Why do private health insurance premiums go up on April 1st?
Every year in Australia, health insurance premiums increase to match wages and inflation. The COVID pandemic caused the health funds to scatter their annual rate rises between 2021-2023 and sometimes skip them altogether. 2024 is the first year since the pandemic that the annual health insurance price hike has returned to normal, with all health insurance companies going up on April 1st.
This year’s price increase will be 3.03%, the industry average, making it the steepest rise in premiums since the pandemic. Minister for Health and Aged Care Mark Butler MP suggests that although we last saw a hike like this in 2019 and before, it is still below Australia’s 4.1% wages and inflation rate.
However, the major Australian health insurers have been criticized harshly for the enormous premiums they received and stockpiled during the pandemic. Health funds retained billions of dollars in paid premiums while elective surgery was closed for business during systemic pandemic lockdowns. The ACCC has been actively on the back of health insurers, pushing for more significant refunds to paying members through deferred premiums, cash-back payments and rollover limits for extras.
Some other aggravators of increased health insurance premiums are rising costs of medical devices, health-fund IT upgrades (to avoid the sort of cyber-attacks we saw on Medibank recently), more people going to hospital for admissions, and inflation doing its work on the inherent cost to run a hospital – and those costs are being passed on to the insured.
The Short Version
Many Australians feel the sting of ongoing inflation heading into 2024 that doesn’t seem to be letting up. Increased private health insurance premiums is just another nail in the coffin for some household budgets.
The top 5 largest health insurers in membership size are all but one, increasing their average policy price by more than the industry standard of 3.03% in 2024. Medibank is increasing prices by 3.31%, BUPA by 3.61%, HCF by 2.89%, NIB by 4.10%, and HBF by 3.95%.
The health insurance companies with the lowest rate of rise this year are HCi, with only a 0.27% increase, Defence Health by 1.00%, Australian Unity by 1.42%, Peoplecare by 1.63%, and Health Partners by 1.93%. It is no surprise that all of these funds are mutual or not-for-profit health insurers.
People who compare their health insurance through a reputable comparison service like ours will likely decrease their health costs this year.
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Which health insurance companies went up the most in 2024?
The top 12 health insurers that increased their premiums the most this year are CBHS, NIB, HBF, HIF, Phoenix, BUPA, OneMediFund, Hunter Health, Medibank, and St Lukes.
| Health Insurance Company | 2024 | Health Insurance Company | 2024 |
|---|---|---|---|
| CBHS Corporate | 5.82% | BUPA | 3.61% |
| CBHS Health Fund | 4.51% | OneMediFund | 3.41% |
| NIB | 4.1% | Hunter Health | 3.32% |
| HBF | 3.95% | Medibank | 3.31% |
| HIF | 3.87% | St Lukes | 3.2% |
| Phoenix Health | 3.72% | ACA | 3.18% |
Industry Average is 3.03%
Which health insurers were above the industry standard rate rise in both 2023 and 2024?
The following health insurers have hiked their policy prices above the industry standard both last year and this year as well: CBHS, HBF, HIF, Phoenix, BUPA, Hunter Health, Medibank, ACA, and Navy Health.
| Health Insurance Company | Profit Type | 2023 | 2024 |
|---|---|---|---|
| CBHS Corporate Health Pty Ltd | For-profit | 5.38% | 5.82% |
| CBHS Health Fund Limited | Not-for-profit | 4.46% | 4.51% |
| HBF Health Limited | Not-for-profit | 4.49% | 3.95% |
| Health Insurance Fund of Australia Limited | Not-for-profit | 3.1% | 3.87% |
| Phoenix Health Fund Limited | Not-for-profit | 3.66% | 3.72% |
| BUPA HI Pty Ltd | For-profit | 3.39% | 3.61% |
| Hunter Health Insurance | Not-for-profit | 3.93% | 3.32% |
| Medibank Private Limited | For-profit | 2.96% | 3.31% |
| ACA Health Benefits Fund Limited | Not-for-profit | 3.92% | 3.18% |
| Navy Health Ltd | Not-for-profit | 2.94% | 3.1% |
Industry Average Rate Rise in 2023 was 2.90% and the Average in 2024 is 3.10%
Portability
Don’t re-serve waiting periods when you switch to a new health fund or policy
“John was immediately covered for a hip replacement in private hospital because he had already served his waiting periods for joint replacements on his old policy”
The Top 10 health funds that had the lowest rate rise in 2024
The health insurers with the least rate increase this year are HCI, Defence Health, Australian Unity, Peoplecare, Health Partners, TUH, Mildura Health, AIA Health, Queensland Country Health Fund, and Teachers/Nurses Health.
| Health Insurance Company | Profit Type | 2024 |
|---|---|---|
| Health Care Insurance Ltd | Not-for-profit | 0.27% |
| Defence Health Limited | Not-for-profit | 1.00% |
| Australian Unity Health Limited | For-profit | 1.42% |
| Peoplecare Health Limited | Not-for-profit | 1.63% |
| Health Partners Limited | Not-for-profit | 1.93% |
| Queensland Teachers' Union Health Fund Limited | Not-for-profit | 1.96% |
| Mildura District Hospital Fund Ltd | Not-for-profit | 2.14% |
| AIA Health Insurance | For-profit | 2.19% |
| Queensland Country Health Fund Ltd | For-profit | 2.53% |
| Teachers Federation Health Ltd | Not-for-profit | 2.65% |
Which health funds in Australia were below the industry standard health insurance rate rise in both 2023 and 2024?
