Private Health changes: Premiums up, cover overhauled

Major changes to private health insurance come into effect from today with premiums to rise and hospital cover overhauled.

From today, premiums will increase by an average of 3.25 per cent, which will add $135 a year for the average family policy and $62 a year for the average single policy.

While the increase is above CPI and more than wages growth, it’s less than premium hikes in previous years.


Australians aged 18-39 will now be offered discounts of up to 10% on their hospital cover, depending on when they first purchase their policy.

The discount will apply until the policy holder turns 41, when it will phase out by 2 per cent per year.

Health insurers will also be able to offer a higher excess in return for lower premiums.

Singles will now be able to choose and excess up to $750, up from $500, while couple and families can opt for an excess of up to $1000

But the biggest change is the overhaul of hospital cover with the introduction of Gold, Silver, Bronze and Basic tiers of cover.

The new classification system is designed to allow people to see exactly what’s covered and to find the right policy.

Natural therapies will no loner be covered, including aromatherapy, naturopathy, Pilates, reflexology, shiatsu, Tai chi, and yoga.

It’s hoped the removal of natural therapies will help limit premium increases in the future.

People living in rural and regional areas will get extra support with health insurers now able to offer travel and accommodation as part of their policy.