Nearly half of Australians have never switched health insurers, new research shows as premiums are hiked on average 4.4 per cent on Wednesday.
Canstar analysis shows switching from the average to the cheapest gold hospital cover can save $1387 a year.
Private health insurance premiums are going up on average 4.41 per cent on April 1, though rates vary and high-end cover is subject to particularly steep hikes.
“With costs ramping up yet another notch, now’s the time to take a closer look at every recurring expense in your budget, and health insurance should be near the top of the checklist,” Canstar data director Sally Tindall said.
“Remember, switching isn’t your only option. If you’re happy with your current insurer, pick up the phone and ask for a better deal.
“Recite back to them the new customer promotion they’ve probably got running and ask as a loyal customer why you’re getting the raw end of that deal.”
Released on Wednesday, Canstar analysis finds 44 per cent of people have never switched insurers. However, 36 per cent of survey respondents had switched within the past two years.
As of Wednesday, HCF’s Hospital Optimal Gold cover is going up 25 per cent – about $167 a year for singles and $330 for families.
While not-for-profit GMHBA is lifting rates 1.98 per cent, for-profit agencies are hiking by more – AIA Health Insurance is going up 5.98 per cent, NIB premiums will rise 5.47 per cent, Medibank is hiking rates by 5.10 per cent and Bupa customers will pay 4.8 per cent more.
The insurers are pointing to higher hospital wages and medical tech costs, Australia’s ageing population and mental health and chronic disease issues following the pandemic as reasons for the hikes.
The federal government also acknowledges these are material factors; medical and hospital service costs rose 5 per cent last financial year. The 4.41 per cent hike effective on Wednesday is above the 3.73 per cent increase last year.
Canstar points out most insurers are looking to sweeten the deal for new customers, with some of the best deals on offer including 12 weeks free coverage, gift cards and frequent flyer points.
In the year to September 30, 2025, insurers paid out benefits of more than $26.7bn in health, medical and extras benefits, government figures show.
Announcing the approval of all price increases in February, Health Minister Mark Butler said the government asked insurers to “resubmit their premium requests multiple times”.
In Canberra on Wednesday, Mr Butler announced a new mental health support scheme that does not require a diagnosis or GP referral.
The Medicare Mental Health Check In program is expected to help 150,000 people each year, though only over-16s are eligible.
“We know the global fuel crisis is putting very significant cost-of-living pressure on Australian households … I would be amazed if that was not translating right now into higher levels of distress,” Mr Butler said.
“We want to make sure services are ready for that.”
St Vincent’s Health Australia has been awarded the service tender. Mr Butler said the government’s support for Headspace was one example of youth mental health support.
People are expected to use the new Medicare Mental Health Check In for general stress amid heightened cost of living. Life events like bereavements and relationship breakdowns were other reasons for people to seek the service, Mr Butler said.
The Productivity Commission also points to the need for a targeted mental health support scheme, in line with the UK’s NHS.
