Changes

Previously, the income at which you begin being penalised if you don't have health insurance was $50,000. Now, due to the Federal Government's budget, this starts at $100,000 for singles or $150,000 combined if you are a couple.
Premiums for private health have also gone up by 5%.
It is estimated up to one million Australians are preparing to dump their private health cover because they don't need it.

Nicole Pedersen-McKinnon from Smart Investor is worried that the changes will mean people will drop out of their fund, place more pressure on the public system.

Should you abandon your cover
Nicole says that choosing private health insurance to avoid the medicare levy surcharge risks forgetting the lifetime membership rules. It might seem like a quick fix to the family budget to abandon your cover but it will be more expensive if you want to get back in after your 31st birthday.

Choosing your fund

Shop around is Nicole’s best advice.
There are some funds that cover just 60% of out of pocket expenses while others covered over 90% .
Always be sure to check the inclusions and exclusions, to minimise paying for things you will never use.

Nicole has done research for 38 private health funds and found the best fund for different groups:
 
Best Cover for Singles:
 
- Manchester Unity
- NIB
- CDH
 
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Best Cover for Families:
 
- CDH
- Australian Health Management
- Manchester Unity
- St Lukes
 
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Best Cover for Couples:
 
- CDH
- St Lukes

More info
What’s your decision regarding private health funds?