HCF has introduced a new product, Hospital Basic Plus, designed to provide more affordable hospital cover to young Australians.
The launch responds to findings from a recent YouGov survey, commissioned by HCF, which shows that 41% of Australians aged 25 to 39 currently lack health insurance, despite concerns about unexpected medical costs.
The survey found that 76% of Australians aged 25 and over believe that private health insurance is important, with 46% considering it very important.
Younger generations – specifically Gen Z and Millennials – are most likely to recognise the need for health insurance, with 86% saying it is essential for covering unforeseen medical expenses. This compares with 74% of Gen X and 68% of Baby Boomers who share that view.
Lorraine Thomas, HCF’s chief operating officer, pointed out the gap between understanding the importance of private health insurance and actually taking out coverage.
“Many understand the risks but feel priced out of the market. Hospital Basic Plus is designed to bridge this gap, offering an affordable solution that aligns with the needs and budgets of younger individuals,” she said.
Hospital Basic Plus offers affordable cover for key health services.
One of its main features, Accident Safeguard, allows policyholders access to HCF’s highest level of hospital cover for accident-related treatments for up to 90 days, without requiring an excess. The policy also includes coverage for procedures like joint reconstructions and gynaecological treatments.
Additionally, the product helps individuals avoid the Medicare Levy Surcharge (MLS) and the Lifetime Health Cover (LHC) loading, which can increase the cost of health insurance for those who delay taking out cover until after age 31.
The YouGov survey also revealed that 40% of Australians aged 25 and older have experienced a sudden illness or injury that required hospitalisation. Those earning less than $50,000 per year were the least likely to hold private health insurance but were the most likely to require significant medical treatment.
To offer further support, HCF is also allowing Hospital Basic Plus to be paired with its Flex My Extras product, which gives customers flexibility in choosing extras cover for services such as dental, physiotherapy, and optical care. This option is aimed at young singles and couples who want to customise their cover according to their individual needs.
The launch of Hospital Basic Plus comes at a time when Australian private health insurers are increasing benefits paid to their members.
Data from the Australian Prudential Regulation Authority (APRA) indicated that health funds paid more than $18 billion in benefits for hospital services in the 12 months ending June 2024, a 7.9% rise from the previous year. Extras benefits, including services like dental and optical, reached $6.3 billion.
Membership in private health insurance has also risen, with nearly 64,000 Australians taking out hospital cover and over 120,000 adding extras cover during the June 2024 quarter. The largest growth in membership was seen among Australians aged 30 to 34.
Matthew Koce, CEO of Members Health Fund Alliance (Members Health), commented on the growing trend in private health insurance uptake.
“The latest data is yet another indication of the enormous benefit and value which private health insurance delivers,” he said.
Members Health is calling for policy changes, suggesting that making private health insurance fringe benefits tax-exempt could further encourage uptake, reduce reliance on the public system, and help Australians cope with rising living costs.
