Mind the Gap – private health out-of-pocket costs hit new highs

Australians with health cover are paying larger out-of-pocket costs for private treatment than ever, new data shows. 

The average Gap for private hospital treatment has climbed to $511.02 – an increase of 8.4% from the previous quarter, according to the latest statistics from government regulator APRA (the Australian Prudential Regulation Authority).  

Average Gaps for Extras Cover have increased to $65.02 – a 3.4% rise. 

Orthopaedic procedures remain the most expensive when it comes to out-of-pocket costs, with an average Gap of $849.93. For example, knee replacement patients, one of the most common elective surgeries, paid an average Gap of $1,000 in 2023-24, Medical Cost Finder data shows. But healthslips.com.au tracking shows the average Gap for that surgery was $880 in 2022-23 – a 14% jump in just 12 months.  

These increased Gaps come at a time when households are dealing with the highest health cover premium hikes in almost a decade. Premiums rose by an average of 4.41% on 1 April, and crucially, analysis by heathslips.com.au found Family policies were among the hardest hit, with an average jump of 5.64% compared to 4.32% increases for Singles. 

The financial pressure is already changing patient behaviour. Earlier this year, a survey by Private Healthcare Australia, peak body for the health insurance industry, found almost 1 in 3 people had delayed or cancelled specialist care due to costs.  

“People are delaying care they have been told they need because they are worried about the cost, can’t afford the fees or cannot find a specialist near home,” said Private Healthcare Australia CEO Dr Rachel David in February.  

View the APRA quarterly data here. 

Trudie McConnochie

Writer and Researcher

Knowledge is power – that’s the guiding principle behind everything Trudie writes, and it’s a philosophy she brings to her work at healthslips.com.au. By breaking down complex information into easy-to-understand blogs and stories, she aims to empower Australians to make the best choices and an informed decision around private health insurance.

Trudie understands firsthand some of the complexity of private health insurance having moved to Australia from New Zealand and having to navigate a vastly different public healthcare system and health insurance structure.

Trudie holds a Bachelor of Communication Studies (journalism major) from the Auckland University of Technology.

Read more.