Health fund premiums to rise 11.4 per cent

Health funds profits surged 204 per cent to $1.5 billion in the year to December but despite this premiums will still rise by up to 11.4 per cent at some health funds.

One major health fund is raising the premiums of its Gold cover by a massive 11.4 per cent, which is more than three times the inflation rate and more than four times the industry “average”.

Health fund HBF which cancelled its premium rise entirely in 2020 will increase premiums on its Gold Hospital with Flexi 60 extras products by almost $400 a year for singles and by up to $793 a year for families on April 1.

It is also the only major health fund not to delay the implementation of its annual premium rise beyond April 1 this year.

The price rise yet again exposes the ruse of the government’s so called “average” 2.7 per cent premium rise figure said to be the lowest since 2001.

A News Corp investigation in 2020 uncovered that the “average” premium rise figure used by the government and health funds is not a true average of the premium rises imposed on fund members.

Instead, is merely reflects the average percentage rise in premium income health funds receive.

The nation’s two biggest health funds – Medibank and Bupa will raise their premiums above the national average – Medibank by an average of 3.1 per cent and Bupa by 3.18 per cent.

And we can reveal some of the products offered by Medibank will rise in price by 7 per cent later this year, while others won’t increase at all.

Health fund premiums are rising. Picture: iStock

Health funds last year made a massive $1.5 billion profit (an increase of 204 per cent) due to Covid surgery bans which prevented their members from using their cover to pay for elective surgery, dental and other care.

Normally premium rises take effect on April 1 but four of the major funds have deferred their premium rises until later in the year as they seek to return some of these Covid profits to their members.

Nib will not impose its premium rise until September 1, Medibank and BUPA will delay their until October 1 and HCF will hold off until November 1.

After years of decline health fund membership is on the rise again as wait times for surgery in public hospitals hit record levels.

A survey by health fund comparison service iSelect found almost one in four (24 per cent) of fund members believed private health insurance has become more valuable as a result of the Covid-19 pandemic.

One in five Aussies indicated that they had been affected by delays in elective surgeries within the past two years, 14 per cent within the public system and 8 per cent within the private system.

“Now is a good time for health fund members to get themselves up to speed and review their policy to ensure it still suits their needs and budget.” iSelect spokeswoman Sophie Ryan said.

Medibank said its premiums will rise by an average 3.10 per cent but some policies will not rise in price at all while the highest increase will be 7 per cent.

Harris Schneiderman, from Melbourne, with Gabrielle Goldberg and their daughter Eloise Goldberg. The family have saved from shopping around for private health insurance.

Nib members who have Gold hospital policies are facing rises of 6.77 to 6.81 per cent, Silver Plus policies will rise by between 3.59 and 3.61 per cent, BronzePlus policies by 0.41 per cent to 2.9 per cent depending on which state a person lives in.

BUPA said it was unable to provide a detailed breakdown on its policy rises because “generally every customer’s product combination is different”.

HCF said its rise wasn’t until November and it would “let our members know about a month before the rise what their individual increases will be”.

HBF said across the board its premiums are rising by an average of 3.62 per cent.

Eighty per cent of the funds members live in Western Australia which did not experience the same savings from Covid lockdowns and surgery bans as funds based in the eastern states, and that was why it was unable to defer premium rises this year, HBF Chief Executive Officer John Van Der Wielen said.

One Melbourne family demonstrated the value of shopping around for health insurance saving over $1200 off their annual health fund premium.

“I did my own research online with some of the providers and I also went to iSelect and I ultimately chose to move to Latrobe Health,” IT worker Harris Schneiderman said.

“It was 100 bucks cheaper than what I was paying before even before the increase and at least as good if not better cover,” he said.

The deal he obtained using iSelect was cheaper than ordinary members of the public could obtain by going direct to the same health fund because it had negotiated a better rate for the same level of cover, he said.

AVERAGE HEALTH FUND PREMIUMS INCREASES 2022

ACA Health Benefits Fund Limited 2.59%

AIA Health Insurance 2.80%

Australian Unity Health Limited 2.73%

BUPA HI Pty Ltd 3.18%

CBHS Corporate Health Pty Ltd 5.33%

CBHS Health Fund Limited 2.91%

Cessnock District Health Benefits Fund Limited 3.77%

CUA Health Limited 3.42%

Defence Health Limited 3.33%

Doctors’ Health Fund Pty Ltd 2.28%

GMHBA Limited 3.10%

HBF Health Limited 3.62%

Health Care Insurance Ltd 1.09%

Health Insurance Fund of Australia Limited 3.20%

Health Partners Limited 3.15%

health.com.au Pty Ltd N/A

Hospitals Contribution Fund of Australia Ltd 2.72%

Latrobe Health Services Limited 3.41%

Medibank Private Limited 3.10%

Mildura District Hospital Fund Ltd 2.90%

National Health Benefits Australia Pty Ltd 3.24%

Navy Health Ltd 3.25%

NIB Health Funds Ltd 2.66%

Nurses & Midwives Health Pty Ltd N/A

Peoplecare Health Limited 3.27%

Phoenix Health Fund Limited 3.16%

Police Health Limited 1.79%

Queensland Country Health Fund Ltd 3.34%

Queensland Teachers’ Union Health Fund Limited 2.26%

Railway & Transport Health Fund Ltd N/A

Reserve Bank Health Society Ltd 3.74%

St Luke’s Medical and Hospital Benefits Association 3.19%

Teachers Federation Health Ltd 2.17%

Transport Health Pty Ltd 1.16%

Westfund Limited 2.40%

Industry Average 2.70%

Source: Private Health.gov.au