2022 Private Health Insurance Premium Increases

Megan Fraser Updated: 24 March 2022

With the upcoming 2022 health insurance premium increase fast approaching, you may be wondering how the price rise will influence your health insurance. Learn more about the affect of the premium increases on your health insurance policy. Find out which insurer is offering the lowest increases to keep your health insurance as affordable as possible.

Although each health fund sets a specific increase for the coming year, the average premium increase for this year is 2.7%. This is the third year in a row when premium changes have been set to a record low. The 2022 increase of an average of 2.7% is the lowest premium increase in the past 20 years.

When do health insurance premiums increase?

Private health insurance premiums increase every year on 1 April. If your percentage increase is higher than the industry average of 2.7%, then your health fund must explain, in writing, why this was necessary. The premium you pay usually depends on your chosen health cover fund, cover type (Hospital cover, Extras, or Combined), and your coverage level.

Compare health insurance premium increases in 2022

Health Fund2022 Price Increase
Medibank3.10%
Bupa 3.18%
nib3.25%
HBF3.62%
Australian Unity2.73%
Teachers Health2.17%
GMHBA 3.10%
Defence Health3.33%
CBHS2.91%
AIA Health Insurance2.80%

Source: Health.gov.au (March 2022)

What causes private health insurance premiums to increase?

The three most common reasons for premium raises include:

When insurers have a more significant percentage of seniors, people aged 60 and over, premiums generally rise because the people with private coverage tend to require more frequent and expensive medical assistance and thus claim more. 

These annual price hikes are necessary so companies can continue to cover the costs of benefits, including the salary increases of medical practitioners and the latest expensive innovative technologies.

Average increase in health cover premiums in the past decade

Source: Australian Government Department of Health (March 2022)

Private health insurance premium increases delayed

Many Australian insurers have decided to postpone their premium rises until later in the year, as many citizens continue to battle the financial difficulties caused by the COVID-19 epidemic. This is an insurer’s attempt to help people cope with the pandemic’s consequences.

Insurers are also extending their COVID-19 aid measures to assist customers manage the continuing costs of maintaining a health insurance policy. If you’re in a similar position, see whether your health insurance policy offers any assistance or relief offers.

Insurers delaying premiums

Select insurers are delaying increases on their premiums. Below is a list of insurers who’ve decided to delay premium increases, and the dates on which increases will be implemented:

InsurerPremium increase date
HCF1 November 2022
Medibank/AHM1 October 2022
Teachers Health1 October 2022
nib1 September 2022
Defence Health1 October 2022
GMHBA1 October 2022

2022 Private Health Insurance Rebates

To assist you manage your budget and dealing with the rising cost of health cover, some private health insurance plans provide an income-related bonus from the Governments private health insurance act. Singletons and families with incomes ranging from $90,000 to more than $280,000 are eligible for the discounts. The benefits paid in the form of this rebate are intended to help you reduce your healthcare costs. 

However, as premium rates are at a historic low this year, the rebate has not been adjusted. So, if you’re eligible for the rebate, you’ll receive the same amount as you did last year. Rebates are typically effective on the same date as premium increases, which is usually on 1 April.

7 Ways to save money on private health insurance

  • Pay your premiums annually before 1 April 2022; then, you’ll be able to pay the same price for the next 12 months.
  • Review your policy to determine if you’re still using all the benefits you’re paying for. You might find that you can downgrade your cover and thus pay a lower premium.
  • Compare the type of policy you want between different health funds. You’re not bound by a contract and can switch at any time.
  • If you have a Hospital cover policy, consider paying a higher Excess, the amount of money you pay upfront when going to the hospital. A higher excess will usually result in cheaper premiums.
  • Claim your government rebate at tax time. The amount you can claim generally depends on your taxable income, age and family structure (single, couple or family).
  • Reduce your out-of-pocket costs by visiting a provider that’s part of your health insurers preferred providers network. You can also save by visiting private hospitals on your health insurer approved list.
  • Keep an eye out for discounts and promotions from health insurers. Health insurance companies compete for your business and will offer exclusive savings deals throughout the year.

Frequently asked questions and answers

  • Who approves the health premium increases?

    Health insurance companies must provide their proposal justifying their need to increase premium first to the Department of Health and the Australian Prudential Regulation Authority (APRA), who then carefully reviews it before sending it to the Commonwealth Minister of Health for approval.
  • How do you know if your payment is going to rise?

    Most health funds should contact members by the middle of March to inform them of the increases in their monthly fees. Your health fund should notify you via post or email. If you are unsure about when you’ll be informed of the changes, it may be a good idea to contact your fund.
  • Will my health insurance premiums go up?

    Yes, all insurers have confirmed that health insurance premiums will be rising on 1 April 2021. If you think that you won’t afford your monthly premiums once the increases have been implemented, you may want to shop around for a policy that suits your requirements.
  • Does the 2022 increase match inflation?

    No, although this is the lowest premium increase in the past decade at an average increase of 2.7%, it is still higher than the projected inflation rate for 2022. Core inflation, which does not include the cost of food or energy, is projected at 2% for 2022.
  • Do I need to re serve waiting periods when you switch providers?

    If you find that your current health insurance policy no longer meets your requirements, you’ll typically be able to switch from your current health insurer to a provider who offers more affordable cover. However, this only applies if you switch to a policy that offers the same level of cover or lower. It’s generally a good idea to compare all of your options before deciding.
  • How do I avoid Medicare levy surcharge in Australia?

    Typically, you’ll be able to avoid having to pay the surcharge by applying for a qualifying private Hospital insurance policy. If you maintain this policy, you generally won’t need to pay this unless your policy lapses. Having a Basic Hospital policy should be sufficient for exemption from the surcharge.
  • Do health insurance premiums increase with age?

    No, typically your health costs won’t increase as you age. Generally, insurers won’t implement any unexpected increases. Typically, your insurer has to inform you of any increases in writing at least 30 days before the increase. This provides you with the opportunity to compare policies to find a provider who offers a better price.

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