Private Health

Reporter: James Thomas

When your private health premiums go up again soon, you'll probably sigh and accept it. Even though, for a family, the amount can be substantial. There are ways to save money, by acting now, through companies which claim their comparisons of health funds puts cash back in your pocket. However, that may not always be the case.

Katrina and Sean Blattman have their hands full with 4 kids. There's groceries, school fees, a mortgage and like 50% of the Australian population, Private Health insurance.

"Certainly with a growing family we think it is a necessity and it something we don't want to drop," said Sean.

That's how the government and insurance companies want you to feel according to financial commentator Peter Switzer.

"I think it is really hard to go out of the system. You've got tax incentives, rebates. There is this government demand that you be in the system as well," said Peter.

Which might be ok, if premiums didn't keep rising year after year

"It's needed to maintain the economic viability of the funds given the claims that are made on them," said former PM, John Howard.

During Howard's final years Private Health Insurance funds reported a surplus of 1.2 billion dollars in 2006. But then, hope came in the form of Kevin 07 and team labor. Before they were elected, labor assured us, he would pressure health funds to keep Premiums at Bay, but last week they lost that fight, with his health Minister announcing premiums would rise by roughly 5%

"This is an extraordinary overloading on families that are carrying large amounts of debt and seeing their expenses going through the roof," said Peter Swtitzer.

"I do think people take a bit of a breath every time it goes up and say... "how can i get the best deal out of this," said David Miller.

David Miller is the founder of comparison site "Money Time".

"So, we will take the products in this case health insurance and we open them up and lay it out side by side so people can see a little better what they are buying," he said.

By punching in where you live, your personal situation and what you want from your fund you can then compare health funds, what they offer and their prices.

"We have had cases where people are saving up to 40 or 50 dollars a month," he added.

Money time referred us to Sean and Katrina who attest to real savings.

Private Health Cont'd.

"The saving for us as a family was pretty close to $80 a month. Nearly a thousand bucks a year better off. Still including everything that we have. To maintain the level of cover that we need," they said.

I Select is another comparison website which offers consumers the opportunity to save on their Premiums.

"There can be savings of up to 30%," said Peter Switzer.

While savings can be made, Peter Switzer warns comparison sites fall short of being a comprehensive one stop shop.

"The thing is they are not looking at all the funds in the market and therefore you could be hoodwinked into believing that they are looking at the greatest range of funds and therefore you will find the best savings," he added.

...But, the cheapest fund in the market may not be listed on the comparison website.

"Do you have MBF Australia?" asked our reporter.

"No, we don't," replied David.

"Do you have Medibank Private?"

"No, we don't."

"Ok, that's close to 50% of the market. Does that dent your legitimacy?"

"I think that is a very fair questionI am not claiming we cover the entire market - but what we are doing is giving people the opportunity to compare the ones who have selected to be on our site."

The reason not all funds are compared on Moneytime is because David and his team aren't doing this for love - they work for commission and if the fund won't pay - it doesn't get compared on the site. So, are consumers interests really being served or are Moneytime and Iselect just marketing tools of greedy health funds?

"Sometimes there can be a vested interest because some of these funds actually do get paid trailing commissions for bringing customers to the fund. But, the reality is i think it is better than what we have had in the past and if people are keen to learn more about health funds by going to these websites. I think in the end you can make better decisions and you can save some money," said Peter.

"This one was convenient, easy to use... You know, 80 bucks a month in my pocket. I am pretty happy," said the Blattmans.

For more information: Switzer Financial Services <> MoneyTime Insurance Comparisons site <> ISelect Insurance Comparisons Site