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Manage the GAP
MANAGE “GAP” WITH XHP - NOW YOU CAN!!
Often the two main reasons a lot of people mention as to why the purchase extras health cover is for peace of mind and the other to reduce out of pocket expenses or “GAP” to pay when the need arises.
Out of Pocket expenses is referred to as “GAP” and is one of the main reasons often cited by many people as the reason for not using their cover. Medicare Australia does not cover Extras Health except in very limited circumstances for people who meet specific requirements. Very often the amount of cover and the needs to the individual dont match and a GAP payment is triggered when certain thresholds of the cover are exceeded.
Such thresholds are often in the form of Annual limits, combined limits, life time cover which more or less results in the GAP as what the Private health insurance extras cover pays for may not be equal to the health invoice.
As a general rule the more you pay and higher the type of cover you have with your extras health provider, the higher the benefits you will receive per service. So the catch being you need to pay more to get more. Question though, is it a better value?
True cost of extras cover is the cost of private health insurance and the GAP costs associated with the desired service.
Irrespective of how long you have been with your private health extras cover provider you may have a “GAP” to pay as none of the unused funds accumulate towards eliminating potential GAP.
Do yourself a favour, if you would like to save money join XHP
Xtras Health Plan Savings Scheme (XHP)
Our Aim at XHP is to enable health and save money for our members so that they can enjoy their health. We do this by enabling our members to accumulate your money which over time has the potential to “eliminate the GAP”.
Your gap is dependent on your account balance. Used wisely you may be able to eliminate your GAP totally as your account balance will be greater than the spend.
Research has shown that many people just simply drop their cover as they are not able to afford the cover with the amount of gap paid on top. For some this has meant putting up with discomfort which over time has an effect on the individuals health and wellbeing.
At XHP, we get you and for that very reason we have designed XHP to make
- Healthcare affordable, and for peace of mind of knowing that unused funds accumulate in a dedicated account and earns interest as well for you.
- “NO GAP”, unless you have spent all the balance in your account. If your account balance is greater than the invoice amount you will never have a GAP.
- Quite simply you are in control of your health decision and health expenses on which services that you need to use and how much you wish to spend. Assuming you are careful on how the funds are spent it is very likely you may have adequate funds in the account to cover the big ticket item that you did not foresee coming.
- With preferred providers you will have the comfort of knowing the fee schedule is fixed in relation to the maximum fee that can be charged enabling you to quickly make informed decisions.
You are in the driving seat with XHP and can start to take advantage of the dedicated health savings scheme. To become a member, click here
FACT
With XHP as your unused money, rolls over each year you will build a nest egg over time to cover most of your extras health needs.
Let’s explore ”the dreaded GAP“ using Betty who wants to have a dental implant for her missing tooth as she is sick of the removable plates which is not attractive.
Assumptions for the case study:
Betty has had
- Health cover for 10 years and has been paying $1825 per year,
- pends on an average of $1000 per year on extras health needs
- Gap payable is 46.84%
Cost of the dental implant procedure is $5000
| Xtras Health Plan | Private Health Extras Cover |
| 1 | Total investment over 10 years $18250 | Total Premium paid over 10 years $18250 |
| 2 | Total spend over 10 years $10,000 | Total Spend over 10 years $10,000 |
| 3 | GAP paid on treatment $0 | GAP paid on treatment $4684 |
| 4 | Balance at end of 10th year $5,889 | Balance at end of 10th year $0 |
| 5 | Cost of dental Implant $5,000 | Cost of dental Implant $5,000 |
| 6 | GAP for dental implant treatment $0 | GAP for dental implant treatment $2,342 |
| 7 | Net benefit paid on dental implant $5,000 | Net benefit paid on dental implant $2,658 |
| 8 | Net cost over 10 years(Contribution fee+Management fee ($2361) | Net Cost over 10 years ($18,250 + $4,684+$2,342) $25,276 |
| 9 | Net benefits paid from XHP funds $15,000 | Net benefit paid over 10 years ($10,000 +$2,658) $12,658 |
| 10 | Account Balance after $15,000 spend – $889 | Account Balance after $15,000 spend – $0 |
Explore costs and compare
| Xtras Health Plan Saving Scheme | ||
| Fees and Charges | Total over 10 years | |
| 1 | Platform fee $199 | $1990 |
| 2 | Total Fees and Cost (Management and Contribution fee) | $2361 |
| 3 | Sum total cost over 10 years | $ 4,351 |
| 4 | Cost per day with XHP over 10 years | $1.20 |
| Private Health Extras Cover | ||
| Fees and Charges | Total over 10 years | |
| 1 | Total Premium per year $1825 | $18250 |
| 2 | Total GAP paid | $7,026 |
| 3 | Total Benefit received | $12,658 |
| 4 | Total GAP over 10 years less benefits received | $12,618 |
| 5 | Cost per day with Private health extras cover (premiums plus GAP paid) over 10 years | $6.92 |
Saving of $ 5.72 per day – Now you be the judge. It is your money after all.
