Skip to content   Skip to footer navigation 

Bad health insurance deals: Medibank, Bupa, HCF, HBF, NIB

We name the poor-value health insurance policies from the big health funds.

health insurance companies logos
Last updated: 28 September 2020
Fact-checked

Fact-checked

Checked for accuracy by our qualified fact-checkers and verifiers. Find out more about fact-checking at CHOICE.

Need to know

  • Health insurance premiums will go up on 1 October so now's the time to review your cover
  • Eight out of ten health insurance members have a policy with one of the five largest funds: Medibank, Bupa, HCF, HBF and NIB
  • The big funds do have some good policies, but others are just bad value

There's no guarantee you're getting a good deal just because you're with a big, well-known health fund. And with health insurance premiums due to go up on 1 October, now is a good time to check you're on the best deal for your needs.

Five health funds dominate the Australian health insurance market. According to the Commonwealth Ombudsman's 2019 State of the Health Funds Report, about 80% of Australians with health insurance are insured with Medibank, Bupa, HCF, HBF or NIB.

The big funds all have a range of policies and while some of them are pretty good, some are really bad value for money.

CHOICE has reviewed thousands of policies from 36 health funds. We recommend you compare health insurance at least once a year to ensure you're getting the best deal.

Medibank

Medibank was launched by the Australian Government in 1976. Initially it was nonprofit but converted to a for-profit entity in 2009.

It was privatised in 2014 and is one of Australia's two largest health funds with 3.5 million members. It also owns the AHM Health Insurance brand.

Medibank's worst policies

Medibank Basic Accident and Ambulance

Low cover: Only covers you in the event of an accident and provides public hospital cover only for some services.

Bad value for money: In New South Wales, the ACT, Tasmania and Western Australia, this policy costs more than the cheapest bronze cover policy which covers you for essential services in private hospitals like breast and prostate cancer surgery, and treatment for strokes.

Medibank Silver Plus Security

Bad value for money: This policy has restricted or no cover for some services, including pregnancy and psychiatric treatment. But in all states, it's more expensive than the cheapest gold policy that fully covers all treatments.

Bupa

Founded in 1947, Bupa is one of Australia's two largest health funds with 3.6 million members. Bupa Australia is part of the international Bupa Group that provides healthcare services in more than 190 countries. Bupa is a for-profit company, but its parent company is nonprofit. 

Bupa's worst policies

Bupa Accident Only

Low cover: Only covers you in the event of an accident and provides public hospital cover for some services.

Bad value for money: In NSW, ACT, SA, Tasmania and WA, it costs more than the cheapest bronze cover policy which covers you for essential services in private hospitals like breast and prostate cancer surgery, and treatment for strokes. 

Bupa Silver Plus

Bad value for money: This policy does not cover some services including pregnancy. But in all states, except WA and the Northern Territory, it's more expensive than the cheapest gold policy that fully covers all treatments.

HCF

Established in 1932, HCF is Australia's largest nonprofit health fund with almost 1.6 million members

HCF's worst policies

HCF Accident Only Basic

Low cover: Only covers you in the event of an accident and provides public hospital cover for some services.

Bad value for money: In NSW, ACT and Tasmania, it costs more than the cheapest bronze cover policy which covers you for essential services in private hospitals like breast and prostate cancer surgery, and treatment for strokes.

HCF Hospital Silver Plus

Bad value for money: This policy has restricted or no cover for some services including pregnancy and psychiatric treatment. But in all states, it's more expensive than the cheapest gold policy that fully covers all treatments.

NIB

NIB provides health cover to more than a million Australians. It was established over 60 years ago and is a for-profit company.

NIB's worst policy

NIB Silver Advantage Hospital Plus

Bad value for money: This policy has restricted or no cover for some services including pregnancy and psychiatric treatment. But in all states, except South Australia and WA, it's more expensive than the cheapest gold policy that fully covers all treatments.

HBF

A nonprofit health fund, HBF was founded in Western Australia in 1941 and is headquartered in Perth. HBF has nearly a million members nationally with the majority of these in WA.

HBF's worst policies

HBF Silver Hospital Plus

Bad value for money: This policy has restricted or no cover for some services including pregnancy and psychiatric treatment. But in all states, except South Australia, Tasmania and WA, it's more expensive than the cheapest gold policy that fully covers all treatments.

Are big funds better than small funds?

Next to the big five funds, there are 21 other small- to medium-sized funds, and that's excluding restricted membership funds. You might be worried about going with a health fund you've never heard of, but some of these funds regularly come up on top in our health insurance recommendations.

Case in point: restricted membership funds – open to the families of teachers and defence force personnel, including reservists, police, nurses, union members and more – are often the best option for high cover gold policies.

So are there any disadvantages to joining a small fund? No. This is why:

  • Financial health: Health insurance is highly regulated; the financial health of all small funds is checked by the Australian Prudential Regulation Authority (APRA).
  • Out-of-pocket costs: Many small funds provide as good (in some cases better) protection against out-of-pocket costs as the large funds. That's because most smaller health funds pool together in a scheme called the Australian Health Service Alliance (AHSA), which negotiates their agreements with doctors and hospitals.
  • Provider schemes: While bigger funds might have large provider schemes and pay you better benefits if you go to one of 'their' providers, some smaller funds have those as well. And other small funds just pay you the same benefit wherever you go, which is a good option if you have a preferred dentist, for example.
  • Nonprofit: The majority of small funds are nonprofit, so they work only for their members, not shareholders. Of the big funds, only HCF and HBF are nonprofit. 

Read more about small health insurance funds.

28.9.20: An earlier version of this article included HBF Bronze Hospital Plus with Ambulance Care in WA. We have now removed Bronze policies from this article, stay tuned for an investigation in Bronze Plus policies.

We care about accuracy. See something that's not quite right in this article? Let us know or read more about fact checking at CHOICE.