Private Health Insurance
Levels of private health insurance membership vary by age group quite considerably, but the biggest adherents are still individuals and couples aged over 55, as illustrated in the chart below.
Why private health insurance is maintained despite the (increasing) cost predominantly comes down to the following factors in order of importance:
- Security/protection/peace of mind
- Allows treatment as a private patient in hospital
- Choice of doctor
- Shorter wait for treatment/concern over public hospital waiting lists
- Provide benefits for ancillary services/"extras"
Conversely the single major reason why private cover is not maintained is fundamentally economic - "Can't afford it/too expensive".
Our view is that the great majority of self funded retirees will choose to have private health insurance, principally for "peace of mind" and in that context the focus should be upon ensuring that cover represents "value" and that any costs outside insurance ("gaps") are managed as effectively as possible.
Comparing Health Insurance Policies
There are now a number of websites that allow you to compare policies and costs online, including PrivateHealth.gov.au. There are also a number of other private-sector sites which provide the same functionality, but they will often not include all available health funds, and the results may be skewed towards certain providers. They will also often not provide details without you providing a contact point - a telephone number or email address - and we recommend that these services are avoided. Choice is a very good resource within which to review available funds, but it does cost either a quarterly or annual membership fee.
Note that it is very worthwhile giving consideration to precisely what cover you require - for example, you will "probably" not need prenatal and maternity cover or IVF cover, and many policies now cover a range of alternative therapies and extras which you may not want, need or value.
In any event, a clear focus should be upon ensuring that you limit your exposure to medical gaps as much as possible, and that includes utilising the public system where appropriate. We separately consider the issue of gaps and medical costs in more detail.