Australians already know that health coverage can provide security for individuals and families when a medical need arises. Many, however, do not know how to find the best value when comparing health insurance policies.

Below are 10 tips everyone should read before shopping for private health coverage.

1. Choose coverage that concentrates on your specific health needs, or potential health needs.

The first thing you should do before comparing your health plan options is determine which policy features best fit your needs. A 30-year-old accountant, for instance, is going to need very different coverage than a 55year-old pro golfer, or a 75-year-old retired veterinarian. By understanding the health needs that most often correspond to people in your age and activity level group – your life stage – you can save money by purchasing only the coverage you need and avoid unnecessary services that aren’t relevant. For instance, a young family with two small children isn’t going to need coverage for joint replacement or cataract surgery. A 60-year-old school teacher isn’t going to need pregnancy and birth control-related services.

Whether it’s high level comprehensive care you’re after, or the least expensive option to exempt you from the Medical Levy Surcharge while providing basic care coverage, always make sure you’re comparing health insurance policies with only those services that make sense for you and your family.

2. Consider options such as Excess or Co-payment to reduce your premium costs.

When you agree to pay for a specified out-of-pocket amount in the event you are hospitalized, you sign an Excess or Co-payment option that will reduce your health insurance premium.

If you choose the Excess option, you agree to pay a predetermined, specific amount when you go to hospital, no matter how long your stay lasts. With a Co-payment option, you agree to pay a daily sum up to a pre-agreed amount. For example, if Joanne has an Excess of $250 on her medical coverage policy and is admitted to hospital, regardless of how long her stay turns out to be, she will pay $250 of the final bill. If Andrew has signed a $75×4 Co-payment with his provider, he will pay $75 per day for just the first the first four days of his hospitalization.

For younger individuals who are healthy and fit with no reason to expect to land in hospital any time soon, either of these options are great ways to reduce the monthly cost of your medical insurance premiums.
Keep in mind that different private insurers have their own rules when it comes to Excess and Co-payments, including how many payments you will need to make annually on either option. It is important to read the policy thoroughly and ask questions in advance in order to have a clear understanding of what you are paying for, and what you can expect coverage-wise in the event that you are hospitalized. Also, make sure you choose an Excess option greater than $500 if you’re purchasing an individual policy, or $1,000 for family coverage, in order to be exempted from the Medicare Levy Surcharge.

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