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What private health insurance covers

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Private health insurance cover is generally divided into hospital cover, general treatment cover (also known as ancillary or extras cover) and ambulance cover. If you plan to take out both hospital and general treatment cover, many insurers provide combined policies. Ambulance cover may be available separately, combined with other policies, or even covered by your state government.

Hospital cover

Public patient

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 privately insured.

As a public patient, you cannot choose your own doctor and you may not have a choice about when you are admitted to hospital.

Private patient

As a private patient you have the right to choose your own doctor, and decide whether you will be treated at a public or a private hospital that your doctor attends. You may also have more choice as to the timing of the treatment.

If you choose to be treated as a private patient in a hospital (public or private), Medicare will cover you for 75% of the Medicare Benefits Schedule (MBS) fee for associated medical costs.

You will be charged for the remaining 25% of the MBS fee for doctors' services, plus some or all the costs of:

• hospital accommodation,
• theatre fees,
• intensive care,
• drugs, dressings and other consumables,
• prostheses (surgically implanted),
• diagnostic tests,
• pharmaceuticals,
• any additional doctor's fees.

Private health hospital treatment cover insures you against some or all of these additional costs of being a private patient in either a public or private hospital. It also allows you to choose your own doctor or specialist, and the timing for any treatments required.

As with any other insurance policy, you can choose comprehensive cover with higher premiums, or pay lower premiums for reduced cover. You can also reduce your premiums by opting to pay some of the costs through an excess or co-payment.

Some insurers also offer 'gap cover' to cover some or all of the difference between the doctor's fee for services provided in hospital and the combined Medicare benefit and health insurance benefit.

With hospital cover, you can choose to be treated under either the public Medicare system, or in the private system, or in combination:

General treatment cover

General treatment cover (also called ancillary cover or extras cover) provides insurance against some or all costs of treatment by ancillary health service providers, depending on the type of policy you select, such as:

• dental treatment,
• chiropractic treatment,
• home nursing,
• podiatry,
• physiotherapy, occupational, speech and eye therapy,
• glasses and contact lenses,
• prostheses.

You can purchase general treatment insurance on its own or with hospital cover.

Ambulance cover

Health insurers may pay or reimburse you for all or part of your annual subscription to your state ambulance authority or the costs associated with transportation.

In Queensland and Tasmania, the state government pays the full costs of ambulance cover. Residents are charged a levy for this.

In other states, ambulance cover can be purchased from your private health insurer. If you are a pensioner or a low-income earner in NSW or ACT, your premium may be reduced because you may be entitled to free ambulance cover.
You can also arrange ambulance cover yourself from the ambulance authority in your state.

Note that ambulance cover can vary - some insurers provide cover for all ambulance travel, while others only cover a basic service.  Check the details with your insurer to ensure you obtain ambulance cover that best suits your needs.

You may not be covered if you require ambulance transport in a state other than the state in which you reside. Contact your State Government for more information on the arrangements that apply in your state.

What is not covered?

The health insurance policy you buy will have some limitations on the services it will pay for.

Limitations on hospital treatment might include:

• specific services that are not covered at all (known as 'exclusions'),
• services that are covered to a limited extent, which means you will have greater out-of-pocket expenses (known as 'restrictions'),
• benefit limitation periods, which pay reduced benefits on one or more services for a set period of time after the waiting period, then pay full benefits after this period,
• cosmetic surgery and other hospital treatment for which Medicare will not pay a benefit (Medicare pays a benefit on all medical services necessary to maintain your health, but does not cover optional treatments such as elective cosmetic surgery).

Nearly all services covered under general treatment are only covered to a limited extent. There are various limits that may apply, for example, a limit per service, per year, or lifetime limits. Some services may not be covered at all.

You should check the Standard Information Statement and obtain detailed information from your fund about these limitations.

Long stay patients

If you are in hospital for more than 35 days in succession, you will be regarded as a long stay or nursing home type patient, unless your doctor specifies otherwise.

This means you will have to pay more for the cost of hospital accommodation after the initial period. The Health Insurance Act 1973 does not allow health insurers to insure for this cost.

Private Patients Hospital Charter

The Department of Health and Ageing (DoHA) has prepared a charter, to help you understand what you can expect from your health insurer, doctor and hospital. The Private Patients Hospital Charter is available in English (PDF 139 KB) and a range of community languages.