PrivateHealth.gov.au

Frequently asked questions

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The following questions are grouped under these topics:

• Standard Information Statements
• Lifetime Health Cover
• Medicare Levy Surcharge
• Rebates and tax breaks
• Types of policies
• Excesses and co-payments
• Restrictions and exclusions
• Waiting periods
• Gaps and out-of-pocket expenses
• About insurers
• Problems with your insurer
• Overseas visitors

If you were born before 1 July 1934, you are exempt from LHC. If you have paid a LHC loading on your private health insurance for 10 continuous years, the loading will be removed as long as you maintain your hospital cover. Some other special circumstances apply - for more information, see Lifetime Health Cover.

Does Lifetime Health Cover apply to ancillary (extras) insurance?

No. The LHC loading does not apply to general treatment cover (also called ancillary or extras cover) or ambulance cover. Note that maintaining general treatment cover does not protect you from the LHC loading if you then decide to take out hospital cover.

What if I leave a fund at 35 and join again at 40? How does that affect my Lifetime Health Cover?

If you drop your health cover for periods totalling 1094 days (one day less than three years) during your lifetime, this will not affect your loading. If you have a total gap of three years or more, you will pay a 2% loading. For every 365 days without cover after that, your loading will increase by 2%. So if you leave at 35 and join again at 40, your LHC loading will be 6%.

What if I'm overseas when I turn 30? How will that affect my Lifetime Health Cover rating?

If you are an Australian citizen or permanent resident who is overseas on the LHC deadline (that is, overseas on 1 July following on your 31st birthday), you will not pay a Lifetime Health Cover loading if you purchase hospital cover by the first anniversary of the day you return to Australia.

You are able to return to Australia for periods of up to 90 consecutive days, and are still considered to be overseas. For more information, see Lifetime Health Cover.

You do not have to pay the Surcharge if your taxable income is below the income threshold, or you have taken out hospital cover with a front-end deductible or excess of up to $500 for singles or up to $1,000 for families/couples, on or before 24 May 2000. For more information, see Medicare Levy Surcharge.

Does taking out a general treatment (extras or ancillary) policy exempt me from the Medicare Levy Surcharge?

No. Your general treatment cover (also called ancillary or extras cover) and ambulance cover do not have any effect on the Surcharge.

You can claim the Rebate as a reduction on your premium, as a direct payment, or claim it back on your tax return. For more information, see Private Health Insurance Rebate.

Do older people get a higher Rebate?

Yes. The Rebate is 35% for people aged between 65 and 69 years, and 40% for people aged over 70 years. For more information, see Private Health Insurance Rebate.

What tax breaks are available for medical costs I pay myself?

You can claim a tax offset of 20% - 20 cents in the dollar - of your net medical expenses are over $1,500 in a tax year. There is no upper limit on the amount you can claim. Further information is available on the Australian Taxation Office website:

http://www.ato.gov.au/individuals/content.asp?doc=/content/19181.htm

Policies that cover one adult and dependent(s) are suitable for single parent families. You can use the 'search by features' tool on this website to help you find the best cover for your particular needs. For more information, see Who is covered.

What does general treatment (extras) insurance cover me for?

General treatment policies (also called extras or ancillary cover) cover medical services outside a hospital, such as dental, optical, physiotherapy and chiropractic treatment. Depending on the level of cover, it might also include major dental, orthodontics, occupational therapy, pharmaceuticals, podiatry, and hearing aids. Check the specific details of your policy to ensure you are covered for the services you require. For more information, see What private health insurance covers.

Does general treatment (ancillary or extras) insurance cover me for the full cost of treatments like dental or optical?

The amount your health insurance will pay depends on the specific policy you choose, the level of gap cover, and the arrangements your insurer has with preferred suppliers, such as dental clinics. For more information, see What private health insurance covers and gap cover.

Why would I take out hospital insurance if I am already covered by Medicare?

Under Medicare, you can be treated as a public patient in a public hospital, at no charge, by a doctor appointed by the hospital. You can choose to be treated as a public patient, even if you are insured. For more information, see what Medicare covers.

Hospital cover allows you to choose your own doctor or specialist, and covers some or all of the extra costs of private accommodation and additional doctor's fees above the Medical Benefits Schedule. For a high income earner, an appropriate level of Hospital cover also protects you from the Medicare Levy Surcharge. For more information, see What private health insurance covers.

I would like to be covered for ambulance. What policy do I need?

This depends on the state you live in. In QLD and TAS, residents pay a state levy and ambulance cover is provided free by the state government. NSW and ACT provide free ambulance cover for pensioners and low income earners.

In other states, you can arrange ambulance cover yourself from the ambulance authority in your state. Alternatively, you can arrange cover with your health insurer. The Standard Information Statements show which policies include ambulance cover, or whether this is provided by the state.

What is broader health cover?

