CHOICE membership

Will private health insurance save you money?

Private health insurance premiums will increase again this April, and health insurers and for-profit comparison sites are ramping up their advertising campaigns in a bid to retain customers.
Here’s a timely reminder that taking out cover isn’t always a necessity.

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I’m a Management Scientist, a systems analyst (not JUST IS) and used to work for a large private health insurer.
i) I’d bank the money you’re now paying to an insurer. in a High I account
ii) It’s not very ‘private’ given that it is regulated and assisted by the Federal gov’t.
iii) its purpose is to shore up the incomes of private specialists, consulting physicians, and private hospitals
iv) You don’t get much back, do you?
Timbo in Oz

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Choice argues that in the case of an emergency, your private health cover is essentially worthless, which may be arguably true. However, in the majority of cases where people seek health care, you will be faced with either being covered by private insurance, or Medicare. Choice appears to cite Medicare as a viable option to private insurance. So perhaps the better comparison is whether you choose to be treated in a public hospital or in a private hospital. If anyone argues that you get the same care and service in both, they are delusional.

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Waiting times is also another consideration. With non-urgent/elective hospital medical treatment waiting times significant in most states, one has to consider whether such waiting times are satisfactory and meet the expectations of the individual.

There are also reports that actual waiting times are significantly greater than the official numbers as state governments massage the numbers/manage waiting lists to show reduced waiting times.

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Personally I accept for the most part that I’ll lose money on my hospital insurance. Just the same as I lose money on my car insurance. It’s there as protection in case I ever need a procedure that is difficult or less comfortable to get done through the public system

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Which suggests private hospital cover may be all you need.

The one catch is for us older Australians with eye and dental concerns whether some extras cover is worthwhile to help soften the blows. There is often the circumstance that for country people public services are just not as readily accessible.

That dental is not covered by Medicare is one of the few reasons many seem to hang onto extras. Also one reason some older Australians avoid the dentist until it becomes too late.

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Three years ago, my mother was being treated for cancer. The leading specialist in the field performed his procedures at the local public hospital only. He would not provide services at the adjacent private hospital.

I admit, that in the field of medical specialists, he was an exception to the general rule.

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Doctors are not saints. When asked to choose between serving the community and themselves most choose a bit of each. There are exceptions of course.

We see the specialists to the rich and famous trying to get as rich and famous as their clients. We see arrogant pricks in big hospitals who treat their staff and clients like inferior beings.

We also see country doctors who work very long hours for decades because they see the need and will not quit or move to make life easier or to earn more. They are often much loved and sometimes even told so.

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For some of us it is not a choice. I cannot afford private, and my dental and visual needs I pay out of pocket. Likewise specialist visits. Generally that costs way less than the annual cost of private insurance.

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Yes it’s expensive, but I will be paying .

Was talking to one of the customer service people while getting a non existent dental refund & she showed me that they have paid me more than I paid them.

Great in that instance, but on average those of us with private cover always seem to pay more than we get back. Stay healthy in old age they win. Get really crook in old age you may come out financially ahead. I’ve no desire to be crook just to get my money back.

If you choose not to have private cover, or would find it an unacceptable expense? The public system in NSW and Qld from close experience does a great job when you really need to be in hospital.

Going public would appear to be better value, especially if you put a little aside each month for the unexpected. Not being in the queue in the public system for some procedures, EG a knee replacement or similar may be a benefit of private cover, but unlikely to be better value.

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Private health insurance may not save you money but it can save a 4 year wait.

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A personal story from CHOICE that rings true to the long waiting times within the public health system.

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Back in 2005, I was waiting for elective surgery in a public hospital. I was initially told I would need to wait 9 months, and after waiting 8 months was then advised that I would need to wait an additional 9 months.

I then discovered that NSW Health has the (not well advertised at the time) Elective Surgery Waitlist Management Resource Guide.

Long story short: I was able to find another nearby public hospital where the wait time was less than 3 weeks. I had the procedure conducted there and all went well.

Of course, this system is really only useful for patients living in large urban areas in NSW.

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Or never getting to the specialist clinic at all. I was referred to an orthopaedic fellow about my knee, and 5 years later had still not received an appointment with him, though they offered me one with another fellow… who I knew socially and didnt want him mucking about with my knees. What would have been easier would have been to pay for a consult in his rooms, which would have revealed there were no real problems that could not be solved by means other than surgery. Like getting supportive shoes. And I would have known 5 years earlier, to boot.

Just recently I had an appointment with an ENT guy about my nosebleeds (oh yes, they are whoppers… 2-3 hours a time)… and he sorted it out in his rooms. $150, ad $75 back from medicare.

I dont go to the public clinics anymore.

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Health care and value as perceived by the human involved are not necessarily synonymous. When one needs (esp non-emergency) health care value is often irrelevant to getting it, finances willing. eg. What is the value of having a hernia repaired this year at $$$ compared to 2 or 3 years hence at $ or ’ '?

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have have been a member of an industry fund since I started work I pay for highest cover and under my inexpensive cover my son was covered until he finished 6 years at uni. I am thankful for it, once I went to a private hospital because an emergency and it was close, the nurses were wonderful, the place appalling and I was given and left with extreme Seratide corticosteroid dosage and had 12 years on it after for newly formed asthma, I also spent a week at the Alfred Public , superb hospital. years later as consequence, When I spoke to the payment person, she was immensely grateful I paid from my private insurance which covered everything for them. I am glad to pay my own way, This is how Australia used to be, we loved our country and cared for it, were not trying to rort whatever we could from others.
I pay a fair amount, if hospitalised everything is fully covered. My health fund has paid out hundreds of thousands on one member some years back. They use recycled paper. Are kind, Will consider adding alternative therapies if they work. I

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Private health insurance can’t possibly save you money. Insurers must charge much more than they pay out to cover administration, including high salaries typically paid to senior staff in the “not for profit” sector and profits and high senior salaries in the many for-profit insurers.

Private health insurance may allow faster treatment than our under-funded public health system allows, and in odd cases, may save an individual money if they chose to go private, but overall, the idea of saving money is an illusion.

Unless you are in a higher risk category who is going to be subsidised by the top up from the government and those in the lower risk category. That is the peculiar thing about health “insurance” in comparison to say car or household insurance, mostly the premiums don’t go up with risk++. People with chronic serious diseases might save money all their lives.

So if a person is young and healthy what you say is right, if they are old or unhealthy you are quite likely not. Viewed as insurance, rationally there are some people who should be members and others who should not.


++ Except in the case of the late joining penalty.

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And unfortunately one may not know what category one is in until it is too late. I suspect that in many cases, those who found themselves unexpectedly in the higher risk categories and chose not to have private health insurance, wish they had hindsight.