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How to find the best health insurance for you in Australia

6min read

Author: Compare Club


We know you’ve probably landed on this page because you’re looking for the best health insurance in Australia. So let’s start by saying there’s no such thing as a “best” health insurance policy – it’s all relative to the individual. But when you’re considering what’s best for you, there’s lots of questions you can ask to hone in on a policy that’s both suitable for you – and your family – and your household budget.

Comparing health providers is quick, easy and one of the best ways to find cover that’s right for you. This guide will run through everything you need to know to get a good deal.

Key Points

  • Private health cover can provide benefits such as access to private rooms, your choice of doctor, shorter wait times for treatments, money back on healthcare extras like dental and physio consults, and more.

  • The cost of private health cover depends on a range of individual factors, such as your age, location, and specific health needs.

  • With appropriate private health cover, you can avoid paying the Medicare Levy Surcharge (MLS).

What is private health insurance?

While Australians are lucky to live in a country where we have a solid public healthcare system, it doesn’t always meet your specific needs. Getting private health insurance is a way to get covered for exactly what you need. Private cover is generally split into two different types: hospital cover and general treatment outside of hospital (this is usually called ‘extras’) cover.

In exchange for taking out a policy and paying regular premiums, you’ll receive a number of benefits including:

  • Affordable access to private hospital rooms.

  • Shorter wait times on elective surgeries.

  • Freedom to choose your preferred doctor or surgeon.

  • The ability to claim back money from non-Medicare services such as dental check-ups and physio sessions.

  • Exemption from the Medicare Levy Surcharge (MLS). Find out more about the tax benefits of private health cover here.

Why is Medicare and the public system not enough?

Medicare and the public health system allow every Australian to access quality care when they need it most, but there are some areas where Medicare doesn’t work so well. There are a lot of healthcare expenses that are not covered under Medicare, like dental care, which is why private insurance can help you avoid a hefty bill after treatment.

How much does private health insurance cost?

There’s no one-size-fits-all solution for private health insurance. You may choose to take out hospital cover as a single or a couple, but not extras. Or a family might want to take out a high level of hospital plus extras for both parents and their children. This all affects how much you pay in premiums.

Your age, life stage, where you live around Australia, the hospital cover tier you choose, how many people are on your policy, and what extras you want, will also affect the price of your private health insurance policy.

According to our data, this is the average monthly amount somebody could expect to pay on a singles policy in 2023:

Age RangeAverage Premiums per Month
Under 36 years old$171
36-59 years old$201
60+ years old$224
Source: Over 10,000 Compare Club policies, sourced 2022-2023.

Which is the best health insurance policy?

The truth is that there is no universal ‘best’ health insurance policy for everyone — it’s relative according to your age, your current health and your life stage. But you can use all of that information to compare various policies and get a good sense of which private health provider is the best fit for you.

At Compare Club, we help you find the best policy for your situation from our panel of Australian insurers, and you can start comparing and switching today.

How do you choose the best private health insurance?

It can be quite a time consuming process to research all the available health funds and policies. You might need a large spreadsheet to keep track of everything that’s important to you and the differences between premiums and inclusions. Compare Club can help in this area. We compare some of Australia’s biggest funds and our expert team know where your hidden savings are.

Over the last 5 years, we’ve saved our customers an average of $300* off their annual health insurance cost when they switched policies through us.

Our team have answered the most commonly asked questions they get from customers below:

How do you find the best private health insurance for families, seniors and individuals?

The first thing to do is write down a list of what you want to get out of your private health cover. Many families want extras cover as it helps reduce the cost of common procedures for children, such as dental checkups. Plus, if you’re planning to start a family in the next year or two, you may want to take out a higher level of cover for your partner before she’s pregnant.

A single person with no health issues might just want to avoid the Medicare Levy Surcharge, so a Basic hospital cover policy could be for them. For older Australians, private health cover with extras can mitigate the cost of expensive procedures that become more common as you age, such as hip replacements or eye surgery. And when it comes to extras, some private health funds will offer a better deal on claiming back certain expenses, such as no-gap dental check-ups.

This may be a deciding factor in you choosing one provider over another. It’s also worth looking at the maximum amount you can claim back on your extras. If you’re always hitting your limits after a few months, or never get close to reaching them, there’s a good chance you’re on the wrong policy.

Here’s a few questions to ask when you’re comparing health cover policies:

  • How much will you get back in benefits on your extras?

  • What are the annual limits on the extras that are important to you?

  • Does your fund have a no-gap scheme?

  • Will you have to wait to serve new waiting periods before you can claim back on your policy?

  • Is the policy stuffed full of items that you’ll never claim on?

  • Does your fund have an agreement with your local hospital or family dentist? This is especially important if you’re in a regional or rural part of the country.

How do you find the best health insurance for saving on the Medicare Levy Surcharge?

The Medicare Levy Surcharge (MLS) is designed to help reduce pressure on the public health system and taxes a portion of your income once you earn over a certain amount if you choose not to take out an appropriate health cover policy.

Most basic hospital cover policies will cover the MLS but very little else. Some won’t even come with Ambulance Cover, which is why it pays to compare.

In terms of how the MLS works, Australians who earn more than $93,000 annually (or $186,000 as a family) will have to pay a surcharge of between 1% and 1.5% unless they take out private hospital cover.

Here is how the surcharge is calculated according to income:

ThresholdBase TierTier 1Tier 2Tier 3
Single threshold$93,000 or less$93,001 – $108,000$108,001 – $144,000$144,001 or more
Family threshold$186,000 or less$186,001 – $216,000$216,001 – $288,000$288,001 or more
Medicare levy surcharge0%1%1.25%1.5%

You need to make sure the private insurance you take out is through a registered Australian insurer. Be aware that taking out extras cover or ambulance-only cover without hospital cover will mean you are not exempt from the MLS.

Now that you’ve got an idea of what you need, speak to the experts at Compare Club. We can match the policies on our panel to your needs to make sure you’re on cover that suits you at a price that won’t break the bank.

This article is opinion only and should not be taken as medical or financial advice. Check with a financial professional before making any decisions.

**Based on 136,746 customers between 1 Jan 2018 – 23 December 2022.

Private Health Ombudsman, Medicare Levy Surcharge

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