Updated: 8 February 2019
While most people think of ‘health insurance’ as one product that covers everything, it’s really an umbrella term. There are many components you can chop and change to suit your needs.
Understanding how each works is the key to finding potential ways to save on:
- Hospital insurance
- Extras insurance
- Ambulance insurance
Hospital insurance helps cover your costs for treatment in a private hospital. You can also use it to cover
a public hospital.
If you’re confused about why you would use private insurance in a public hospital, you can read
all about it here.
For now, we’ll focus on ways to reduce your Hospital insurance premiums.
Ways to save
The first thing you can do is review your level of cover. HBF’s highest level of Hospital insurance is
It covers you for all procedures and services covered under the Medicare Benefits Schedule.
To save money, you can choose (or switch to) a lower level product.
Lower level products exclude
or restrict cover for a small number of more expensive services like maternity, heart treatment or
cataracts, making them a bit cheaper.
The good news is you get the same amount back when you claim regardless of which hospital product
the only thing that changes are the procedures you can claim on.
The challenge is you don’t always know what services you might need in future. For example, switching to a
that excludes maternity may also mean inadvertently dropping cover for heart treatment. So be careful you
accidentally drop cover for something you might really need.
Another way to save is to add or increase your
Hospital insurance excess is just like an excess for your car or home insurance—it’s something you pay
out of your own pocket when you go to the hospital.
By adding an excess to your Hospital insurance,
bring down the price. If you already have an excess, consider increasing it to lower your premium.
* Provided you don’t have restrictions
on your policy.
What happens if you cancel?
If you’re young, healthy, and have no history of genetic illness in the family, you could consider dropping
insurance for a while and only keeping your Extras insurance. However, this is not without its risks…
Firstly, not having private hospital cover means if something goes wrong, you will have to rely on the public system
out $1000s to access treatment in the private system. If you try to take out Hospital insurance again later, you
have to re-serve any waiting periods, which includes a 12-month waiting period for pre-existing
Secondly, if your income is more than $90,000 (or $180,000 per household), dropping Hospital insurance means you
hit with the Medicare Levy Surcharge
extra tax the Government imposes on higher income earners who don’t have Hospital insurance.
Lastly, if you’re over 31 and you drop your Hospital insurance, you may be subject to Lifetime
Health Cover loading if you decide to take it back out again in future. The LHC loading basically means
that if you get Hospital insurance
again when you’re older, you will pay more for it than everybody else—2 per cent more for every year
age 30 that you didn’t have cover.
Extras insurance covers you for treatments outside of the hospital—things like dental, optical and chiro.
services Medicare generally doesn’t cover, so without Extras insurance, you’d pay the full cost out of
Ways to save
Extras insurance works differently to Hospital insurance, in that changing your level of cover impacts both the
you’re covered for as well as how much you’ll get back.
Generally, you can save money on Extras insurance by choosing a product with:
- Lower benefits (the amount of money you get back when you claim);
- Lower annual limits (the amount you claim up to over the course of a calendar year);
- And/or fewer services.
You can compare different levels of Extras cover here.
You could also get more value for money by increasing your benefits, annual limits and the number of
That’s because most extras services generally involve an out-of-pocket cost. By increasing your level of
your insurer will pay more of the service cost, reducing the amount you pay out of your own pocket.
What happens if you cancel?
To quickly and significantly lower your health insurance premium, you could cancel your Extras insurance and just
The Government has no penalties for not having Extras insurance. (So you won’t have to pay the MLS for not
or be subject to the LHC if you take it up again later). The only kicker is you’ll have to pay 100 per cent
the cost for things like optical and physio because Medicare generally doesn’t pay anything towards those
You will also have to re-serve wait periods if you choose to take Extras insurance out again in the future (usually
from two to 12 months depending on the service).
As the name suggests, Ambulance insurance helps cover the cost of ambulance transport.
In most states (except Queensland and Tasmania), Medicare doesn’t cover the cost of emergency transport and
services. That means you could pay up to $1000 out of your own pocket if you need an ambulance.
With HBF, there are two types of ambulance insurance: Urgent
Ambulance and Ambulance Care.
Urgent Ambulance insurance covers the cost of emergency or urgent ambulance transport by road. It also covers any
where you’re transported to the emergency department. It’s the state Ambulance provider (e.g. St. John
that figures out whether your situation requires an Urgent Ambulance—not you. Even if your situation
require an Urgent Ambulance, a non-urgent ambulance may still arrive at the scene; if this happens, you will have
pay the call-out fee. While they aren’t very common, HBF’s Ambulance Care insurance is
that covers you for any non-urgent situations.
This is useful because in highly stressful and potentially life-threatening situations, you don’t want to be
yourself worrying that you’ll be charged a massive call out fee if it turns out to be a false alarm.
Ambulance Care also covers the cost of ambulance transfers by road, either from one hospital to another, or from the
to your home.
Ways to save
Most HBF Hospital and Extras products automatically include cover for Urgent Ambulance. However, if you only want
an ambulance in an emergency situation, you can take out Urgent Ambulance insurance separately, without needing to
Hospital or Extras insurance.
Because Ambulance Care (the non-urgent one) is an add-on, you can remove it to help reduce your premium. However,
$0.55/week, it would be a low reduction for
that could save you a lot of money in the future.
ways to get more from your HBF health cover
There are heaps of easy things you can do to make sure
you’re getting mileage out of your HBF health cover. Here are our top 4 tips to get you started.
Was this information helpful?