As over 40%* of Australians prepare to receive an average increase of 2.9% to their health insurance premiums on 1 October, new analysis from Compare Club has revealed that health fund members are missing out on hundreds of dollars worth of rebates on dental treatments due to older policies failing to keep pace with the cost of living.
Many people get a fixed amount of money back on dental treatment, but this amount doesn't rise with inflation, meaning people who took out a policy with a set benefit amount are receiving substantially less back from their health fund than new customers. For example one 'grandfathered' policy gives $60 back for a root canal compared with $105 for customers on a newer policy with the same insurer.
It is estimated there are 83,000 hospitalisations each year from preventable dental conditions and many Australians are putting off going to the dentist due to the high cost of treatment and the rising cost of living.
Looking at a range of older health insurance policies** and comparing them to their current day counterparts, shows that benefits on dental are frozen in time, while newer policies offer higher returns.
In some cases, customers with the same health fund and same level of cover, are getting up to a 50% lower rebate when the policy is up to 10 years old and closed to new members.
Medibank Private Limited
Special Extras Older policy, closed to new members $94.40 per month
My Choice Extras Move 60 Current offer, available to new members $97.50 per month
Periodic oral examination rebate: $16
Periodic oral examination rebate: $23.50
Scale & clean: $28
Scale & clean: $46.00
Fluoride treatment: $15
Fluoride treatment: $14.20
Surgical tooth extraction: $48
Surgical tooth extraction: $113.70
Full crown veneered: $428
Full crown veneered: $500
Filling of one root canal: $60
Filling of one root canal: $105.30
HBF Health Limited
Saver Extras Older policy, closed to new members $77.30 per month
Flex 50 Current offer, available to new members $95.50 per month
Periodic oral examination: $37.50
Periodic oral examination: 50% of charge
Scale & clean: $73.50
Scale & clean: 50% of charge
Fluoride treatment: $18.75
Fluoride treatment: 50% of charge
Surgical tooth extraction: $81.00
Surgical tooth extraction: 50% of charge
Full crown veneered: $495.00
Full crown veneered: 50% of charge
Filling of one root canal: $80.00
Filling of one root canal: 50% of charge
**Percentages are priced against the current item numbers for dental treatments available on https://www.health.gov.au/
“Many Australians are putting off or canceling their dental appointments because of the cost of living crisis and some, as a result, have become seriously ill. Dental cover can help with this but many people are missing out on hundreds of dollars worth of savings by not reviewing their health insurance policy”, said Compare Club Head of Research, Kate Browne.
“It’s vital if you have health insurance that you review it regularly - it’s astonishing to see that people can be with the same provider yet older, loyal customers are getting half the value back because they are on old and out of date policies.”
“Private health insurance, especially for dental and optical treatments which aren’t generally covered by Medicare, are vital for our health and wellbeing. Seeing a dentist isn’t optional so make sure you can get on the best value extras policy to take the sting out of the cost.”
“As more private health insurers are set to raise their premiums on the 1st of October, use this as a reminder that reviewing your health insurance is easy and can save you hundreds of dollars in value and costs.”
“Loyalty doesn’t pay and our research shows that even within the same health fund new customers are receiving far better deals than long term and loyal customers.”
Since 2018 anybody who hasn’t reviewed their policy could be paying hundreds of dollars unnecessarily. This is how much premiums have gone up by, on average per year:
Single parent families: $504
Top tips for finding value for money on health insurance policies
As every cent counts in the cost of living, don’t just rely on price. Really get smart with how you review your policy:
Extras are a great way to make savings, especially if you’re a large family. Getting higher annual limits or more back from a trip to the dentist or physio, or being able to claim back more on glasses and contact lenses could put more back in your pocket, even if your premium goes up by a few dollars.
Be ruthless and Marie Kondo your cover. If you’re paying for an item you’ll never use, like Gold cover that includes pregnancy, or excellent benefits back on remedial massages, look to see if you can ‘trade down’ to a cheaper policy that still covers everything you need. You also won’t have to serve waiting periods.
Look for extras cover that is percentage based rather than based on a dollar figure. Percentage based cover means that you don’t lose value as inflation and as the cost of these treatments rises the amount you get back will rise too. Funds such as NIB, AHM, and Bupa all offer covers with percentages back - either with their own providers or in some cases with any provider, so it’s worthwhile asking about these options.”
One tactic is to move to funds who’ve already put up their prices. That way you’re coming like with like.
There's an average saving of $385 to be made on health insurance policies by adjusting your extras. We know families are far more likely than any other demographic to request items like major dental treatments, chiro & osteo, and physiotherapy on their cover, so being smart with benefits and annual limits can unlock real value.
NOTES TO EDITORS
*Insurers who increased their premiums on Oct 1 include: Bupa, NIB, Teachers Health, Defence Health, and Navy Health, which make up 41.4% of market share. GMHBA and Frank raised premiums on 30 September
** All policies assessed cover two adults & dependants (3 or more people, only 2 of whom are adults)
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