Australians are being urged to prepare for one of the largest increases in health insurance premiums in recent years, with costs expected to rise by as much as 6% from April 1. The increase, forecasted by Compare Club, could see policyholders paying an average of $234 more per year, placing further strain on household budgets already impacted by the cost-of-living crisis.
Expected Premium Increases Across Different Groups
The projected 6% rise would result in notable financial impacts across various demographics:
- Retired families may face an increase of up to $369 annually, potentially bringing their total health insurance costs to nearly $6,000 per year.
- Couples over 65 could see their premiums increase by $358.
- Young families may need to budget for an additional $248 per year.
- Singles could see a rise of $153 in their health insurance costs.
- Single-parent households may experience an increase of $224.
These figures highlight the growing financial burden on Australians who rely on private health coverage.
Why Health Insurance Premiums Are Increasing
Each year, private health insurance funds propose premium increases to the government, which are subject to review and approval by the Health Minister. While the 6% increase is described as a “worst-case scenario,” Compare Club’s head of research, Kate Browne, has advised Australians to prepare for a substantial rise.
“Even if the funds are negotiated down by the health minister, we’re still expecting a significantly bigger premium hike than last year,” Browne said.
Cost-of-Living Pressures Impacting Private Health Cover
Rising health insurance costs are coming at a time when many Australians are already struggling with broader cost-of-living pressures. A study by Finder revealed that:
- 1 in 7 Australians found it difficult to pay for their health insurance over the past 12 months.
- 3% of policyholders had to cancel their cover entirely due to affordability concerns.
These findings suggest that more Australians may opt out of private health insurance, increasing reliance on the public healthcare system.
Strategies to Manage Rising Health Insurance Costs
In light of the expected premium increases, experts are encouraging Australians to review their health insurance policies to ensure they are receiving the best value.
“Our data shows families who switch to better-value policies can save an average of $462 per year,” Browne said.
For those facing financial difficulties, possible cost-saving measures include:
- Comparing policies from different providers to find better deals.
- Adjusting coverage by removing unnecessary extras.
- Considering higher excess options to reduce monthly premiums.
As the April 1 price increase approaches, Australians are being advised to take proactive steps to manage their health insurance expenses and lessen the financial impact.
