Is it worth it ? If so, which fund should I go with ?
A common question for me and there are many things to consider.
Generally if you know you use physiotherapy regularly, then extra's cover may be the way forward.
Especially if you don't qualify for other Funding Sources - Medicare, NDIS, Aged Care, etc.
But which fund ? Do your research at privatehealth.gov.au.
I do have several clients who kept records for 12 months on their out of pocket expenses VS their private health insurance expenses. Both individuals swore that simply paying for their health expenses as they arose was cheaper. Both individuals set up a separate "health" account and had their regular private health insurance expenses paid into this account, rather than to an insurer, so they would always have funds allocated for health needs. Both said this "health" account was growing over time - which means they are ahead financially doing things this way. A strategy worth considering and fairly easy to set up.
Or you can follow the Barefoot Investor's Advice from his most recent newsletter. With a brand name like that - I can't help but love everything he writes.
Hi Movement Solutions,
I opened my mail, and felt a cold stethoscope to my nether regions:
My health fund was giving me a tickle. It happens every year. Over the past decade consumer prices have grown 20% … but health insurers have jacked up their premiums by 54%.
Oh, that’s cold!
If you pay for private health insurance you know that around this time each year your fund sends you out their ‘drop your dacks and hold your acorns’ letter. Spoiler alert: next week they’re going to jack up your annual premiums – with some funds hiking by as much as 5%!
So let’s talk about what you can do about it.
First, if you can afford it, most funds allow you to pre-pay your premium and lock in the old rate.
Yet let’s be honest: health insurance is bloody expensive, so it’s worth your while to spend an hour or so checking to see if you’re getting the best deal … or if you even need it (if you’re under the age of 31, or you’re earning under $90,000 a year as an individual or $180,000 as a family, you may not need it).
So here’s what I do for my family:
First, I purchase top-level comprehensive private hospital insurance.
Second, I don’t purchase extras or combined healthcare cover. Reason being, most extras policies cost you hundreds of bucks extra per year … whether you claim or not. Don’t believe me? Ring your fund and request an annual claim statement. Then ask, “If I switched to a comparable hospital-only policy, how much would I save each year?”
Third, I do my research on privatehealth.gov.au. That’s the government website and it’s weirdly good. It allows you to compare your current policy against others. Most importantly, it compares every fund on offer – unlike those comparison sites (like iSelect and Comparethemarket) which only list funds that pay kickbacks.
So this week it’s time to turn the tables on your fund, and get them to bend over and show you how flexible they really are.
Tread Your Own Path!
Either way - do not be shy to invest in your health. You have one body for life and you can't trade it in. When I think what I spend on my car each year, I think my body deserves equal attention.