Join XHP and save the smarter way. You and your family will be glad you did.
You are advised to check with your private health extras insurance provider, in case there is a change in their offering in which case you may be better off with private health insurance providers
Information provided is General Information only. Your personal circumstances have not been considered and does not constitute financial, legal, accounting or tax advice. Past performance is not indicative of future performance. Information used here is based on assumptions as above and as having occurred in the past, is not a future forecast. Account balance calculation is based on no spend for health with either PHI or XHP. The return for health insurance assumes no claim on a health insurance policy over the relevant period. No value has been attributed to holding a health insurance policy in the relevant period however it may be desirable to hold health insurance based on your personal circumstances.
Xtras Health Plan
Private Health Extras Cover
Contribution Paid over 10 years
GAP paid on services over 10 years
Net balance end of 10 years after spending of $10000
Cost of dental implant
Gap paid on implant
Net benefit received for implant treatment
Net cost over 10 years
Net benefit over 10 years
Net position after spend and dental implants
* – Cost include platform fee and Scheme fees
$ 18,250
$ 0.00
$ 5902.00
$ 5000.00
$ 0.00
$ 5000.00
$2347.68*
$ 15,000
$902.32
Premium Paid over 10 years
GAP paid on services over 10 years
Net balance end of 10 years after spending of $10000
Cost of dental implant
Gap paid on implant
Net benefit received for implant treatment
Net cost over 10 years
Net benefits over 10 years
Net Position after spend and dental implants
** – Cost includes premiums paid and the Gap paid
$ 18,250
$ 4684.00
$ 0.00
$ 5000.00
$ 2342.00
$ 2650.00
$25,276**
$ 12,658
$ – 12,618
Here is the kicker
Cost per day over 10 years for the spend of $15,000 over the 10-year period, including “Gap” with Extras Health Insurance.
XHP = .64 cents per day vs Extras health cover = $6.92 per day
This simple means with XHP you are ahead by $6.28 – If that is not a saving, then what is?
Guess you are better off with XHP.
Stop adding unnecessary financial pressure. Join XHP and save the smarter way. You and your family will be glad you did.
Information provided is General Information only. Your personal circumstances have not been considered and does not constitute financial, legal, accounting or tax advice. Past performance is not indicative of future performance. Information used here is based on assumptions as above and as having occurred in the past, is not a future forecast. Account balance calculation is based on no spend for health with either PHI or XHP. The return for health insurance assumes no claim on a health insurance policy over the relevant period. No value has been attributed to holding a health insurance policy in the relevant period however it may be desirable to hold health insurance based on your personal circumstances.
Proudly Australian for Australians
Australian Owned and Operated
Suite2, 36 Macaree Street,
Berserker, Rockhampton,
Queensland 4701
Phone (07) 4807 6424
Email [email protected]
Xtras Health Plan Savings Scheme (Xtras) is not an insurance policy and you should consider your personal circumstances before deciding whether to open an account. Funds deposited to an account will not be eligible for a private health insurance rebate. Xtras may be considered as a replacement for or to act supplementary to private health insurance depending on your personal circumstances. Xtras Health Plan Ltd does not warrant that Xtras is suitable for your personal circumstances and you should consider your health and financial needs before deciding whether to open an account. There is a risk that you may have insufficient funds in your account to meet the costs of health treatment depending on the treatment required and amount deposited to your account.
