Health Care in Australia
Private Health InsuranceMany Australians choose to take out some form of private health insurance. There are many healthcare funds in the marketplace and each offers a variety of schemes and levels of cover.
Healthcare funds are insurance companies - they do not run hospitals or practices, although they may have relationships with certain hospitals and practitioners. Many of the health insurers in Australia offer other types of insurance as well.
As with all insurance policies, the concepts of premiums, claim limits, excess payments (or 'member contributions') apply.
Probably the biggest choice for the customer is whether to opt for hospital cover, ancillary cover or both.
Ancillary CoverAncillary Health Insurance, also known as 'essentials' or 'extras', covers medical and complementary treatments that do not attract a Medicare benefit. For example; dental, optical, podiatry, physiotherapy, chiropractic, osteopathy etc.
Most funds offer various options to suit people's requirements, such as:
- A higher benefit when you claim - you can pay a lower monthly premium and get say 60% of your treatment cost back, or pay a higher premium and get 100% back.
- Annual Limits - all funds operate annual claim limits, but for an increased monthly premium, you can get a higher limit, or no limit at all.
- Select specific treatments - with some funds you can get cover for ambulance, dental and physio (for example), but ignore all other therapies, thus lowering your premiums.
Hospital CoverPrivate Hospital cover allows you to choose when to have your treatment, which hospital to go into and even which doctor or consultant will treat you.
Typically, a policy will cover all hospital accommodation and theatre costs, less an excess that could be $250 or $500.
The policy would also contribute towards the fees charged by the surgeon and anaesthetist, but often there is still a 'hospital gap' - some out-of-pocket expenses.
Out-of-pocket ExpensesEven though you are treated as a private patient, Medicare covers some of your doctor and anaesthetist's fees; 75% of the Medicare Schedule Fee relating to that procedure. Your private health fund covers the remaining 25%.
But if your doctors charge more than the Medicare Schedule Fee (and many do), you will still have out-of-pocket expenses.
You may also find that your fund does not cover pharmaceutical charges for medicines you need while in hostpital.
Limits of CoverEach fund will have an annual claim limit per treatment category and limits on individual claims and medical procedures - working out the best policy for your situation it can be a very complicated process.
Waiting PeriodsAll health funds operate waiting periods (also called 'qualifying periods'), whereby new customers have to wait a specified period before being eligible to claim benefits. When comparing health funds, you should pay particular attention to these waiting periods, as they can vary considerably.
A typical example is a six-month qualifying period before you can claim for spectacles or contact lenses.
Occasionally a health fund may waive certain qualifying periods as part of a marketing initiative, or under special circumstances.
Pre-existing ConditionsThere may be a specific waiting period (typically 12 months) for claiming for treatment of a pre-existing condition (which you know you have when you join a fund).
Switching Health FundsThere are many health insurers to choose from, so it's a good idea toreview your policy every so often. If you decide to switch funds, you can do so with minimal effort.
Your new fund will waive any waiting periods that you have already served with your old fund. The amount of year-to-date benefits you have already received from your previous fund will probably be transferred as the opening balance on your new fund also.
No Claims Discount/No Claims BonusUnder the Private Health Insurance Act 2007, health insurers are not permitted to charge different premiums to customers based upon their medical condition. As a result, they do not offer a No Claims Discount to customers who have not claimed on their policy.
Preferred ProvidersSome health funds, especially the larger ones, operate a list of preferred providers, both hospitals and practitioners. They may refer to them as "members choice", "participating provider" or similar.
It is usually advantageous for the customer to go to one of these providers, as it should result in a smaller gap payment.