm

May I add, finding out whether your health fund cover is by calendar year or financial year, then splitting expensive treatments over the cusp? I recently needed some expensive dental work, but splitting it over the end of financial year meant I could claim my entitlement for both years.
Private health is an expensive but necessary evil. That said, I love to get my money’s worth!

Bec @ Seeing the Lighter Side of Parenting 26/07/2014 at 1:15 pm

We reevaluate every couple of years. I’ve only ever moved once, but it was definitely easy to do and we even got offered sign on bonuses:)

Emily @ Have A Laugh On Me 26/07/2014 at 6:38 pm

We are sitting on the fence as to whether we bin it after 7 years…. I want to keep it , hubby not so much! 🙁

Alison Parks 28/07/2014 at 2:28 pm

We got health insurance for the first time this year and did a similar exercise to yourself – agree, what a nightmare!! Thanks for all the tips everyone … especially the one about spreading out payments, gosh, that is one worth investigating further. Cheers, Al

Hope @NannyShecando 28/07/2014 at 10:25 pm

Great tips, it was such a nightmare for me when I first set up private health. And you’re absolutely right, figuring out what exactly you want to have covered, and benefit from is essential!

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Mums Take Five 30/07/2014 at 11:48 pm

I try to do this once a year… last year i went around in circles and ended up staying with the same people just changed my policy. was all too hard but still i pay less now than the year before. good advice love. Thanks for linking up for sunday brunch

Shelley Marsh 03/08/2014 at 9:20 pm

No worries Mums Take Five – you know I wouldn’t miss out on your Sunday Brunch link up!

Abby 19/08/2014 at 10:58 am

Hi All

I also learnt (by a happy mistake) that my cover was for a calander year – So by Dec 2012 I reached my benefit limit for dental work – I still needed to have 2 more fillings – I went in Feb 2013 and what do you know -full benefit was available – I called my provider, confused, and they said it resets on 1st January – so that was a great surprise.

Shelley Marsh 25/08/2014 at 7:25 am

Hi Abby – yes it is really important to know when your benefit resets – ours is a calendar year like you! So glad you got everything covered!

Abby 19/08/2014 at 11:07 am

Also a little tip – SOMETIMES it is better to split your hospital and extras cover and to be listed as a single not a couple. (No guy needs maternity extras yet they still sting you with the cost when your a ‘couple’)

My husband and i have individual cover and i have Hospital cover with one and extras with another – ended up saving about $45 a month = $540 a year – Its all down via direct debit so once it’s set up – you don’t even have to think about it.

Shelley Marsh 25/08/2014 at 7:23 am

Thanks Abby! What a great tip!! I would not have thought of doing it that way. Thanks for sharing!

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