 |
| (Image credit: Getty Images via @daylife) |
Looking for a way to balance your budget and save money on your health insurance cover? The cost of health care is increasing every year and a lot of people do not know about all the options available for saving money when it comes to their health care. To start the ball rolling, there are several things that you are required to do, and specific information you need to be aware of. Taking the right action will help to make sure that you and your family will get the right benefits and payments.
Some of the benefits of having private health cover include:
- You have the ability to be treated by the doctor of your choice.
- You can expect less time waiting for elective surgery.
- You will be in control of when your treatment takes place and where.
- Government funds are freed up as the strain on the public hospital system is lessened and hospitals can be upgraded
- You can have access to services that are not listed under the Medicare system like alternative therapies, chiropractic, and dietary advice to name a few.
There is a good deal of federal government initiatives all set up to encourage more people to take out private health insurance. In short, these can help you to bring down the costs of your private health insurance. What's more, in certain circumstances, if you choose not to take out hospital cover, you may be required to pay an additional surcharge during tax time. Government initiatives you may qualify for include:
1. Receiving a 30 percent Private Health Insurance Rebate (source – Businessweek)
2. Lifetime Health Cover
3. Medicare Levy Surcharge
Why the 30 Percent Rebate Saves You Money
Now a lot of people consider private health insurance as something only the wealthy can afford, with the 30 percent rebate in place, more people are finding it affordable. Although premiums do rise because of inflation and other factors, the 30 percent rebate has made cover so much more affordable. The premiums for private health funds vary based on the actual cost of health care and the kind of cover you need.
How the Medicare Levy Surcharge Works
The Medicare levy is 1.5 percent of a taxpayer’s income and is used to fund the Medicare System. It is assessed to taxpayers who are without private hospital cover and fall into a certain income bracket. The Medicare levy surcharge is 1 percent of taxable income and imposed on singles, couples, and families whose income exceeds the threshold and who don’t have the right amount of hospital insurance.
The easiest way to save money and avoid the surcharge altogether is to have a hospital cover policy that has been approved. This hospital cover policy must be set up through a health insurer that is legally registered with $500 or less per year for single polices or $1,000 per year for couples and families, or just a low front-end deductible.
The Purpose of Lifetime Health Cover
Lifetime Health Cover applies to all residents born after 1 July 1934, and while not all funds offer such policies, you are likely to find one suitable for you. It sets your premium rating for life when you first take out private health insurance hospital cover. The sooner you take out hospital cover the better. If you do not have hospital cover by the 1st of July after your 31st birthday and instead wait to take out hospital cover later on in life, you will pay a 2% loading on top of your premium for every year you are aged over 30. After loading Lifetime Health Cover onto your private hospital insurance continually for 10 years, the loading will be removed as long as you keep your hospital cover.
This is a guest post by financial writer Paul Groberts.
