Many people join a health fund and then never get around to reviewing their cover. Over time, people’s health care needs change—and health funds often change the benefits and premiums of their policies. So after you’ve been a member of a policy for a few years, the policy you have may no longer be the best one for you. It’s important to have a good look at your needs every year to make sure your cover is best suited to your requirements. You can undertake the review yourself or you can use HICA’s free, no obligation health cover review service.
Most people can name only 4 or 5 health funds—and they probably belong to one of those. But there are dozens of health funds operating in Australia—many with exceptionally competitive covers and premiums. And you don’t need to be afraid of switching funds. Legislation now gives health fund members the right to switch funds on the same level of cover—without having to serve new waiting periods in most cases—even if there’s a pre-existing illness or condition. Learn more about switching health funds.
You don’t have to buy your hospital cover and extras cover from the same health fund. By separating these two policies, you will have a much broader range of options to choose from. With HICA’s help, you can often arrange each component with a different fund to give you more appropriate cover, better rebates and premium savings.
By choosing an excess on your hospital cover, you agree to pay part of the bill if you go to hospital. In return, the health fund gives you lower premiums. Excesses can range from $250 up to $1,500. The more you agree to pay (i.e. the higher the excess) the lower your premiums will be. So if you’re unlikely to need to go to hospital, choosing an excess is a great way to save.
The Medicare Levy Surcharge is an extra tax of 1.00%, 1.25% or 1.50% (depending on income tier) and is in addition to the normal 2% Medicare Levy. You have to pay the Medicare Levy Surcharge if you don’t have eligible hospital cover and have an annual taxable income* of greater than $93,000 for singles, or greater than $186,000 for families (the family income threshold increases by $1,500 for each dependent child after the first). So singles with a Medicare Levy Surcharge liability can expect to pay an extra tax of at least $930 p.a. and families will pay $1,860 pa or more. Learn more about the Medicare Levy Surcharge.
*Taxable income for Medicare Levy Surcharge purposes includes Reportable Fringe Benefits.