Health Insurance Is Easy To Understand If You Ignore All The Marketing Spiels
Ben Thomas,
Customer Experience Manager
Health Insurance Expert, who’d sign up for that job title? Ben Thomas did in 2008 and hasn’t looked back.

Think cover first, health insurer second. Tips on figuring out what’s important to you before you pick a fund

 

Why 50% of Australians take out health insurance
All Australians have access to the public system at no additional cost. All taxpayers pay a Medicare Levy that funds it for everyone. So why pay for health insurance as well?

Health insurance provides you with more choice and control when it comes to your healthcare, and it may provide tax benefits. But it can also be expensive so it’s important to understand what you need before you sign on the dotted line.

There are only two types of cover you need to think about
1. Hospital cover
2. Extras cover

Each type pays benefits for different types of treatment. Most people take out combined hospital and extras cover, but you can choose one or the other depending on your needs.

1. Hospital cover – pays benefits toward the cost of treatment in hospital. It gives you control over:
· WHO you’re treated by – some people prefer a surgeon recommended by their doctor
· WHERE you’re treated – access to a private hospital close to home and a more comfortable environment
· WHEN you’re treated – because waiting times are usually shorter in the private system

The level of hospital cover you choose determines the types of procedures you’re covered for (like pregnancy or heart surgery). The higher the level of cover, the more procedures you will be covered for.

When a procedure is “covered”, that means that 100% of the cost (minus any excess) of your hospital visit – if you’ve been admitted – is paid by your health fund.

2. Extras cover – reduces the cost of treatment for things that Medicare doesn’t cover. This includes non-GP services like general dental, major dental, optical, physio and more.

Extras is all about your lifestyle and it’s the area where you can save the most money and be confident that you’re paying for health insurance that you’ll actually use.

There are two different ways that health funds contribute to the costs of different services:
· as a percentage proportion of the fee charged by the provider (eg. 65% back from a dental consultation), or
· as a fixed dollar per visit (eg. $30 per Physio visit)

The most important thing you need to enquire about is the total annual limit your policy will contribute across different services. If you never use these types of services, then maybe extras cover isn’t a ‘must have’ for you.

Here’s a big tip: think cover first, health insurer second
While there are over 30 health insurers to choose from, think first about what you need from your cover before you get caught up in the different funds’ brand pitches and gimmicky giveaways.

Once you figure out whether you want hospital or extras cover, or a combination of both, you can then think about which health insurer will give you the best peace of mind and best value.

There are two types of health insurance providers you need to be aware of:

1. Not-for-profit health insurers – while there are already over 1 million Australians who have their health insurance with not-for-profits, these funds are kind of the unsung heroes of health insurance. To cut a long story short, not-for-profits exist to return profit margins back to benefiting their members

2. For-profits – who answer to investors or overseas owners. Enough said. The big, familiar ‘for-profits’ are Medibank, BUPA, iSelect, Compare the Market, nib and AHM. Their advertising completely dominates our TV screens but that doesn’t mean that they’ll offer you the best value coverage

The not-for-profits give their members more than the big for-profits, so it’s kind of a no-brainer
It’s a fact that the Members Own health funds are a collective of not-for-profits and mutual that provide superior value through better coverage and more benefits, which is why they have happier members.

Now, here’s one of the best kept secrets in health insurance
There are also not-for-profit funds connected to specific industries that millions of people qualify for but many Australians don’t realise they are eligible to join them.

This is a big deal because some of these funds (also known as ‘Restricted’ funds) can provide the best value. You can find out more about these health funds through the Members Own Health Funds comparison service.

Finally, don’t underestimate how much time and money you’ll save by speaking to a real person that works for a company that is more concerned with your needs than just making a quick sale and a profit

The Members Own online comparison service is a brilliant way of identifying the top policies for your needs, and you can finish off the process by talking to one of their independent not-for-profit health insurance experts.

They can ensure that you’re going to be able to benefit immediately from your health insurance by exploring your waiting period options and taking the time to properly explain the tax benefits you’ll receive.

You can use our online comparison service to do most of the work for you, or give us a call on 1300 34 34 36, and we’ll find the best health cover for you from our panel of not-for-profit and mutual health funds.