Do You Need Health Insurance? If so, What Kind?

By on December 7, 2012

The majority of Australians’ health care is paid for by Medicare. However, there are plenty of reasons why you might need additional private health insurance. In this article, we are going to look at the pros and cons of signing up for private health cover, and outline the sort of plans available.

The most obvious reason that you would need private health insurance is financial. The government imposes a surcharge of between 1% and 1.5% – above the general 1.5% Medicare levy – for those higher income earners that do not have private hospital cover from a registered health fund. Since July 2012, the surcharge has been tiered, with the lowest contribution level being for individuals who earn over $84,000 a year – $168,000 a year for couples and families. The government does offer rebates to help cover the cost of premiums for all, except for those in the top tier of the surcharge.

In addition to its financial benefits, health insurance can greatly affect your treatment options. As a private patient you can choose to use either public or private hospitals, and decide which doctor treats you. Depending upon your choice of health insurance plan, you may also be entitled to treatment that is not covered by Medicare. This is why, if you are not Australian, private health insurance is one of the conditions on your visa.

If you decided to opt-in to private health insurance, you need to think about what plan will be suitable for you. If you’re a high income earner and your purpose is to avoid the above-mentioned surcharge, you will probably only need to buy Hospital cover. This is the most basic form of private health insurance and generally, covers exactly the same things as Medicare. You will, however, be able to choose your doctor and hospital.

General Treatment cover is the main other type of private health insurance. This provides for a wide range of medical treatments outside of hospital, including: dental examinations and treatment, physiotherapy, occupational therapy, psychotherapy, chiropractic treatment, podiatry, home nursing, acupuncture and speech therapy. General Treatment cover can also – but not always – pay for glasses, contact lenses, hearing aids and prosthetics. Most health funds also offer combined cover: Hospital and General Treatment cover in one package.

Whichever type of private health insurance you choose to take out make sure that you have read the policy documents thoroughly. Almost all health policies contain some exclusions –treatments that will not be covered – and restrictions, things that will only be covered by the policy to a limited extent. Also, be sure to check that you will have ambulance cover, especially if you live in one of the territories in which this must be paid for privately.

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