These services are broader than those traditionally provided within the hospital. Broader health cover services do not require admission to hospital, but may be a part of hospital care, substitute for hospital care, or prevent hospitalisation. These services cover outpatient and out-of-hospital services, chronic disease management for conditions such as diabetes and asthma, and disease prevention measures.

An excess is also known as a front-end deductible. This is an amount that you agree to pay towards the cost of hospital treatment, in exchange for lower premiums. You may need to pay an excess every time you go to hospital, or only the first time, depending on your specific policy. For more information, see Lowering your premiums.

What is a co-payment?

A co-payment is also known as an overnight excess or patient moiety. With a co-payment, you agree to pay a set amount each day you are in hospital, in exchange for lower premiums. For example, you agree to pay the first $50 per day in hospital. Most co-payments have a maximum amount per hospital stay, or a limit on the number of days it applies per stay. For more information, see Lowering your premiums.

If you need to be admitted to hospital within the first 12 months of your membership, you may not be entitled to benefits if your health insurer determines that your condition was pre-existing. You should contact your insurer straight away to check if you will be entitled to hospital benefits. If you go to hospital before your insurer has advised you whether you are entitled to benefits, you may become responsible for all costs associated with the admission. The PHIO website has a brochure on waiting periods:
Waiting Periods Brochure. (PDF 215 KB)

A 'gap' is the amount you pay out of your own pocket for treatment in hospital, either for medical or hospital charges, over and above what you get back from Medicare or your private health insurer. Some health insurers have gap cover arrangements to insure against some or all of these additional payments.
Gap cover arrangements minimise any gaps between the Medical Benefits Schedule (MBS) fee and what doctors actually charge. Some gap cover arrangements provide partial cover for the gap between the MBS fee and actual doctor's fee. Other gap cover arrangements provide full cover. Doctors can decide to use the gap cover arrangements on a case-by-case basis, so full cover cannot usually be guaranteed by the insurer. For more information, see Out-of-pocket expenses.

Does hospital insurance cover me for the full cost of a hospital visit?

This will depend on the type of policy you have, whether your insurer provides gap cover, and the arrangements your insurer has with the hospital you visit. If you have selected a policy with an excess or co-payment, you will have to pay the agreed amount per day or per treatment.

For more information, see What private health insurance covers and Out-of-pocket expenses.

How can I avoid unexpected costs when going to hospital?

If possible, before you start your treatment, ask your doctor for a written, detailed estimate of the fees involved, including any out-of-pocket costs.  Contact your health insurer with the details of your treatment and confirm what benefits it will pay and what you will need to pay. Check to see if you could reduce your costs by attending a suitable agreement hospital. For more information, see Out-of-pocket expenses.

My insurer doesn't have an agreement with the hospital I want to go to. What does this mean for me?

It means you might have additional out-of-pocket costs for your treatment. You should check your likely costs carefully with your doctor, hospital and health insurer before starting your treatment. For more information, see Out-of-pocket expenses.

As at April 2007, there are 38 health insurers registered with the Department of Health and Ageing. Of these, 25 are open membership insurers, available to anyone, and 13 are restricted membership insurers, which are available to specific industry groups. For a detailed list of insurers, see Search by insurer.

What are restricted insurers?

A restricted membership insurer provides health insurance to a specific industry or group, such as teachers, navy personnel or transport workers. You must be a member of the industry or group to take out a policy. In some cases, family members are also eligible. For a detailed list, see restricted insurers.

What should I look for when choosing a health insurer?

As well as looking at the details of specific policies, you should make sure the insurer's general services suit your needs. A good place to start is our list of questions to ask health insurers. You may also be interested in the annual report cards produced by the Private Health Insurance Ombudsman (PHIO), which compare insurers in areas such as customer satisfaction, gap cover arrangements, average prices and benefits, complaints and finances.

How can I switch health insurance?

You can transfer from one health policy to another, at the same or a lower level of benefit, without serving extra waiting periods. This is true even if you move to another insurer.

Your new insurer must give you credit for the waiting periods you have already served. Benefits paid by the previous insurer may be taken into account by your new insurer when it determines your annual benefit limits. You may have waiting periods before you are eligible for any new or higher benefits that are part of your new policy.

In most cases, you can authorise your new insurer to transfer your membership from your old insurer - check with your insurer about their specific processes. You will also need to cancel any automatic payment authority you may have with your existing health insurer. For more information, see The Right to Change. (PDF 234 KB)

Is there any advantage to staying with one health insurer for a long time?

Although you can transfer insurers without having to re-serve waiting periods, some product features or benefits which increase over time may not be transferable. You need to check with your health insurer.

The first step you should take is to try to resolve matters with the insurer. If you still have a problem or need some advice contact the Private Health Insurance Ombudsman(PHIO). The PHIO website has a brochure on how to lodge a complaint:
Making a Complaint to PHIO. (PDF 168 KB)

A number of private health insurers provide health cover for overseas visitors. For more information, see Cover for overseas visitors.