Australians hit by new cost of living hike as private health insurance premiums rise

Australians hit by new cost of living hike as private health insurance premiums rise

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Private health insurance premiums will rise by a little over 3 per cent from today after the government signed off on the increases last month.

The new premiums came into effect today on April 1, leaving households with yet another increase to the weekly budget.

Health Minister Mark Butler had initially rejected higher premium increases put forward by insurers, eventually approving an industry-average 3.03 per cent hike – lower than inflation and wage growth but still the largest percentage increase since 2019.

You can check how much your health insurance provider is raising premiums in the table below.

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“I asked insurers to go back and sharpen their pencils and put forward a more reasonable offer for the 15 million Australians with private health insurance,” he said.

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“While we know that any increase will be hard to bear during a global cost of living crunch, the Albanese government has ensured that health insurance premiums will fall relative to Australians’ wages.

“Private health insurers must ensure their members are getting value for money. When costs rise, Australians want to know that higher premiums are contributing to system-wide improvements, like higher wages for nurses and other health workers and ensuring that affordable services are available.”

While 3.03 per cent is the average increase across the industry, the exact hike differs from provider to provider.

Commonwealth Bank-owned insurers CBHS Corporate Health and CBHS Health Fund had the sharpest increases of 5.82 per cent and 4.51 per cent respectively, followed by NIB at 4.1 per cent – a rise it puts down to increasing costs and the ageing population.

“We’re doing our very best to maintain affordability yet spending is growing across healthcare, driven by an ageing population, the rise of chronic conditions and the cost of new technologies,” NIB chief executive and managing director Mark Fitzgibbon said.

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“We’re not sitting back passively responding to inflationary pressure by just lifting premiums.

“We have a range of new measures designed to help members maintain good health as well as reduce out-of-pocket expenses.

“Essentially, we’re trying to provide members with more value for their premiums.”

At the other end of the scale, Health Care Insurance had the smallest rise of 0.27 per cent, followed by Defence Health at an even 1 per cent and Australian Unity Health at 1.42 per cent.

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Getting more value from your health insurance

The increases mean the average family will pay an extra $181 per year, according to finance company Compare Club, while single policyholders will see their bills increase by $96 and couples $201.

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“It’s important to remember that 3.03 per cent is an industry average only, and some policies could increase by more,” Sophie Ryan from comparison website iSelect said.

“Funds are required to let their members know if, when and how much their policy is increasing and this should be your prompt to shop around and compare your policy.

“It’s understandable some Aussies will be left questioning whether they can even afford to keep their health cover, but I’d encourage policyholders worried about these price increases to first make sure they’re getting good value and whether they could switch and save.”

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