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Private health insurance

6-minute read

What is private health insurance?

Private health insurance allows you to get treatment in hospital as a private patient. It can also pay for other treatments that Medicare doesn't cover.

To get private health insurance, you need to:

What types of private health insurance are available?

There are two types of private health insurance:

  • Hospital cover
  • Extras cover

Hospital cover helps with the cost of treatment and accommodation as a private patient in hospital.

You can choose to be cared for as a private patient in either a public hospital or a private hospital.

You can also choose your own doctor.

If you choose to be cared for as a private patient in hospital, Medicare will cover 75% of the Medicare Benefits Schedule (MBS) fee.

You will probably have to pay a ‘gap’ fee. This is the difference between how much your doctor charges, and your joint cover from Medicare and your health insurer.

Your remaining costs might include:

  • 25% of the MBS fee for doctors' services
  • hospital accommodation
  • theatre fees
  • intensive care costs
  • medicines, dressings, and other consumables
  • prostheses (surgically implanted)
  • diagnostic tests
  • any extra doctor's fees

Extras cover includes health services not provided by a doctor. This can cover optical, physiotherapy and dental work. This is also known as ‘ancillary cover’.

Most private health insurers offer:

  1. combined policies that have both hospital and extras cover
  2. separate hospital and extras policies

How much coverage do I need?

All hospital insurance policies are now ranked as:

  • Basic
  • Bronze
  • Silver
  • Gold

The higher the category, the more conditions are covered. Higher categories of hospital insurance cost more.

The Australian Government website allows you to compare private health insurance policies. This can help you decide what type of private health insurance is best for you and your family.

Does private health insurance cover ambulance transport?

Private health insurance can also cover transport by ambulance.

Some insurers cover all ambulance travel, while others only cover ground travel.

Check with your insurer about which type of ambulance cover best suits your needs.

What should I think about when looking into private health insurance?

If you choose to take out private health insurance, try to make sure that you understand:

  • what types of health care is covered
  • what types of health care is not covered
  • how long it takes private health insurance to cover any health conditions you already have

What doesn’t private health insurance cover?

Private health insurance does not cover:

  • visits to your doctor
  • visits with specialists in their rooms
  • imaging and tests to diagnose conditions

How does the Government help people take out private health insurance?

The Australian Government helps people to take out and keep private health insurance through the:

The private health insurance rebate lowers the cost of your private health insurance. The amount that you get is income tested.

Lifetime health cover aims to encourage people to take out hospital cover earlier in life and keep it. If you delay taking out hospital cover, you may need to pay 2% extra for every year you are aged over 30 years for a period of time.

Australians who earn a certain income AND don’t have private health insurance, have to pay the Medicare levy surcharge.

Do I have to have private health insurance?

You do not have to have private health insurance in Australia. All Australian residents can get healthcare through Medicare.

Waiting times for elective (planned) surgery under Medicare can sometimes be long. Private hospital insurance can enable you to have elective surgery done sooner in the private system.

Do I need health insurance if I’m an overseas visitor or student?

Most visitors to Australia are not covered by Medicare.

Some countries have a reciprocal health care agreement with Australia. This mean that you might be able to get emergency healthcare in Australia.

The countries with reciprocal health care agreements are:

  • Belgium
  • Finland
  • Italy
  • Malta
  • The Netherlands
  • New Zealand
  • Norway
  • The Republic of Ireland
  • Slovenia
  • Sweden
  • The United Kingdom

It is wise to take out travel insurance to cover you for medical emergencies while you are in Australia.

Some Australian visas need you to take out private health insurance. If you are studying in Australia and have a temporary student visa, you will need overseas student health cover.

Who can help me with a private health insurance problem?

If you have a problem with your private health insurance, talk to your private health insurer directly.

If you aren’t happy with how your private health insurer has dealt with your concerns, you can contact the Private Health Insurance Ombudsman.

You can find out more about private health insurance on the Australian Department of Health and Aged Care website.

Learn more here about the development and quality assurance of healthdirect content.

Last reviewed: August 2022

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