The basics
Private health insurance in Australia is primarily divided into two categories: hospital cover and extras cover.
Hospital cover
This type of insurance covers you when you're admitted to a hospital as a private patient. It can include things like accommodation, doctor and surgeon fees, and theatre costs. Hospital cover policies vary, so it's essential to check what treatments and procedures are included. Some may cover a wide range of services, while others might be more restrictive.
Extras cover
Extras cover provides benefits for non-hospital services, like dental care, physiotherapy, optical services, and sometimes alternative therapies like acupuncture. This type of cover is particularly useful if you regularly use these services and want to reduce out-of-pocket costs.
Combined cover
Many people opt for a combined cover, which includes both hospital and extras cover. This can be convenient and sometimes more affordable, but it’s important to ensure the combined package meets all your specific health needs.
Who needs to be covered?
Different policies cater to different groups:
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Singles: A policy for an individual, often tailored to younger, healthier people who might not need extensive coverage.
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Couples: A shared policy for two people, which might offer discounts or additional benefits compared to two single policies.
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Families and single parents: Family policies cover parents and their children, with some insurers allowing children to remain on the policy until they’re 31 (conditions do apply, so always check with your chosen insurer).
What services do you need?
When selecting your cover, think about the specific services you might need now or in the future:
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Maternity and fertility treatments: If you're planning to start a family, maternity cover handy. However, it usually comes with a 12-month waiting period, so plan ahead.
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Mental health services: Some policies provide better access to psychiatric care, counselling, and related services.
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Specialist treatments: If you have a specific health condition, make sure your policy covers the necessary treatments. Some policies may exclude existing conditions, or limit coverage for things like joint replacements or cataract surgery.
Balancing your budget with your cover
Private health insurance premiums vary widely depending on the level of cover and your chosen insurer.
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Premiums: The amount you pay regularly (monthly or yearly) to maintain your insurance. Higher premiums generally offer more comprehensive coverage.
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Excess and co-payments: An excess is the amount you pay when you make a claim, while a co-payment is a smaller fee paid per service. Choosing a policy with a higher excess or co-payment can reduce your premiums.
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Government rebates: Depending on your income and age, you might be eligible for a rebate on your premiums. The Australian Government offers this rebate to make private health insurance more affordable.
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Medicare Levy Surcharge (MLS): If you earn above a certain threshold and don’t have private hospital cover, you might have to pay the MLS. Taking out a basic hospital cover policy can help you avoid this surcharge.
Don’t forget about waiting periods
Waiting periods are the times you have to wait after taking out a policy before you can claim certain benefits. Common waiting periods include:
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12 months for pre-existing conditions: If you have a pre-existing condition, you may have to wait 12 months before you can claim for treatment related to it.
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2-12 months for extras cover: Services like dental or optical might have shorter waiting periods.
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12 months for maternity cover: If you’re planning to have a baby, you’ll need to take out maternity cover at least a year in advance, if you want to attend a private hospital.
Review and compare regularly
Your health needs can change over time, so it’s essential to review your policy annually. There are lots of comparison tools to check if your current policy still offers good value or if switching to a different policy could save you money or provide better coverage.
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Health changes: If you develop a new health condition or start using more health services, consider upgrading your cover.
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Life changes: Major life events like getting married, having children, or retiring may mean you need to adjust your cover.
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Policy changes: Insurers can change the benefits they offer, so review your policy each year to make sure it's still the right one for you.
How to choose a provider
When choosing an insurer, consider:
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Reputation: Research different insurers to find one with a good reputation for customer service and claims handling.
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Provider networks: Some insurers have networks of hospitals and clinics that they work with, which can lower your out-of-pocket costs.
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Additional benefits: Look for extra perks, such as discounts on gym memberships or health programs, that some insurers offer.
Choosing private health insurance is a personal decision that depends on your health needs, lifestyle, and financial situation. By carefully considering the type of cover you need, who you need to cover, and your budget, you can find a policy that offers peace of mind and protection against unexpected medical expenses.
For more detailed information, visit: www.health.wa.gov.au
