Should you drop extras health insurance?
Private health insurance is increasingly expensive and your extras health insurance may not be giving you value for money.
Last updated: 5 Mar 2026
Unlike hospital insurance, which covers you for treatment in hospital, extras insurance helps pay for services outside of hospital, such as dental care, glasses and treatments like physio or chiro.
Most extras policies only pay a percentage or capped amount towards the cost of these services. According to APRA*, on average:
- Health funds pay just $68 for a visit to the dentist, $84 for the optometrist, $42 for a trip to the physio
- You’re still out of pocket $63 for each visit to a covered service
- you only get $498 per person per year in total from your extras policy.
*APRA quarterly health insurance statistic, December 2025.
If your extras insurance doesn’t pay out more than your extras premium, it pays to either switch to a better policy or drop it altogether. Compare health insurance now to see if you can get a better deal.
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The average extras cover for a single person costs about $684 per year (without the health insurance rebate). And with the average person only receiving $498 per year in value, it follows that plenty of people would be better off without their extras insurance. Therefore, it’s essential you shop around. There are is a wide range of covers and premiums to choose from, or you may decide you don’t need extras cover at all.
Bupa and Medibank extras health insurance
Australia’s two biggest health insurance companies, Bupa and Medibank, have a range of extras policies. The catch with their policies is that to get the full benefits, you need to use their provider network. If you want to use your own dentist and they’re not in the network, your benefits will be smaller.
Bupa, Medibank – most expensive extras health insurance
- Bupa’s most expensive extras cover is Top Extras 90 and costs about $2440 per year*.
- Medibank’s most expensive extras cover is also called Top Extras 90 and costs $2107 per year*.
- The deal with both policies is that they cover a wide range of services including specialist services like hearing aids or home nursing and pay around 90% of your bill up to annual limits at their associated providers. Bupa and Medibank pay at least 90% for popular services including dental, optical, physio and chiro, as long as you go to one of their network providers. You can go to providers outside the fund’s network but you may receive a smaller benefit.
- It’s a tall order to use enough services to get your premium back in benefits, let alone more, therefore we’ve called them bad value extras health insurance.
Bupa, Medibank – cheapest extras health insurance
- Bupa’s cheapest extras cover is Extras Saver at about $192 per year.*
- Medibank’s cheapest extras cover is Healthy Living Extras at about $239 per year.*
- Bupa’s policy pays up to 50% of your bill at all providers for general dental up to a total maximum limit of $350 (or you may get up to 100% back for 6-monthly check-ups at their provider), and that’s it. If you need a physio, a new pair of glasses or a massage it’s not covered.
- The Medibank policy’s draw card is also dental, with 100% off one check-up per year covered at a member dentist. They also offer up to $40 back for one vaccination per year, and 20% off a gym membership at certain gyms. There’s no cover for chiro, physio, glasses or anything else.
- Both policies also include ambulance cover – read more about ambulance cover.
- Are they good value? Not really. You may be able to claim back a little more than you spend on the premium with Bupa’s product – it is easier to make sure you get your money back with cheaper extras products than with the most expensive policies. But with Medibank’s Healthy Living Extras, if you don’t use their member provider’s dentist your payout is capped at $100 per year. Even if you claim all of this, plus the full benefit for a vaccination ($40) each year, that’s only $140 back for a policy that costs $239/year (or $180 will the full 24% health insurance rebate). Even if you claim 20% off a gym membership, it certainly doesn’t sound like good value to us!
While Bupa and Medibank have a good range of extras policies, some other providers offer better value cover. Compare health insurance to see what your options are.
*All premiums are for singles in NSW without the health insurance rebate, February 2026.
Considering that many people pay a higher extras premium than what they get back in benefits, it’s important to work out if your extras health insurance is offering you value for money.
- Request or download an annual claims statement from your fund’s website, which shows the total benefits you received in the last financial year.
- Compare your premium with your extras benefits. Are you paying more than you’re getting in return?
