How much has your health insurance been hiked?

Happy Easter to me – I now pay an extra $14 per month for health insurance! If you have health insurance, you too have experienced a premium hike.

In the strangest of decisions, the health insurance industry hikes its premiums every year on April 1st. I don’t know which big-wig thought it would be a smart idea to habitually increase prices on April Fools Day – surely March 31 would be a better play? But I digress…

April 1 happened to fall on Easter Sunday this year, which was also the last day of daylight savings (this past Sunday was nothing if not significant!). As of that date, my health insurance premium increased $14 per month, which is actually not bad compared to previous years; last year it jumped $42 per month, prompting me to move to a new insurer and cut my coverage substantially.


The average premium increase this year was around 4%, reports ABC News, and will cost Australians an extra $200 per year – which equates to roughly $1 billion in extra income for private health insurers.

Obviously, customers are never pleased to wear a cost hike. But it’s the sheer confusion and convoluted nature of paying for private health insurance that really gets my goat.

You get a discount for PHI if you’re under 30, and get slapped with an extra charge if you’re over 30. You can get a rebate from the government tied to your income level – it used to be a flat 30%, but it’s now anywhere from 7-26% – and if you earn above a certain amount and don’t have PHI, you’ll pay an extra Medicare Levy.

In the midst of navigating all of this, policies are deliberately confusing and appear as if they’re designed to minimise your claims.

I remember a few years back, my health insurer reduced my policy’s remedial massage benefit from $500 annually to $100, as they were paying too many massage claims. More recently, BUPA has copped flack for removing dozens of benefits, including pregnancy and IVF, from a fair chunk of their policies.

These kinds of moves flood the market with cheap “junk” policies, which are designed to appeal to young customers, says Jennifer Doggett, a fellow for the Centre for Policy Development.

“What’s in the product is irrelevant [to younger customers]. That shows how ridiculous the situation is,” she says. “The government is subsidising a product that people are buying to avoid tax. It’s obviously an incredibly inefficient way to fund healthcare.”

Ridiculous indeed.