Private health insurance gives people the ability to select the best possible care, but Hunter residents are increasingly backing out as premiums continue to increase.
A recent survey of NSW found that around 57 per cent don't have private health insurance because they simply cannot afford it. Of those who are privately insured, around 24 per cent say they were likely to downgrade or completely drop their insurance cover in the next 12 months.
Laura Crowden from insurance watchdog iSelect says there's a significant trend causing the huge drop in those covered by private health insurance.
"The participation rates in private health insurance have been declining for many years. At the same time we've seen premiums continue to increase. So since 2010 on average premiums have risen 50 per cent which really means a lot of people are simply unable to afford those sorts of costs."
With many residents considering dropping out, the insurance watchdog is urging everyone to check their cover and make sure you are insured for what you actually need, otherwise you run the risk of additional tax or extra costs if you do choose to opt out.
Extra costs include the government's Lifetime Health Cover (LHC) loading and the Medicare Levy Surcharge for higher income earners (an additional tax on top of the standard 2% Medicare Levy for those who earn over $90,000 (single) or $180,000 (couple/family) and don't have private hospital cover).
"It's really important people understand the implications of either dropping or downgrading or not having private health insurance. It's not for everyone, but certainly the benefits of private health insurance are greater choice and peace of mind that you're able to choose your own doctor, choose your own hospital and be treated much more quickly for elective surgery," said Laura Crowden.
iSelect say it's really important for those struggling with the costs to have a look at their options ahead of June 30 to see if they can get a better deal.
"So first thing we'd encourage Newcastle residents to not set and forget. Don't just take out a private health insurance policy and then just keep it ticking along without regularly reviewing it because as your health needs change as you're either getting older or starting a family it's really important that your private health policy changes with you."
