Top Tips for Choosing Health Insurance
Our guide to family Choosing Health Insurance will give you peace of mind.
1) Don’t pay more to the taxman than you need
Attention: You could lose a portion of your taxable income due to the Medicare Levy Surcharge.
If you make more than $90,000. ($180,000 for families, couples, and single parents), then you could be subject to an EXTRA 1% MLS. This is in addition to the 2% Medicare Leviey that you already pay in taxes. This MLS fee applies to most people even if they don’t have private health insurance.
If you earn more than $105,000 ($210,000 for couples and families, and 1.5% if your earnings exceed $140,000 ($280,000 each for single parents and couples), the MLS will rise to 1.25%.
Contact the Australian Taxation Office for more information on the MLS or consult a tax professional.
2) You might consider giving your hospital coverage a health check
There are many great options for health coverage so don’t be afraid to switch funds. You don’t have to re-serve waiting times if you’re covered for a specific service under your hospital policy. This is protected by law. Many people don’t want to switch funds as they feel they must re-serve waiting times.
The law guarantees that you won’t have to re-serve waiting times for services that you were covered by your previous fund if you move funds. This is known as continuity of coverage. Make sure you review your policy to ensure that the premium is fair. iSelect recommends checking to make sure there are no waiting periods before switching funds.
3) Review your extras
Consumers often choose hospital coverage in addition to general treatment (extras). This covers services such as dental, physiotherapy and optical. There are differences between health funds in terms of what services you can get and what rebates you will receive. Make sure your coverage meets your needs and is affordable. You should weigh the cost of the policy against what you get in terms of benefits and services provided. Some policies have benefit limits that are per-person, while others set family benefits limits for each service.
A number of general treatment services can be bundled together and a benefit limit is applied to each bundle. The wide range of extras makes it difficult to compare. Call an iSelect consultant on 13 19 20 today and they will make your life easier.
4) Match the policy with your needs
You don’t have to have the same insurance for hospital and extras coverage. You could save money by using different insurance companies for your hospital and general treatment (extras). You may be wondering how? You may wonder how?
Review your current policy(s) and ensure that they are affordable and provide all services you require. This will help to reduce your out-of pocket expenses.
5) Use iSelect
iSelect makes it easy to shop for private health insurance. iSelect allows you to quickly and easily compare policies from all of its participating funds. iSelect will also allow you to compare your current policy with iSelect’s participating health funds.
6) Co-payments and excess, avoid these when you buy a Hospital policy
You can choose to pay either Excesses or co-payment options. They vary from one health fund to the next.
You should make sure that your hospital policy does not require you to pay an excess or a copayment for admissions. This could prove to be a costly mistake.
Explaining excess and co-payments:
An excess is an upfront payment you agree to make before your health fund benefits become payable. However, the excess can be applied to each admission into hospital during the year. It could also be cap at a maximum amount you would have paid in a single year.
A co-payment is a smaller amount that you pay each day for services you receive at hospital. If you are in hospital for three days, you would pay $150 ($50 per daily x 3). You could pay as much as $250 per day in co-payments. The co-payment you pay over a year is usually limited to a fixed amount. Day surgery is not covered by all hospital policies.
7) Pay a portion of the hospital bill
You could lower your premium if you agreed to pay a portion of the hospital bill. The premium will be lower if you pay more for excess or copayments. Some hospital policies are offered by health funds with either an excess, co-payments or both. Some funds do not require a copayment for day surgery.
You may want to select a hospital policy that has an excess of $500 for singles and $1,000 for couples, families, and single parents if you have a taxable income greater than $90,000. You can avoid the Medicare Levy surcharge, which requires you to pay 1% tax if your qualifying hospital coverage is not sufficient.
If you earn more than $105,000 ($210,000 for couples and families, and 1.5% if your earnings exceed $140,000 ($280,000 each for single parents and couples), the MLS will rise to 1.25%.
For couples, families, and single parents, the threshold amount of $180,000 increases depending on how many dependents you have. Contact the Australian Taxation Office for more information or to consult a tax professional.
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