The private health insurance industry in Australia is growing fast and becoming more competitive than ever before. According to a recent market report from IBIS, the revenue of Australia’s health insurance industry was estimated to have grown at an annualized 6% rate over the past five years, reaching a total of $26.1 billion in 2018. This growth is largely due to steady a climb in revenues from both the premium and private health insurance sectors.
Australians searching for a private health care insurance provider are getting hit with the reality that many of them charge more than what was expected. This puts many of these individuals at a disadvantage, especially because some people are financially strapped. The following are 4 smart moves to get better and more affordable insurance to rest easy in the healthcare industry.
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Personalized Insurance
Private insurance companies are attempting to make that penalty even higher than it is, which is troubling.
At the moment, a single Australian person who makes more than $90,000 or families over the $180,000 threshold pay a small levy if they do not get health insurance.
Private health insurance companies believe that the levy should be increased. The current range is between 1 percent to 1.5 percent to a range between 1.5 percent to 2.0 percent. Private health insurance companies believe that this increase will make it harder for hard-working Australians to ignore the levy and actually buy insurance.
Reconsider Insurance
There is another option, which is by joining a member-owned insurance company that shares its profits with members instead.
Non-profit member-owned health insurance companies offer many benefits. For example, members get to skip the income tax assessment. This was a right given to Australians who join this type of organization under the Income Tax Assessment Act, which was enacted back in 1997. This is a perk that members of profit-driven health insurance will not be able to enjoy.
You should also pay attention to how profits are distributed amongst these two types of insurance companies. In a recent fiscal year, the profit funds between the two types of insurance companies were compared. Member-owned insurance companies returned 86.8 percent to their members in the form of benefits, like lower premiums whereas private companies only returned 84.6 percent.
It is easy to dismiss such a small percentage point difference, but dismissing this small percentage difference becomes harder when you pay attention to the dollar amount it represents. That little difference some may dismiss actually equals to $375 million, which means more in perks for the members. These are families just like you who are happy to join an organization that is looking out for them.
Higher Co-Payment
This is a bit of a risk but is one worth considering. Insurance premiums are severely cut when the purchaser decides to pay a higher co-payment should he or she be admitted to the hospital for any reason.
Of course, this does mean that the individual needs to practice wise savings to ensure that co-payments will not be a problem later. This risk is better suited for a younger person who may be healthy and does not go to the hospital as often.
An older individual may go to the hospital more often, meaning that he or she may end up paying a lot more in co-payments. Those considering taking the risk need to consider age and overall health before taking the leap.
Younger Advantage in the Health Insurance Industry
One way to save money on health insurance is reserved for those who are 30 or younger. Insurance companies offer what is sometimes called the Lifetime Health Cover to younger customers.
Those who are smart enough to buy into this insurance coverage are going to be buying at a base premium. Those who are 31 or older will end up paying two percent more for each year that passes. That two percent may not seem like much, but it does add up, meaning getting this before turning 31 is a smart decision.
The problem is that many younger people do not see the value in getting this kind of insurance because they feel healthy and hardly got to the hospital, but it pays to think about the future.
Saving money on health insurance costs is something that everyone should consider, even those who feel they are well off. It may be time-consuming to look over the policies offered to an individual or to compare companies, but any money saved can go to some other expense that could improve the quality of life. Taking time to save on private health insurance costs is definitely doable and wise.
More related to health insurance industry
- Top 10 Healthcare Industry Challenges and Solutions for 2018
- Healthcare Market in China: Fastest Growth Rate in the World
- 5 Things That Will Happen if America’s Affordable Care Act is Repealed
