Why Pay for Health Insurance Extras for Remaining Months of The Year When Extra Limits Are All Used up?

welcomeUniverseWorld on 18/01/2025 - 09:55
Last edited 18/01/2025 - 10:49 by 2 other users

What if I take health insurance with some extras, use up all the limits for those extras, and then cancel the extras for the remainder of the year while keeping only the hospital cover?

In January, I could switch to a new health insurance provider with extras, especially since many advertisements promote waiving two- and six-month waiting periods. Why pay for extras for the rest of the year after using up the limits, when switching to another provider next year could potentially reset those limits and waive waiting periods saving costs?

What do you guys think?

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Comments

  • AustriaBargain on 18/01/2025 - 10:02
    +9

    Wouldn't that reset your waiting periods? Why would a new provider waive the limits if you've cancelled it for months.

    • welcomeUniverseWorld on 18/01/2025 - 10:06
      -4

      However, many have advert saying "2&6 Month Wait Periods Waived"… Does that not mean when I get the extra again, the wait periods for those are waved and it no longer matters whether I had it cancelled for months?

      • AustriaBargain on 18/01/2025 - 10:07

        Which offer/provider did you have in mind?

        • welcomeUniverseWorld on 18/01/2025 - 10:10
          -4

          None at the moment. I will soon be switching from Medibank to another provider. However, I have already used up most of the extras available under my current Medibank plan. With a few surgeries lined up, I expect all extras to be fully utilized soon.

          Why continue paying for extras for the rest of the year? Even if I don’t switch providers, could I not switch to hospital cover only for the remainder of the year and reconsider extras next year? The money saved by not paying for extras for the rest of the year could add up to a significant amount.

          • YesPleaseThankYou on 18/01/2025 - 10:57
            +1

            @welcomeUniverseWorld:

            With a few surgeries lined up, I expect all extras to be fully utilized soon.

            Surgeries come from your hospital cover, not general treatments (extras).

            The money saved by not paying for extras for the rest of the year could add up to a significant amount.

            Do the math and let us know.

          • YesPleaseThankYou on 18/01/2025 - 10:59
            +2

            @welcomeUniverseWorld: For someone who apparently has:

            a few surgeries lined up

            It seems to me that you should be making your life less, not more, complex.

      • freefall101 on 18/01/2025 - 14:40
        +3

        The 12 month waiting period ones are usually the most expensive ones, you'd lose those.

      • HeWhoKnows on 19/01/2025 - 20:33
        +1

        Need to check the conditions of the offer

  • HardQuiz on 18/01/2025 - 10:09

    @easternculture knows the answer.

  • BigBirdy on 18/01/2025 - 10:21
    -2

    Kind of makes sense. Also, instead of canceling, you could switch your extras to a different provider. I assume that’d give you a fresh line of extras credit to consume, if required, and means no issue with waiting periods.

    • darkkito on 18/01/2025 - 11:30

      i believe healthfunds actually talk to each other, so when you use say an optical benefit when your switching over they will actually carry that status of used over. This may not be all cases but i know it is for some.

      • YesPleaseThankYou on 18/01/2025 - 11:34

        Yes, they do talk to each other, they have an industry group where they gossip about annoying health fund members: https://privatehealthcareaustralia.org.au/

        The above aside, by law, health insurers are required to provide you with a Transfer Certificate. The Transfer Certificate includes summary information about your membership history and claims. This information will be used by your new fund.

        Regardless, switching to a new fund where those limits have been reset, will give you a new set of extras limits to use.

  • star-ggg on 18/01/2025 - 10:25

    The extras plan packages get progressively worse with time. Lower limits and/or less coverage. If you kept cutting and going on new plans over the last 10 years you would have a worse plan now than what you had 10 years ago.

    • YesPleaseThankYou on 18/01/2025 - 10:55

      The extras plan packages get progressively worse with time. Lower limits and/or less coverage. If you kept cutting and going on new plans over the last 10 years you would have a worse plan now than what you had 10 years ago.

      Citation needed for your claim— do you have one? Do you work for a health fund?

      I ask because the claim you are making is often used by health funds as a 'save' retention tactic.

      Moving to new plans (churning) would have saved much more than staying on those old plans.

      • star-ggg on 18/01/2025 - 11:55

        I don't work for a health fund but I've held extras cover for 5years+. I max out my claims every year and have researched churning like others on here. The new plan limits are like half of what I had on my 5 year old plan. It never made sense for me to churn or if I did the amount saved would be so small it's not worth the effort.

        • YesPleaseThankYou on 18/01/2025 - 12:01

          the amount saved would be so small it's not worth the effort.

          Churning through the 'pay 1 month get 6 weeks free' nets a premium saving of approximately 58%.