If, like many people, you have a combined extras and hospital policy, a bit of maths will come in handy.
- Select a hospital insurance policy from your fund that’s comparable to the hospital cover in your combined policy (with the same excess and cover level).
- Deduct its price from the premium you pay.
- The difference will be the amount you pay for extras health insurance.
If you find your premium is substantially higher than the benefits you receive and you don’t anticipate your health needs will change any time soon, consider switching to a less expensive policy or cancelling extras health insurance altogether.
If you cancel your extras insurance, be aware that you’ll be subjected to waiting periods before you can make a claim if you take up extras again. If you switch cover, your new provider may not make you wait again if the new policy has similar benefits.
Will I be penalised if I drop extras cover?
Perhaps you signed up for health insurance to avoid the government’s Medicare Levy Surcharge (MLS) and the Lifetime Health Cover (LHC) loading. Well, your insurer might have “forgotten” to tell you that government surcharges only apply if you don’t have private hospital insurance – you don’t need extras insurance to avoid the charges. Check if hospital insurance can save you money at tax time.
CHOICE tip: Health insurers often have specials that allow new members to claim straight away for many health services like a dental check-up or physio treatment (although usually not the more expensive services like dental crowns or braces).
Extras health insurance works differently to other types of insurance.
- Home, travel and car insurance cover you for unexpected events that may otherwise cost you thousands. You pay a known amount (the excess) and they cover the rest.
- Extras insurance works more like a budgeting tool. The insurer pays a known amount, or percentage, and then you cover the rest. It’s meant to help with smaller ongoing costs, such as a dental check-up, pharmacy costs, physiotherapy, going to the osteopath or a new pair of glasses.
Two groups of people tend to get good value from extras insurance.
- Families: Families pay the same health insurance premium as couples – or double the singles premium – so children are insured for free. Some health funds offer no-gap cover for kids, for example for dental. Read about the best health insurance for families.
- People aged 55–79: Of all the age groups, this one makes the most claims on their extras cover benefits and therefore receives a much larger average benefit per person than other age groups. Read about the best health insurance for seniors.
Couples, on the other hand, can lose out. A couples policy normally costs exactly the same as two single policies. So if a basic policy suits you best but a medium policy suits your partner better, go for two different extras cover policies rather than a medium-cover couples policy. Read about the best health insurance for singles and couples.
Tips and tricks to get more out of extras health insurance
Look for percentage benefits
Rather than simply paying a fixed amount for a service, such as up to $30 for a physiotherapy session, some policies cover a percentage of your bill, usually from 60% up to 100%. This can be useful if you go to a dentist or other healthcare provider who charges above-average prices. Where these types of benefits apply, it’s worth making sure they apply to the providers you usually use.
Look for funds with provider schemes
A number of health funds offer provider schemes or even their own optical or dental centres. The fund may have negotiated a price (usually lower than the normal price) with, for example, the dentist or optometrist, and may also pay a higher benefit to you. Full cover for services such as a dental check-up or a pair of glasses is sometimes available.
Check for loyalty bonuses
Some health funds pay higher benefits to loyal members. While this is good for you if you’ve been with them for a long time, it can be a disadvantage for new members since your time with another fund is not counted towards these bonuses.
Have you used your lifestyle cover?
Some extras policies offer benefits for services such as massage or gym classes and even sunscreen.
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Jane Bardell is a Content producer in the Insurance and utilities team. She writes about home, car, pet and health insurance. Previously at CHOICE, she checked facts, figures and statistics as a Verifier with the Editorial and investigations team.
Jane has a Bachelor of Science from the University of New South Wales.
Find Jane on LinkedIn.
Jane Bardell is a Content producer in the Insurance and utilities team. She writes about home, car, pet and health insurance. Previously at CHOICE, she checked facts, figures and statistics as a Verifier with the Editorial and investigations team.
Jane has a Bachelor of Science from the University of New South Wales.
Find Jane on LinkedIn.
