In late 2017 the Health Minister announced a number of wide ranging private health insurance (PHI) reforms that come into effect in 2019. These reforms will focus on improving affordability and reducing the complexity of private health insurance products. They centre around making private health insurance easier to understand and encouraging younger people to consider taking it out.

Laura Geitz took the time to explain what they're all about...

During September and October 2018 the Government finalised the legislation and rules that govern these changes. With the finalisation of these reforms we now have an understanding of exactly what the upcoming changes are and how they will affect our Members. We’ve put together a table which provides a brief update on some of the key changes Members can expect to see as a result of the reforms.

Will there be any changes to my cover?

Throughout this process our main focus has always been our Members and we have been determined to keep any changes to products to a minimum for existing Members.

The majority of our Members will not be impacted however unfortunately there will be some small changes for some Members as a result of these reforms. There are also a number of positive changes to products as well. There will be a mixture of changes to hospital products as a result of the new clinical categories. These changes will be communicated to Members at the same time as our premium rate notifications in February 2019. Please keep an eye out for these notifications and contact our team if you have any questions.


There will also be some required changes made to our extras products with the removal of natural therapies, however the introduction of Chinese Medicine into some of our extras products will be a great addition. We will also be increasing our dental benefits for a scale and clean for all Members.

 

Reform

Proposed changes 

from 1 April 2019

How will this affect me?

Product Tiers

a new system for categorising hospital products

This reform will aim to classify products into four tiers - Gold, Silver, Bronze and Basic. The Government will set the minimum requirements for each tier. This will make comparing products a little easier. Your product tier will now be included in the name of your product.

You will be advised of the category your policy will fall into in your premium rate notification in February.

Standard Clinical Categories

This reform will ensure health insurers are using the same standard clinical definitions and categories. This will make it easier for consumers to understand their cover and compare different types of cover. There are 38 standard categories and these make up the minimum requirements for each of the tiers above.

We are currently reviewing the finer details of this reform
and will advise you in your premium rate notification in February if there are any changes to your product. Most Members will not see
any changes to their hospital product / policy however a small number of Members will
see some.

Discounts for Young People

This reform will allow insurers to provide people aged between 18 and 29 years with a discount on their private health insurance hospital cover. The discount will range between 2% and 10% and may be retained until they reach 40 years of age. It will then be gradually phased out by the age of 45.  

We have reviewed this reform and will offer aged-based discounts to Members. More details on this reform will be
advised at a later date.

Travel and Accommodation benefits for rural and remote Australians

This reform allows insurers to offer travel and accommodation benefits within hospital products. It aims to improve the value of private health insurance for those that live in regional and rural Australia. 

We are pleased to
announce that we will offer accommodation benefits to Members. More information will be advised at a later date.

Increasing the excess

This reform enables insurers to offer consumers a higher excess amount in order to lower their premiums. This centres around the main issue of affordability.

The current maximum excess is $500 for singles and $1,000 for couples/families. This reform increases the maximum allowable excess will increase to $750 for singles and $1,500 for couples/families. 

We are pleased to announce a new product will offer an increased excess. More details
on this reform will be advised at a later date.

Removal of Natural Therapies

This reform will require insurers to remove natural
therapies from 1 April 2019.

The following therapies will be removed from our
benefits list including from Healthy Living benefits
(where applicable):
• Bowen therapy
• Homeopathy
• Naturopathy
• Pilates
• Yoga

The following therapies will remain eligible for benefits
on covers where a benefit entitlement already exists:
• Remedial massage
• Acupuncture

Chinese Medicine will be added to our list of benefits
available after 1 April 2019 on some products.

All extras products will be
affected by this reform. Each product will be affected in a slightly different way. You will be advised in your
premium rate notification in February.

For more information on the reforms please visit The Department of Health website