This article will help you understand which type of health insurance most young and healthy singles lean towards. But everyone’s health needs are different, so make sure you consider what will be best for you and your personal circumstances. If you’re not sure, don’t worry — contact us and we’ll help you out.
Before we kick off, this little bit of info that will help a lot: health insurance is just an umbrella term for two types of cover, which are Hospital insurance and Extras insurance.
Hospital insurance covers you when you’re admitted to hospital for treatment (e.g. surgery), while Extras insurance covers everyday healthcare costs like dental, optical and urgent ambulance.
Alright! Let's get into those tips...
1. Stick with the basics
Unless you have a specific medical concern (e.g. chronic conditions such as diabetes) or you’re thinking about having kids soon, Basic Hospital insurance and Basic Extras insurance is a good place to start.
At a bare minimum, Basic Hospital insurance will include restricted cover for rehabilitation, hospital psychiatric services and palliative care.
Just be aware that ‘restricted’ is not a lot of cover. You may be left with large out-of-pockets if you need to claim on a restricted service.
On the up side, Basic Hospital cover will help you avoid the Medicare Levy Surcharge and Lifetime Health Cover loading.
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If you’re not keen on large out-of-pockets, you’re in luck—health funds generally provide more coverage than the government’s minimum requirements.
For example, with HBF Basic Hospital insurance, you’ll get full cover for five categories of treatment, including dental surgery and joint reconstructions, as well as restricted cover for rehabilitation, palliative care and hospital psychiatric services. And you’ll get Accident cover, too.
When it comes to Extras insurance, a Basic option will generally provide the least cover, and you’ll get less back than you would with a more expensive product.
But if you don’t claim often, Basic Extras insurance is a solid (and cheap) option. Basic extras covers services like Preventative Dental, Physiotherapy, Optical and Chiro.
2. Get to know what’s in and out
This is probably the most important thing to do when choosing health insurance.
It's kind of like ordering a burger.
It’s important to know what’s in it before you go ahead and order. If you don’t do this little bit of research, you could end up with a burger tainted with tomato. Alternatively, if you like that sort of thing, your burger could come without tomato. Devastating.
Take the burger analogy and apply it to your health, where the consequences are way more significant than a little food-related disappointment.
By thoroughly reviewing your product sheet (a summary of what’s covered) you can avoid landing in a situation where you’re not covered for what you thought. You can also avoid paying for stuff you don’t need.
Another tip: When comparing products, keep in mind there are different tiers of cover available for both Hospital insurance and Extras insurance.
The things that are included on each tier of cover can vary dramatically, so again, before you commit to a product, make sure you’re covered for the things you need.
3. Try to level up
At its core, health insurance is a safety net so when the unexpected happens you’re not left with a giant bill.
For that reason, if you’re tossing up between two tiers of cover, it’s generally better to go up rather than down. The more cover you have, the less likely it is you’ll be caught out when you need to claim.
And that’s particularly important when it comes to Hospital cover.
For example, you might find that a health fund's Basic Hospital cover doesn't actually cover much, and excludes common services like having your tonsils removed.
If you needed your tonsils out and didn't have cover for that service, you’d pay for treatment out of your own pocket at a private hospital.
Alternatively, you could wait a really long time to have them removed in the public hospital system. 1 in 2 people waited more than 121 days in the public system for a tonsillectomy in the 2018 financial year.
Every time you level up a tier, you'll get better coverage, which means it's less likely you'll get caught out when you need to make a claim.
4. Pick Hospital insurance over Extras
If you’re sticking to a budget and need to pick one of the two, Hospital insurance is the way to go.
Hospital insurance is the one you need to avoid the government’s ‘please get health insurance’ incentives. They are the Medicare Levy Surcharge (a tax) and Lifetime Health Cover loading (which makes hospital insurance more expensive if you take it out later in life).
Hospital insurance also gives you the peace of mind that, if you need hospital treatment, you can skip the public hospital waiting line by going to a private hospital instead.
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Plus, Hospital insurance let's you choose your time of treatment, so you can accommodate your other commitments like work or holidays. And you can choose your own specialist.
Extras insurance is generally not as important as Hospital insurance because costs rarely get as out of control in the Extras space as they do with hospital treatment. However, it's worth considering if you regularly claim for things like glasses or dental check-ups, because Medicare doesn’t pay anything towards those kinds of services.
5. Watch out for waiting periods
A waiting period is a set amount of time during which you’re paying premiums but can’t make a claim.
They exist to stop people from signing up to health funds, claiming, and then leaving straight away—this kind of behaviour drives up the cost of health insurance for other members of the health fund.
If you’re new to health insurance, you’ll generally have to serve a waiting period before you can claim.
The good news is, for things you might regularly claim—like glasses and standard dental check-ups—waiting periods are normally just 2 months.
Waiting periods are pretty standard across health funds. If you’re interested in finding out waiting periods for a service you need, you can check them out here for Hospital services and here for Extras services.
Bonus tip: If in doubt, reach out
If it all gets too much, don’t worry. We can do the heavy lifting for you.
Don’t hesitate to pick up the phone, or chat to us online if you need a hand—we’ll be happy to help you understand which health insurance option is best for your needs.
*Keen to do a little research on health cover with HBF? Check out our health cover options for young singles here.