With the health insurance industry set to undergo the biggest change in decades as new Gold, Silver and Bronze tiers are introduced from 1 April, it's not surprising that the subject is creating concern for Australians.
But despite the uncertainties, our experts are warning that it could be a mistake to make a hasty decision on a new policy prior to the roll-out of the new system. This advice comes after we reviewed more than 1700 health fund letters forwarded to us by consumers trying to make sense of the changes to their cover.
"We asked our community to pitch in and help us understand these changes. What we found was a health insurance system in a state of mess," says CHOICE spokesperson, Jonathan Brown.
VIDEO: CHOICE talks to ABC TV's 7.30 about the changes to health insurance
Getting the right advice
Until the new system is in place it's impossible to get a clear picture of what options will be available to people seeking private health insurance, but that's not stopping some comparison services from offering advice.
Watch out for the commercial comparison sites – they're pushing sales calls onto a stressed and confused community
"It's frankly dishonest for anyone to say they can provide a true comparison of the health insurance market right now. New policies will be released over the coming weeks and months that will change in coverage and price. Until we have all the facts about the quality of cover in the market, no one can tell you what the best value for money policy will be for your needs," says Brown.
As our experts work their way through the changes, we've decided to pause our health comparison tool, since the current state of the market means it's impossible to offer useful recommendations.
"Watch out for the commercial comparison sites – they're pushing sales calls onto a stressed and confused community and right now they're providing recommendations about a market that's changing rapidly. What's a good deal today, may be a terrible deal in a few weeks as cover and costs change," explains Brown.
"With the help of our supporters, our experts will be digging into the detail and sharing what we find. Our advice is that people in most circumstances should wait until after 1 April before making any big changes to their health insurance," says Brown.
Advice for a changing health insurance landscape
While assessments of the new health insurance system offerings are ongoing, our experts have put together a list of the top five things you need to know about the changes. They also offer this advice:
- If you're expecting a particular health need (such as pregnancy or a hip replacement) check your policy before 1 April. If you've lost cover under the new changes, you need to switch to higher cover before the changes hit – you could be stuck with a new waiting period.
- If you are currently undergoing treatment, have surgery booked or are pregnant, check with your fund if you're affected by the cover changes.
- If you're not expecting a particular health need, your range of policy options will significantly change from 1 April. What looks like a good deal now may be bad value after 1 April.
- The average premium increase is 3.25%, but we've seen a number of letters that show higher costs, with fewer benefits.
- If you have the capacity to do so, prepay the best deal you can get now for the coming year. If a better policy becomes available after 1 April, you can get a refund on your pre-paid premiums.
In the meantime, see our guide to making sense of the letters
health funds are sending their members to explain the changes, and we'll continue to offer free expert advice here on our site.