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Private Health Insurance Reforms

Private Health Insurance can be an enigma for many Australians. With almost 40 different insurers to choose from, each with their own pros and cons, it’s progressively become more difficult to navigate this ever changing industry.

The recent Private Health Insurance Reforms, undertaken by the Australian government, were announced mid-October and will come into effect over the next two years. They aim to make private health insurance simpler and more affordable, but many people are still unsure what these changes mean.

Read more about the key areas involved in the reform here, and how it might affect you.

  • Private health insurance will no longer cover ‘natural therapies’ including aromatherapy, Bowen Therapy, Herbalism, Homeopathy, Naturopathy, Pilates, Tai Chi and Yoga (amongst others). Unsurprisingly, we’ve received many questions on this topic due to our wide range of clinical exercise services, including Pilates and Yoga! Fortunately, this change will not affect any Move patients, as everyone who instructs Pilates or Yoga classes here is a qualified and certified allied health professional.
    When you claim for a Pilates or Yoga class, the benefits paid out by Private Health Insurers are based on who has provided the service to you. If this is a Physio, then the claim goes under your Physiotherapy Extras Cover. Even if you attend a Pilates or Yoga class, the fact that it’s run by a Physio means the health insurers recognise that you’re undertaking clinical exercise, provided by an allied health professional.
  • There will be a new system of categorising health insurance products. From 2019, there will be four categories of hospital products (Gold, Silver, Bronze and Basic) and three categories of extras (Gold, Silver and Bronze). There will be funding allocated to the development and introduction of these categories, as well as an expert committee put in place, to ultimately make health insurance easier to understand.
  • Easier access to mental health services. Those with limited mental health cover will be able to upgrade their insurance (without being stuck with a waiting period) to access in-hospital mental health services. This creates easier access to these services, and helps prevent out of pocket costs to patients.
  • A committee will be created on Addressing Low Value Care, and will give the government advice on further changes to prevent low value insurance or inefficient care. It will support future reforms to the industry, and will be developed over the coming years. There will also be a committee to help the government determine how to make out-of-pocket costs easier to understand.
  • Standardization of clinical definitions used in documentation used by private health insurers. Many Australians are happy to hear the Clinical Definitions Working Group has developed a list of standard definitions (that are meant to be “consumer-friendly” terms) to help consumers compare and understand different policies.
  • The Private Health Insurance Ombudsman can conduct audits on private health insurers, to ensure they are meeting these regulations. A number of operational changes within the Ombudsman also means they have a better website (privatehealth.gov.au), more staff, more access and more power to address consumer complaints.
  • Discounted private health insurance policies are able to be offered to people aged 18 – 29. While current legislation prevents companies from offering discounts based on age, this will soon change to allow young people discounts on hospital premiums for up to 2% for each year they are under 30 (capped at a 10% discount). This will be phased out after 40 years of age.
  • Consumers can choose higher excesses to lower their premiums. Previously, the maximum excess you could choose for your private hospital insurance was $500 for singles and $1000 for couples/families. From April 2019, this will change to $750 and $1500 respectively, and should contribute to reducing price increases.

Hopefully this gives you some more insight into these changes. If you’d like to read the full list of the private health insurance reforms, which includes further information on administrative changes, options for privately insured patients in public hospital, and changes to support private hospitals, click here.

Just keep in mind, all of this information is general and current as of November 2017. You’ll need to chat to your insurer directly for any specific queries or changes.

Please don’t hesitate to ask us at reception if you have any questions on this topic. Our staff try to stay up to date on any developments so we can help you if you need!

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