What are the most common health insurance claims?

Many Australians may dread the dentist chair and the sound of that mechanical drill, but according to recent statistics, work on our pearly whites makes up the majority of health insurance extras claims.

According to the Australian Prudential Regulation Authority (APRA), health insurers paid about $1.3 billion in benefits for extras treatment – also known as ancillary or general treatment – in the June quarter.

Dental accounted for $692 million of benefits paid, followed by optical ($202 million), physiotherapy ($114 million) and chiropractic ($77 million).

The APRA report said $221 was paid for dental treatments for each insured person.

General dental is the most popular inclusion visitors search for on Canstar’s health insurance comparison site.

In the past three months, more than 8,500 users searched for general dental, followed by optical (almost 7,000 users) and physiotherapy (about 5,500 users), while dental crowns and bridges were the most searched for extras when it came to major dental care (5,065 users).

General dental covers common procedures such as teeth cleanings, check-ups and small fillings, while major dental encompasses complex and expensive procedures such as wisdom teeth removal, root canals and braces.

When it came to hospital treatment, insurers paid $3.9 billion in benefits with accommodation and nursing being among the most common claims, APRA’s figures showed.

Australia’s health insurers collected almost $24 billion in premiums in the 12 months to June 30, up about 3.6% from a year ago.

At the same time, they paid $20.3 billion in benefits, up 3.4% on the prior year.

So, with constant change within the industry, including premium price hikes and coverage, what makes a good health insurance policy in 2018?

2018 Health Insurance Awards

After analysing 3,080 hospital policies, 2,082 extras policies and 10,918 combinations of hospital and extras package policies, Canstar has announced the winners of the 2018 Health Insurance Awards.

The Health Insurance Awards and Star Ratings involve a sophisticated methodology, assessing 476 consumer profiles to identify excellence among the health insurance providers.

Canstar Research Analyst Josh Sale said consumers’ needs differ for a variety of reasons, such as life stage and family structure, which means certain policies provide more appropriate levels of cover and more relevant features for certain consumers than others.

Mr Sale said policies could differ from state to state in regards to what they offer and their availability.

As a result, national award winners must provide a broad range of policies offering outstanding value across different states.

“Canstar’s National Health Insurance Award uses the cumulative performance in each of the state-based awards and recognises the funds that provide consistent outstanding value to a wide range of consumers from all around the country,” Mr Sale said.

For the third consecutive year, HCF, Medibank and Bupa have received Canstar’s National Outstanding Value Health Insurance Award for 2018.

Medibank and Bupa have won this award each year since the Health Insurance Star Ratings’ inauguration 11 years ago.

The national and state winners are listed in alphabetical order below.

Bupa

As with other national award winners, Bupa performed consistently across all states and territories.

Canstar Research said Bupa’s Basic Hospital cover – generally aimed at young people and families looking for affordable cover – was a standout because it provided cover for many common procedures and accidental injuries and had different excess options to potentially help keep premiums down.

Canstar Research also found Bupa’s top hospital cover performed well, giving policy holders extensive coverage with competitive premiums that were well below the market average in all states.

Bupa offers policies that have consistently ranked in the top 10% for hospital and hospital and extras package profiles.

HCF

HCF provides a broad range of policies, which Canstar Research assessed as offering outstanding value to consumers in different states.

Canstar Research identified the Mid Hospital cover with a $250 excess packaged with Silver Plus extras as HCF’s standout product for singles, couples and families looking for hospital and extras cover.

Mr Sale said the policy provided more than just the basics but premiums were about 25% below the market average for a hospital and extras package.

“It was more affordable than 80% of the policies Canstar considered in package profiles,” Mr Sale said.

“Policyholders also receive cover for items such as cardiac, joint reconstruction, colonoscopy and a range of other procedures not covered by more basic policies.”

Consumers looking for more comprehensive cover such as pregnancy, or those in mature age brackets could consider a more extensive hospital cover, where HCF has also excelled.

HCF’s Premium Hospital (with $500 excess) cover was a top performer in pregnancy and mature age profiles and performed well in package profiles when bundled with an extras policy.

Canstar Research also said year-on-year premium increases vary from policy to policy, however, HCF for the third-year running had premium increases below the industry average.

Medibank

Canstar Research found Medibank performed well in all profiles, striking a balance between affordable basic policies and the availability of more comprehensive cover for those requiring it.

Medibank’s Hospital Essentials and Core Hospital policies performed particularly well in younger profiles, where affordable premiums are often a key component.

“These policies, while not as comprehensive in terms of coverage, could give consumers the peace of mind that they have basic hospital cover with premiums that fit within their budget,” Mr Sale said.

When it comes to top cover, Medibank’s Complete Hospital policy retained its strong position within the market while maintaining competitive premiums, according to Canstar Research.

Medibank’s range of extras policies was also found to provide consumers with outstanding value, with both Basic and Top extras options among the top performers in those categories.

If you’re in the market for a new Hospital & Extras policy, the table below displays snapshot of policies on Canstar’s database of Canstar’s National Award winners for 2018. The policies shown are based on a single male, aged under 35 living in NSW. Please note that the results are sorted by Star Ratings then by provider name (alphabetically).

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State award winner HIF

While HIF did not win a national award, Canstar Research was particularly impressed by its hospital cover, which continued to win state awards in each of the states that it is eligible.

It outperformed the larger funds for hospital cover in Western Australia, Queensland and Victoria.

HIF is also available in other states like NSW, where its market share is continuing to grow.

HIF’s Gold Hospital policy was found to be priced significantly below other top hospital policies and provided private room at a private hospital for up to five days for maternity stays and shared room cover for other procedures.

For pregnancy cover and mature age profiles, this hospital policy came out on top when the $400/$800 excess option was selected and all three excess options ranked in the top 10 policies available in all states where the policy was offered.

State winners are:

View Methodology