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Each year on 1 April, private health insurance premiums rise. It’s a necessary increase which takes account of the rising cost of medical care as well as demographic factors such as an aging population. Nevertheless it can hit the hip pocket hard! So what do the average premium increases this year mean for your bank balance? As an indication, the average state-by-state increase for a family package policy is outlined below:
| State | Package cost from 1 April 2014 | Is an increase of: |
| Northern Territory | $4,015 | $249 |
| South Australia | $5,126 | $318 |
| Western Australia | $5,154 | $319 |
| New South Wales | $5,154 | $319 |
| Tasmania | $5,233 | $324 |
| Queensland | $5,391 | $334 |
| Victoria | $5,439 | $337 |
Source: Canstar. Premiums based on comprehensive package family cover 2013 state averages on Canstar database. Does not take into account rebate.
Individual state costs are driven by a number of factors, including the number of private hospitals in each state – obviously the greater the access to private hospitals, the greater the likely usage by the public. So in the Northern Territory, for example, there are not many private hospitals; this partially drives lower average state premiums. As well as access to private hospitals, there is also consumer use in each state, including the type and cost of procedures performed.
The majority of households will receive a government rebate on the above premiums, with many families receiving a 30% rebate. Interestingly and somewhat sneakily, the way that the government calculates that rebate is changing this year. Find out how your private health insurance rebate is about to change.
How can households save money on the cost of private health insurance premiums? We’re created some tips on how to shop around for health insurance. Overall though, the key to saving is to get good value for money via a policy that suits your specific needs. That’s easier said than done of course, but Canstar can help. Our most recent Star Ratings Report assesses 943 health insurance products across three different coverage sectors – hospital, extras and packages – to determine which ones offer outstanding value across eleven different life stages. Why not check out our comparison report https://www.canstar.com.au/health-insurance/star-ratings-health-insurance/ and see if you could save some money?
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