A PREMIUM rise three times the inflation rate has unleashed consumer rage on health funds with more than half a million people planning to quit their cover.
Premiums will rise by around $200 a year for a family and around $100 a year for singles on April 1.
And almost half of all health fund members plan to shop around to find a better deal a Galaxy poll commissioned by health fund iSelect has found.
More than 530,000 Australians told the survey they planned to ditch their insurance altogether, a move that could increase pressure on public hospitals.
Families and couples who already have hospital only or extras only (as opposed to combined health cover) are the most likely to quit their health fund.
One in five or 215,000 couple and families with hospital only or extras only are considering dropping their cover, the survey found.
“It’s possible these households have already pared back their cover as premiums have risen in recent years but this latest increase may be the tipping point that means they can simply no longer afford it,” iSelect spokeswoman Laura Crowden said.
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Health Minister Sussan Ley has approved a 5.59 per cent premium rise that is more than three times the inflation rate.
Some health fund products are rising well in excess of this amount, Bupa’s Top Hospital with $250 excess is rising by 8.5 per cent and Medibank’s combined hospital and extras package for families by 9.5 per cent.
Seven per cent of health fund members will ditch their insurance, another 530,000 Australians will switch health funds, two million have decided to do nothing.
This could be because they are unaware they do not have to serve a new waiting period if they switch health funds.
Most Australians do not realise that any waiting periods already served will be protected by law if switching to an equivalent or lower level of hospital cover, Ms Crowden said.
“It’s worrying that only 46 per cent of policy holders correctly understand that waiting periods are protected,” she said.
“This could mean that many Australians are simply putting up with ongoing price increases instead of switching to a better deal with a different insurer because they wrongly believe they will have to re-serve waiting periods.”
In a bid to help health fund members choose a better insurer the AMA earlier this month released a guide showing how much different health funds paid for 22 of the most common hospital procedures.
The analysis showed if you need surgery some funds pay out $330 less for cataract surgery than the best fund, $737 less for a hip replacement, $794 less for delivering a baby.
Health fund HBF emerged as the fund with the highest benefit payouts for 9 of the 22 common procedures — cataract surgery, removal of tonsils, craniotomy, complicated and uncomplicated delivery of a baby, carpal tunnel release, hysterectomy, chemotherapy and sleep apnoea.
And 25 of the smaller players you may never have heard of including ACA Health benefits fund, Defence Health, Australian Health Unity and Frank Health Insurance, grouped under the AHSA brand, come in a close second.
They have the best payouts for knee replacements, coronary artery bypass, cataract surgery, coronary stents, skin cancer removal, hernias and haemorrhoidectomy and gall bladder surgery.
Mildura Health Fund and GMHBA provided the lowest benefits for 19 of the 22 procedures that were compared.
There was not a single procedure among the 22 surveyed where the nation’s largest health fund Medibank or NIB had the best payout.
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