          There is just no way that the extras limits you would have maxed out have saved you more than you would have by churning.

          • star-ggg on 18/01/2025 - 13:09

            @YesPleaseThankYou: The limits for the services I claim for are literally half now and gap payments have increased.

            • YesPleaseThankYou on 18/01/2025 - 13:29

              @star-ggg: I haven't even factored in the resetting of limits that you would benefit from by switching to insurers with different extras reset dates (1 January, 1 July, Anniversary Date).

              I think you need to check your maths.

              • star-ggg on 18/01/2025 - 14:13

                @YesPleaseThankYou: Just checked. At my non-profit provider the current extras plan has $1000 COMBINED limit which covers nearly everything. My current plan has $800 limit for physio alone. So yeah compared to when I last checked over a year ago the plans are definitely getting worse.

                • YesPleaseThankYou on 18/01/2025 - 14:15

                  @star-ggg: I'm sorry, but what you have stated is hardly a proper analysis.

                  I'll reiterate, if you're staying with your current fund because of higher extras limits on your older policy, you are ripping yourself off.

                  Have a great day!

                  • star-ggg on 18/01/2025 - 14:22

                    @YesPleaseThankYou: Fair enough. I'm currently claiming $1000 more than the cost of the extra cover and I doubt I'm going to end up with rich profits from churning health insurance policies.

                    • YesPleaseThankYou on 18/01/2025 - 14:46

                      @star-ggg: Noted - yes, I also claim back in extras more than I pay for premiums in Hospital and Extras combined (well, that's mostly true, depending on what's going on).

                      I acknowledge that churning isn't for everyone and does take a bit of time. However, once you learn the rules of the system, it can reap savings and rewards.

                      If you churned following the promotional offers, in your case, you'd pay lower premiums (much less than by not churning) and you would have the added benefit of extras limit resets by moving to funds with different limit reset dates, allowing you to claim even more (if you needed to).

                      The above would certainly result in benefits, but perhaps not 'rich profits', I agree :)

  • boomramada on 18/01/2025 - 10:27
    +2

    then you got no ambulance cover for the reminder of the year.

    • original15 on 18/01/2025 - 10:31

      Might have separate ambulance cover eg ambulance vic $110 a yr for family

    • BigBirdy on 18/01/2025 - 10:46

      Depends which state you’re in. Here in Qld the state govt covers ambulance

      • boomramada on 18/01/2025 - 10:53

        True but your state govt doesn't cover when you travel elsewhere ie SA/TAS/WA/NT/NSW/ACT or myself travelling to QLD will it? :)

        • YesPleaseThankYou on 18/01/2025 - 10:55
          -2

          You could Google your answer in 2 seconds.

        • Brigadier667 on 18/01/2025 - 12:29
          +2

          The Qld government picks up the tab for Queensland residents (and their dependants) anywhere in Australia. Interstate (and overseas) visitors needing an ambulance in Qld are invoiced.

          Evidence is typically a Qld driver licence.

    • welcomeUniverseWorld on 18/01/2025 - 11:27

      hmm Did not think about that, I do need that

      • YesPleaseThankYou on 18/01/2025 - 16:11
        +1

        Ambulance will be included in Hospital Cover, check the Private Health Information Statement (PHIS) for your policy.

  • YesPleaseThankYou on 18/01/2025 - 10:52

    Alternatively, you could switch to a fund that resets limits on anniversary (on joining) and reset your limits immediately. There are a few that do this.

    Then, come 1 July, switch to a fund that resets limits at that time.

    • andylch on 19/01/2025 - 00:46

      Which fund can do this? You can PM me, thank you so much :)

      • YesPleaseThankYou on 19/01/2025 - 09:38
        -2

        Yes, I can PM you, but I won't

        There's no secret about the dates. Use Google.

  • Nucleus Acumbens on 18/01/2025 - 21:00
    -1

    Any annual limits you use with one PHI, carry over to the second PHI.

    Only way to game the PHI system is to change insurer before April 1 and pay full years fees in advance. This way, you pay fees based on last years prices as opposed to the new ones that come into affect for the current year after April 1.

    • YesPleaseThankYou on 18/01/2025 - 21:10

      Any annual limits you use with one PHI, carry over to the second PHI.

      Correct, but funds reset them at different times:

      • 1 January
      • 1 July
      • Anniversary Date (Date of joining)

      Join a fund with a different reset date to yours and you can claim extras again.

      Only way to game the PHI system is to change insurer before April 1 and pay full years fees in advance. This way, you pay fees based on last years prices as opposed to the new ones that come into affect for the current year after April 1.

      Wrong. Anyone who pays their private health insurance 1 year in advance is a fool.

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