Private Health Insurance or Self Insurance?
April 12, 2011 11:23 PM Subscribe
I'm being kicked off my parents health insurance, so I'm trying to decide whether to take out my own policy or "self insure". Is there something major that I'm overlooking? (In Australia)
posted by cholly to health & fitness (11 answers total) 1 user marked this as a favorite
My sister and I are currently covered under an extension to my parents policy that accommodates non-student adult-children. In May my sister will turn 25 and not be eligible for this - the additional premium won't be reduced so it makes no sense for me to remain on this plan.
I'm 22, single, fit and have no health issues apart from wearing orthotics for flat feet. I have an annual dental check-up but that's about it.
For me to be covered under an equivalent level to the family plan I would be ~$90/month - and I'd be covered for a whole lot of unnecessary stuff. The absolute basic hospital and extras cover will probably cost me$40-50/month, won't cover my orthotics ($300 every two years), and will probably have a $500 excess. For this reason, I'm considering self-insuring - ie. opening a savings account where I deposit $40-50 a month to cover my dentist bill, my bi-annual orthotic replacement and any unexpected things like physio if I injure myself.
Things I have considered:
1. I'm in Australia so if, god forbid, I am in a serious accident, Medicare will cover my hospitalisation if I'm not privately insured. My current GP bulk bills and I also don't plan on starting a family any time soon.
2. I have 7 years before the Lifetime Health cover loading applies to me I earn well under the threshold for the additional 1% Medicare surcharge - so tax wise I don't think I will be worse off without insurance.
3. I won't have to re-serve waiting periods if I switch my cover now, but will have to when I join a fund in the future.
At this stage, self-insuring seems to make the most sense - at least for the next few years. I'm pretty good with saving - so I know that I will have no problems leaving my "health account" untouched.
Is there anything that I'm overlooking?