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Private health premiums to increase in April

The lowest increase in 20 years is still above the rate of inflation

Last updated: 30 March 2021


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 April.
  • The average increase will be 2.74%, although some funds will increases prices more, including most large insurers.
  • The health insurance rebate will also decrease, driving prices up further.
We care about accuracy. See something that's not quite right in this article? Let us know or read more about fact-checking and corrections at CHOICE.

Health insurance premiums will increase on 1 April 2021. For most people this will be the second increase in six months, after many insurers delayed their 2020 increases until October.

At 2.74% on average, this will be the lowest increase since 2001. Some funds will have bigger price hikes than others: the lowest increase will be 0.5%, while one fund is set for a 5.47% price rise. Most of the big insurers have listed above-average increases.

Your health fund will let you know your policy's actual increase in early 2021, before the increase takes effect. If you can afford to pre-pay a full year's premium, you can do that before April to lock in 12 months of cover at 2020 prices.


Health Partners and St.Lukes Health have delayed their premium increases until 1 July 2021. Some of their policies scored well in our comparison – compare health insurance now to see if you can save money. 

Health insurance costs are growing faster than inflation

Despite the lowest increase in two decades, health insurance premiums are still growing quicker than wages or inflation, raising concerns that affordability is spiraling out of control.

"This premium price hike will make people question their need for expensive health insurance," says CHOICE senior campaigner Dean Price.

"This will be the second increase in most people's private health insurance premium in six months. The average increase may be lower than other years but people should check how much their specific policy is going up as it will vary. Some funds have average increases up to 5.47%."

Premiums have increased by 57% in the last decade, while the consumer price index (a measure of inflation) grew only 20%.

"The federal government needs to take real action to address issues that industry is unwilling or unable to fix themselves - we need a full review of the private health system," says Price.

"People can shop around and lock in a price if they pre-pay before April 1, but that is a short term solution when people have been crying out for real action on price and value."

Rebate cuts mean the price hike is bigger than it looks

While the average premium increase gets a lot of attention, your premium will increase on April 1 for another reason: a reduction in the private health insurance rebate.

This year it dropped by about half a percentage point, to 24.6% for under 65s on the base tier income. Older people and wealthy households will receive different rebate amounts.

The rebate amount decreases every year on the same day premiums go up. It was frozen for 12 months at the beginning of 2020 due to the pandemic, but it is set to reduce again in 2021.

The actual size of the cut is determined by how much premiums increase compared to the rate of inflation: the bigger the difference, the more the rebate goes down.

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