Rising Cost of Private Health Insurance Affecting Families
For families to have private health coverage, they need to pay as much as $150 to $200 or more every year. Premiums of private health insurance are rising by an average rate of 5.78% starting last April 1. In fact, Medibank Private, Australia’s biggest insurance provider company increased its premium by as much as 5.74%. Smaller players in the private insurance industry like GMHBA are asking for higher rates by more than 7%. The impact of the increase on family budgets place it just below 6.02% delivered in the previous year. However, there are signs of more leaps in rising premium rates for the coming days. This comes with the Government’s campaign to test the 30% rebate on private health insurance. Insurance providers are already computing the cost and will naturally make up for their expenses by passing it on to the insurance owners.
The timely call of Health Minister Nicola Roxon may help the pressing issue. She wants to cut the rebate for single people who are making over $75,000 as well as families with more than $150,000 income. Despite the concern on rising premium rates, the increase this year is said to be lower than last year’s. It is even lower than the expected rate by the insurance industry. In addition, the increase is considerably lower than the last five years under the Coalition Government, where the standard or average increase was placed at 6.63%.
Nonetheless, families are struggling to maintain their health insurance coverage. Faced with no other alternative, they would rather seek protection despite the expense than have none at all. Incidentally, payouts by private insurers have increased by 9.3% to $11 billion last year. The costs of health and medical fees have also increased by 5.9% as shown in the Consumer Price Index.
Furthermore, Medibank Private claims that the fund s already utilizing its clout as well as their purchasing power to make sure that premium rates remain affordable. The company is able to successfully protect its members for the full impact of increasing fees. They accomplished this by wisely buying health services and responsibly managing their business affairs. Another major player, HBA also posted a 5,39% increase. They are able to give competitive rates because of its efficient management as compared to other insurance providers.
To get by, families are choosing to cut some of the auxiliary services like dental and optical benefits in order to afford private health insurance for themselves and their children. Health coverage is important as a safety net when medical emergencies arise. Moreover, the insurance rebate change being proposed is being used as an arsenal for the coming elections with the Government hoping to have the backing of the Senate. Meanwhile, the opposition is set to encourage their members to dump their coverage, which will translate into soaring premium prices.