Health Insurance

What is a Not-For-Profit Health Fund?

A ‘not-for-profit’ health fund is one where the premiums paid into the fund are used only to pay out benefits benefits for members and to operate the business. In contrast, ‘for-profit’ funds aim to return a profit to their owners. The owners may be shareholders – for example Medibank Private, which is listed on the Australian Stock Exchange, or a corporation – for example Bupa, which is owned by (and sends profits to) its UK-based parent company.

Recent figures show that members of not-for-profit-funds are better off than those in profit-generating funds – enjoying either lower premiums or higher benefits, or a combination at the two. Members of not-for-profit funds received on average 88.9 cents back in benefits for every premium dollar paid, compared to 84.8 cents for members of Australia’s top three for-profit funds – Medibank, Bupa and NIB – which have two-thirds of the market.

For-profit health funds are generating huge profits (Medibank Private’s 2018 profit was $445 million), while consumers are coping with premium rises that are typically well above the rate of inflation, as well as a declining percentage of government premium rebate.

Not-for-profit health funds include Defence Health, HBF, HCF, and Mildura Health. A full list of not-for-profit funds is available online.

Note that some not-for-profits impose membership restrictions, however many do not. Not-for-profit health funds also tend to have a lower incidence of preferred provider agreements and differential rebate schemes, which can also benefit the consumer.

Is Private Health Insurance / Extras cover worthwhile?

In any discussion around private health insurance, distinction needs to be made between Hospital cover and Extras cover. Dental benefits fall exclusively under Extras cover. Unlike Hospital cover, Extras cover is not required to avoid the additional medicare levy, so there is no financial penalty from the government if Extras cover is not purchased.

Extras cover is also the area where Private Health Insurance companies make the majority of their profit, with margins as high as 22 cents in the dollar. To make this high margin on Extras cover, insurance companies heavily promote it in advertising material whilst simultaneously limiting the benefits which are paid out to customers. With profit margins so high for the insurance companies, it means that the the large majority of people would be better off dropping their extras cover and paying the full cost of dental, physio and optical treatments out of pocket.

Some large health funds also promise their clients that they will get a bigger rebate if they leave their dentist of personal choice and go to one nominated by their fund as a preferred provider. This promotion is made with no regard to the relative experience or quality of the dentists and dental practices involved. Patients are also not made aware of the details of the preferred provider agreements and what impact these agreements may have on the quality of treatment that they are provided.

Most Private Health Insurance companies are big businesses generating big profits, at the expense of their customers. For example, in the 2015 financial year alone, Bupa generated $328.7 million in profit in Australia for its UK parent company. In the 2016 financial year, Medibank Private generated a profit of $417.6 million.

With health insurance premiums typically rising at well above the rate of inflation each year, we would encourage everyone to ensure they feel they are getting full value from the premiums that they are paying out for Extras cover. If Extras cover is considered a necessity, another option is to consider buying it from one of the smaller not-for-profit mutual providers (e.g. Defence Health, HPL). These providers typically pay out more of the premiums received, and do not practice discriminatory differential rebates.

[Source: ‘Dental patients exploited by large health insurance funds’ By Graham Middleton, BA, MBA – Australasian Dental Practice – September/October 2016]

Which private health insurance companies do you accept rebates from?

We accept rebates from all major private health insurance companies. These rebates must be processed on the day of your treatment.

Is Goodwood Dental a ‘preferred provider’?

In recent years, some health funds have introduced ‘preferred provider’ schemes which claim to decrease your out-of-pocket costs, at the expense of your health fund dictating to you which dentist you can see. These schemes do not take into account the experience or quality of the dentist and dental practice. Preferred provider schemes also impose restrictions on dental practices which could result in compromises in the delivery of patient care. The Australian Dental Association states that ‘preferred provider’ arrangements are more about the bottom line for Private Health Insurers than health outcomes for patients.

At Goodwood Dental, we do not believe that preferred provider schemes are in the best interest of patients and consequently we are not a member of any preferred provider schemes. We commit instead to providing our patients with:

  • experienced, dedicated dentists and staff with high order clinical, administrative and interpersonal skills,
  • honest, accurate and reliable advice, information, treatment and care to patients at reasonable prices,
  • safety and care at all times through best practice sterilisation procedures and modern, state-of the-art equipment, and,
  • a welcoming, clean and comfortable patient environment.


Dental Costs

How do I minimise the amount I pay for dentistry?

  1. Ensure that you maintain your teeth and gum health by flossing daily and brushing morning and night using fluoride toothpaste.
  2. Visit your dentist at recommended intervals for a check up. For most people this will be approximately every 6 months, although it may be sooner if you have problems that require more frequent monitoring. When a problem is detected early, it can usually be addressed before it develops into a more complex problem that requires more drastic or expensive treatment. A regular check up maximises the chance of detecting problems early.
  3. Discuss your treatment with your dentist. For any dental problem, there are usually multiple treatment options available, all of which will have different costs. At Goodwood Dental, we will give you the information you need to make an informed choice about the most suitable treatment for you, including costs and pros and cons of each available option.
  4. If you are paying for Extras cover, ensure that you are receiving value for money. Remember that although you may be penalised for not holding Hospital cover, that does not apply to Extras cover. Private Health Insurance companies are making margins of up to 22% on Extras cover which is funneled back to their overseas parent companies or shareholders. The reality of this statistic means that many families and individuals are likely to be hundreds of dollars a year out of pocket by having Extras cover, effectively paying in advance for dental, physiotherapy and other ancillary health care that they are not using. Though it may be clever marketing, a free check up every 6 months is unlikely to be adequate compensation for the ever-growing premiums that you are charged for Extras cover. Also consider that when high cost treatments (e.g. crowns or implants) are required, Extras cover will generally only rebate a small portion of the total cost. You may be one of the many people who would be financially better off to stop paying Extras cover premiums and instead pay their dental and other ancillary healthcare costs directly.


What forms of payment do you accept?

We accept payment by cash or EFTPOS using Visa/Mastercard credit/debit cards, American Express, or bank account transfer. We also accept rebates from all major private health insurance companies which can be electronically processed on the day of your treatment.

When is payment required?

For most services, payment is generally required on the day of treatment. For particularly long or complex treatments (for example, implants, crowns), full payment may not be required until the treatment is completed. However, in this case we may ask you to pay a deposit to help cover the costs of external services such as laboratory work which are incurred prior to completion of the treatment. If you have any concerns regarding payment please speak to one of our friendly staff.