These listed funds are recognized for keeping their price increase lower than average for last year and this year running. They are HCI (who actually decreased their prices last year!), Peoplecare, TUH, Mildura Health, AIA Health, Teachers/Nurses Health, Doctors Health Fund, Westfund, GMHBA/Frank, Police Health, and LaTrobe Health.
| Health Insurance Company | Profit Type | 2023 | 2024 |
|---|---|---|---|
| Health Care Insurance Ltd | Not-for-profit | -0.09% | 0.27% |
| Defence Health Limited | Not-for-profit | 3.48% | 1% |
| Australian Unity Health Limited | For-profit | 3.76% | 1.42% |
| Peoplecare Health Limited | Not-for-profit | 2.79% | 1.63% |
| Health Partners Limited | Not-for-profit | 2.93% | 1.93% |
| Queensland Teachers' Union Health Fund Limited | Not-for-profit | 0.81% | 1.96% |
| Mildura District Hospital Fund Ltd | Not-for-profit | 2.48% | 2.14% |
| AIA Health Insurance | For-profit | 1.69% | 2.19% |
| Queensland Country Health Fund Ltd | For-profit | 3.17% | 2.53% |
| Teachers Federation Health Ltd | Not-for-profit | 2.5% | 2.65% |
Here is the complete list for all health insurance rate rise increases for 2023 and 2024.
| Health Insurance Company | Profit Type | 2023 | 2024 |
|---|---|---|---|
| CBHS Corporate | For-profit | 5.38% | 5.82% |
| CBHS Health | Not-for-profit | 4.46% | 4.51% |
| NIB | For-profit | 2.72% | 4.1% |
| HBF | Not-for-profit | 4.49% | 3.95% |
| HIF | Not-for-profit | 3.1% | 3.87% |
| Phoenix Health | Not-for-profit | 3.66% | 3.72% |
| BUPA | For-profit | 3.39% | 3.61% |
| OneMediFund | For-profit | 2.86% | 3.41% |
| Hunter Health | Not-for-profit | 3.93% | 3.32% |
| Medibank/AHM | For-profit | 2.96% | 3.31% |
| St Lukes | Not-for-profit | 2.86% | 3.2% |
| ACA | Not-for-profit | 3.92% | 3.18% |
| Navy Health | Not-for-profit | 2.94% | 3.1% |
| Latrobe Health | Not-for-profit | 2.15% | 3.04% |
| Police Health | Not-for-profit | 0% | 3.01% |
| Reserve Bank Health Society | Not-for-profit | 3.18% | 2.97% |
| GMHBA/Frank | Not-for-profit | 2.33% | 2.91% |
| HCF | Not-for-profit | 3.33% | 2.89% |
| Westfund | Not-for-profit | 2.65% | 2.82% |
| Doctors' Health Fund | For-profit | 2.15% | 2.79% |
| Teachers Health/Nurses Health | Not-for-profit | 2.5% | 2.65% |
| Queensland Country Health Fund | For-profit | 3.17% | 2.53% |
| AIA Health | For-profit | 1.69% | 2.19% |
| Mildura Health Fund | Not-for-profit | 2.48% | 2.14% |
| TUH | Not-for-profit | 0.81% | 1.96% |
| Health Partners | Not-for-profit | 2.93% | 1.93% |
| Peoplecare\ | Not-for-profit | 2.79% | 1.63% |
| Australian Unity | For-profit | 3.76% | 1.42% |
| Defence Health | Not-for-profit | 3.48% | 1.00% |
| HCi | Not-for-profit | -0.09% | 0.27% |
| Industry Average | - | 2.9% | 3.03% |
Conclusion
Some health funds go up (much) more than others. A higher percentage premium increase does not indicate how much your policy will increase. For example, BUPA customers cannot simply add 3.61% to their current fortnightly, monthly or annual premium. These reported health fund increases are just fund averages across all of their policies. Policy A might only go up 1%, and Policy B might go up 5%. You’ll have to wait until you get a letter or email from your fund advising you of the damage.
Ultimately, a smart health insurance habit is to keep track of your annual comparisons to other products. Knowing how your policy compares to the rest of the evolving market is fundamentally important. We can help you review other health funds that suit your needs equally or better but at a lower price. Wouldn’t you want to pay less for a health insurance policy that pays more for the things you use most?
Doesn’t that sound like a no-brainer?
