Families are saving more than $2000 on health fund premiums as they hurry to beat the looming means test on the 30 per cent private health insurance rebate.
Funds have been swamped by members prepaying their premiums, with some planning to extend their trading hours to cope with a last-minute rush before the means test is imposed from Sunday.
Under the means test, the 30 per cent rebate will be wound back for singles earning more than $84,000 a year and couples/families on more than $168,000. Singles on more than $130,000 a year and couples/families on $260,000 a year will lose the rebate.
The tax penalty on high-income earners without health cover, the Medicare Levy Surcharge, will also rise to discourage people from abandoning their cover.
Policyholders can prepay for up to 18 months, allowing them to dodge the means test, as well as next year's annual rise, by locking in their current premium rate.
A family with HBF top hospital and standard essentials cover can prepay $5233 in premiums for the next 18 months now, saving between $748 and $2243, depending on how much of the rebate they lose.
Singles can also save a few hundred dollars. A 35-year-old with Medibank's mid-range hospital and basic extras cover could prepay $1177 for the next 12 months, saving between $168 and $505.
HBF said more than 7000 members had opted to prepay, and Medibank, Australia's biggest fund, said 22,000 had done so. WA-based fund HIF would not reveal the number of members who had prepaid but said it was a fourfold increase.
Health funds need to receive the money from their members by Saturday to guarantee the lower rate.
HBF plans to keep its branches open later on Thursday and open on Saturday to cope with customers wanting to prepay. HBF and HIF will also keep their call centres open longer on Saturday.
The Consumers Health Forum agreed prepaying was a significant saving but warned there was a downside."If someone wants to change their level of cover they may not be able to," chief executive Carol Bennett said.
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