I wouldn't go withough PHI. I certainly would scale it down to less than what we have now as we will not be having anymore children.
My DS2 has two lots of grommets and adenoids removed. And has had 4 crowns on his teeth. All of this through private health insurance.
If I had to go through the public system with his ears it could have been at least 12mths wait and he would have been in alot pain and on constant AB's. If we had no PHI and decided to pay for his ear op's it would have cost us roughly $4,000 each time.
And with his teeeth if we went on the public register it could also have been a very long wait while his teeth deteriorated even further. This confirmed to us that we could not live with out it.
I know you went through Midwife and will continue...I had all my kids private, I am way ahead with PHI in cost and well being.
Like other's have mentioned, you just don't know what's around the corner.
As Bathesba said, you have to weigh up how much it would cost in the future or now in your end of financial year tax. As in would you be hit with the an extra Medicare Levy if you didn't have PHI.