It's important to regularly review your health insurance requirements at different stages in your life to check whether you have a policy which is suits your healthcare needs and which covers the treatments you may need.

Although premiums are a factor to consider, it's also important to check what is and isn't included on your policy, and whether excesses, co-payments and benefit limits will influence the total cost to you for any treatment. The cheapest policy may not necessarily be the best or right for you.

It's important to regularly review your health insurance requirements at different stages in your life. The policy that suited you when you purchased it may no longer meet your healthcare needs or cover the treatments you want to include.

When shopping around for health insurance, you should consider what level of cover you need, who is to be covered, the services and medical procedures you require, and whether you are willing to reduce your premium by paying an excess or co-payment each time you go to hospital. 

Be sure you consider more than just your premium - consider how comprehensive the cover is, and how excesses, co-payments and benefit limits will influence the total cost to you for any treatment. The cheapest policy may not be the best or right for you.

Lowering your premiums

If the cost of your insurance has become a concern, you can manage your policy to allow you to have lower premiums.

Some health insurers provide discounts depending on your situation, rate protection if you pay in advance and you may be able to suspend your membership for a time rather than fall behind in payments.

Some hospital policies will give you full cover for hospital fees and in-hospital medical charges. Other hospital policies require you to meet some of the costs, in exchange for lower premiums. Other hospital policies do not cover services that you may not need at your stage in life. You can agree to:

• exclude certain services or condition from your policy (exclusions), for example pregnancy birth, or
• only receive limited benefits for certain services or conditions (restricted benefits), or
• pay a set amount towards the cost of your hospital treatment (excess or co-payment).

Exclusions

If your policy has an exclusion for a particular condition or service, you are not covered for treatment as a private patient in a public or private hospital for that condition or service. You will face considerable out-of-pocket costs if you seek treatment as a private patient.

For example, if your policy excludes pregnancy and birth, or hip replacements and knee replacements, and you go into hospital as a private patient for one of these conditions, your health insurer will not pay any benefits towards your hospital and medical costs.

If you urgently need treatment for an excluded condition or service, you can seek treatment as a public patient or cover the full cost of the treatment yourself. If you have time, you can contact your health insurer and upgrade your policy to remove that exclusion, then serve the waiting period before seeking private treatment.

Restricted Benefits

If your policy has restricted benefits for some conditions or services, you will have a limited amount of cover for treatment of those conditions. You will face considerable out-of-pocket costs if you seek this treatment as a private patient.

If you need treatment for a restricted condition or service, you can seek treatment as a public patient, or seek treatment as a private patient in a public hospital, or cover some or most of the cost of the treatment yourself. If you have time, you can contact your health insurer and upgrade your policy to remove that exclusion, then serve the waiting period before seeking private treatment.

Excess

An excess is an amount of money you agree to pay for a hospital stay, before health insurer benefits are payable. This is sometimes referred to as a front-end deductible.

For example, if your policy has an excess of $200, you will be required to pay the first $200 of your hospital costs should you go to hospital as a private patient. An excess may apply every time you, and anyone else listed on your hospital policy, go to hospital in a year, or may be capped at a total amount that you will have to pay if you go to hospital more than once in a year.

Co-payment

With a co-payment, you agree to pay a set amount each day you are in hospital. This can also be referred to as an overnight excess, daily excess or patient moiety.

For example, a policy may have a co-payment clause that requires you to pay the first $50 for each day of hospital accommodation. If your policy has such a co-payment and you were in hospital for five days, you would have to pay $250 ($50 x 5). The total amount of co-payment you pay per hospital stay is often limited to a set maximum amount.

Discounts

Health insurers may offer discounts on premiums for people who:

• pay their premiums at least three months in advance;
• pay by payroll deduction;
• pay by pre-arranged direct debit;
• have agreed to communicate with the private health insurer and make claims under the policy by electronic means;
• belong to a contribution group under the rules of the insurer, e.g. your health insurance product is organised through your workplace or an organisation you belong to; and
• where the insurer is not required to pay a state or territory levy (e.g. if you are a pensioner or a low income earner in New South Wales or the Australian Capital Territory, your premium may be reduced because you are entitled to free ambulance cover).

Check with your health insurer to see if you are eligible for any of these discounts.

Rate protection

If you can pay your premiums 12 months in advance, some insurers will offer a rate protection policy.

With a rate protection policy, you pay for the entire 12 month period at the rate on that day. If the rates increase during your pre-paid period, those increases in rate do not impact you until your 12 months of cover ends.

If you do not have a 'rate protection' policy, the insurer will ask you to pay the balance owing on the new rates, or reduce the length of time your advance payment covers. 

Failure to pay

If you fall more than two months behind in paying your contributions, you will not be insured.

Some insurers may not accept payment of arrears in excess of two months. When you resume your payment, the insurer may impose waiting periods before you can claim benefits again.

It is your responsibility to make sure that your premium payments are up-to-date and you remain financial with your health insurer.

• If you are having difficulty keeping up with your payments because of a temporary problem, talk to your insurer to see if they will agree to a payment plan.
• If you pay your premiums by a regular direct debit from a credit card or bank account, check each bank statement to make sure that the payments have been correctly debited.
  

Suspending your membership

Health insurers may grant suspensions for an agreed period of time, at their own discretion, for circumstances such as working or studying overseas, financial hardship or temporary unemployment.

During the suspension period you will not be able to make claims. If you are over the income threshold, you will be required to pay the Medicare Levy Surcharge for the suspension period. Suspension rules differ between insurers so you should check to see if you will need to serve any waiting periods after your suspension period ends.

Suspending your membership with the agreement of your health insurer will not affect your Lifetime Health Cover  (LHC) entitlements, meaning that for LHC purposes you are taken to be retaining your hospital cover. If you are paying a LHC loading at the time your membership is suspended, any period of suspension does not count towards the 10 years before your LHC loading is removed. 

Keep your details up to date

Always let your health insurer know about any changes in your circumstances that might affect your cover. This includes change of address or contact details, changes in your family circumstances (e.g. adding newborn children to your policy), going overseas, or advising of a change in Medicare status.

Keeping your health insurer informed about changes in your circumstances can help to avoid problems when you need to use your health insurance.

To make sure you receive notification of any changes to your cover, notify your health insurer if you change your postal address or contact details.  If you move interstate, this might affect the amount of premiums you pay or the benefits you are entitled to. 

Leaving or moving insurers

If you want to move from one insurer to another, you will not have to re-serve waiting periods if you transfer to a policy that is at the same or a lower level of benefit. 

• Your new insurer must give you continuity for the waiting periodsyou have already served. However, if your new plan includes new or higher benefits that were not part of your old policy, you will have to complete a waiting period before you can access those benefits.
• You only have a limited time to change between insurers without losing continuity of your waiting periods. Check with your new insurer - some insurers will allow a break of up to two months but others may allow only one week. If you lose your continuity, you will have to re-serve waiting periods.
  
• Benefits paid by the previous insurer may be taken into account by your new insurer when it determines your annual benefit limits.
• Checked whether any accrued benefits, credits or bonus points with your original insurer can be transferred to the new one - usually they cannot be transferred (e.g. accrued orthodontic benefits). 
• Make sure you read all the documents you receive from the new insurer within your first month of membership. If there's anything you don't understand, contact the insurer.
  
• Transferring between insurers will not affect your Lifetime Health Cover (LHC) entitlements, provided that you retain hospital cover.
• If you decide to cancel your policy, your health insurer should pay back any contributions you have paid in advance. The insurer may deduct a small administration charge.