Why do Australians buy private hospital insurance?

Melbourne Institute Research Insight No. 06/21

Date: May 2021


Professor Yuting Zhang
Dr Kushneel Prakash


All Australians have access to Medicare that covers free hospital treatment. So why do people still buy private hospital insurance? In April 2021, we surveyed Australians to ask them why they paid for private hospital insurance, and we found that many members purchased it for peace of mind, with this reason becoming more likely as Australians got older. Among those who do not buy private hospital insurance, two-thirds reported they did not purchase because of high premiums and out-of-pocket costs; and half cited because they are happy with public hospitals.

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