Health premium 4 per cent price hike to cost families

PRIVATE health insurance premiums are set to rise from April, with families being among those most affected most by the move.

PRIVATE health insurance premiums will rise by close to four per cent from April, costing families about an extra $140 a year.

Federal Health Minister Greg Hunt has ticked off on an average 3.95 per cent increase and says it's the lowest government approved hike since 2001. Last year’s average premium rise was 4.84 per cent.

“We know that every dollar matters to Australian families and although this is the lowest increase in 17 years, there is more work to be done,” he said on Thursday.

On the government’s measure, consumers at looking at paying around $73 a year extra for singles and $140 for families.

The comparatively lower annual increase follows government reforms to the price health funds pay for hip and knee replacements and other prostheses, as well as changes to simplify policies into gold, silver, bronze and basic.

The price hike will cost families an extra $140 a year and extra $73 for individuals. Picture: iStock

From April 1, Medibank and its subsidiary ahm will up premiums by an average of 3.88 per cent.

Chief executive Craig Drummond said private health costs had increased by about five per cent over the past year.

“These cost increases are largely being driven by medical inflation and an increase in the frequency of people seeking treatment,” he said.

“I am committed to maintaining pressure at all levels to keep these increases in check.”

BUPA is looking at a 3.99 per cent rise, with managing director Dwayne Crombie arguing broader health reforms are needed to bring down the cost of health care.

“New services and technology mean that people are living longer and having a higher quality of life, which is what we all want, but it does come at a cost,” Dr Crombie said.

Despite the yearly increases, the federal government has been keen to urge young Australians to take up private health insurance.

In October it announced plans to allow insurers to discount premiums for 18 to 29 years old by up to 10 per cent.

Medibank will raise premiums by an average 3.88 per cent and nib by 3.93 per cent. Premiums at nib’s GU Health subsidiary will increase by 2.84 per cent.