HIF Continues the Fight to Keep Health Cover Premiums Down For Our Members

HIF News

For the fifth consecutive year, Health Insurance Fund of Australia (HIF) is maintaining its stand against the big health funds by keeping premiums down for its 60,000 members.

Once again, members of one of Australia’s fastest growing health funds will be relieved to know that HIF’s premiums will only have to increase by an average of 4.47 percent from 1 April – well below the industry average of 5.57 percent and once again, below the big funds, including ‘for profit’ funds NIB at 6.19 percent, Medibank Private  at 5.35 percent and BUPA at 5.14 percent as well as below HCF at 6.41 percent and HBF at 5.85 percent.

HIF is committed to keeping its members’ health insurance premiums affordable, despite benefits rising by 17 percent in the 12 months to December 2010.

Graeme Gibson, Managing Director of HIF calls on the big health funds to justify their rate rises to their members:

“Rising health care costs are a fact of life yet HIF has been able to push its average premium increase down to below five percent for the fifth consecutive year without compromising on benefits, service, choice and value for members, so why can’t the big health funds?” Graeme said.

He also believes that the big funds are not doing enough for their members. 

“Why don’t the big funds pass efficiency savings (because of their size and scale) back to their members in the form of lower average premium increases?” Graeme asked.

“Profits and shareholder dividends should not come at the expense of members being forced to dig deeper to pay higher premiums than is necessary.”

Graeme suggests most health funds increase premiums to cover the growing cost of hospitalisation, medical treatment, pharmaceutical costs and improved medical technology.  And unlike HIF, some health funds take more from their members to pay dividends and potentially mask inefficiencies in ‘big fund’ bureaucracy.

“Cost increases are ultimately passed on by health funds to their members, but not all health funds increase premiums by the same amount,” he said.

“As a not-for-profit health fund, HIF aims to keep premium increases as low as possible and because HIF doesn’t have shareholders, any surpluses are returned to their members through lower premium increases, increased benefits and better customer service.”

As a result of keeping its average premium increases the lowest in WA and below the national average for five years in a row, HIF has experienced record membership growth of 14.3 percent in the 2010 financial year and is now one of the ‘top 5’ fastest growing  not-for-profit health funds in Australia.  There are 35 Australian registered health funds.

“Australians are fast realising that HIF is the smart choice for health cover, with many switching health funds in the past 12 months - we believe this membership surge is a result of people leaving the big health funds due to higher increases in their health insurance premiums,” Graeme said.

HIF’s average increase means that after the Federal Government 30% rebate, single members with hospital cover will only pay between $0.59-$1.12 extra per week, singles with ancillary cover will pay between $0.21-$0.57 extra per week, and singles with hospital and ancillary cover will pay between $0.80-$1.69 extra per week.

Finally, Graeme suggests HIF members can avoid most, if not all of the 2011 increase by paying a full 12 months premiums up front, because HIF will give members a 4% discount for annual payments.

Media contacts: Helen Andrews – 08 9227 4229.

Table 1: Comparison table of premium rate rises since 2007:

Premium Increases 2011 2010 2009 2008 2007
4.47% 4.50% 4.98% 3.51% 3.89%
Medibank Private 5.35% 5.74% 5.74% 4.64% 4.92%
HBF 5.85% 4.95% 7.95% 3.90% 4.30%
NIB 6.19% 5.95% 5.18% 4.99% 4.65%
Industry average 5.57% 5.78% 6.02% 4.80% 4.52%

Table 2: Examples of HIF's premium increases:

Type of Service
(single policy)
Weekly Premium* 
Before 1 April 2011
Weekly Premium* 
After 1 April 2011
Weekly Increase*
After 1 April 2011
Top hospital cover
(no excess)
$23.84 $24.96  $1.12
Budget hospital cover
($200 excess)
$8.47 $9.06 $0.59 
Top ancillary cover $11.90  $12.46  $0.57 
Budget ancillary cover  $3.50 $0.21 $0.21 
Top hospital cover (no excess) + ancillary cover $35.73 $37.42 $1.69 
Budget hospital ($200 excess)
+ ancillary cover
$11.97 $12.77 $0.80 

* Price includes the 30% Federal Government Rebate on Private Health Insurance.

Category: HIF News

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