Beginners Guide to Hospital Cover: What To Expect From Your Coverage

Posted: Apr 20 2022

While Australia has a universal public health insurance program, there is the option to add a private, supplementary insurance policy to extend coverage services. Citizens are automatically enrolled in coverage and receive assistance with physician services, public hospital care and pharmaceuticals. The national tax system funds the Medicare program, but those who pay for private insurance may avoid having to pay the Medicare levy surcharge. Here’s everything you should know about paying for hospital cover.

Comparing Medicare With Hospital Cover

With the standard Medicare coverage, services have limitations. Through Medicare, patients can be treated at no charge in a public hospital by a doctor who has been appointed by the hospital. You are not allowed a doctor of your choosing nor can you guarantee admission to the hospital as there may be a waiting list to navigate. There are some additional services that Medicare doesn’t cover:

  • Facility or emergency department administration fees
  • Services from the hospital or medical facility that are not clinically required
  • Ambulance services
  • Costs incurred by medical care or hospital stay overseas
  • Costs from a private patient hospital

These expenses could be taken care of with a private hospital cover policy, though there are additional reasons to purchase an independent policy for health insurance. Many consider the out-of-pocket expenses for a premium as a deterrent, but the idea behind the premiums is to avoid over-excessive spending when addressing the unexpected.

Service Options With Hospital Cover

Private hospital insurance acts like an oversized umbrella when a storm comes up. Though Medicare provides an adequate amount of financial peace of mind, there are limitations that can be difficult to overcome on limited funds. Private insurance creates a broader financial safety net but it also extends the areas of help. Though an extras policy would address general treatments, a hospital policy goes into effect with a hospital stay. The first benefit is the option of choice. Policyholders are able to choose from a public or private hospital to be treated.

Policyholders are also able to use a hospital policy to address treatments that are elective or non-emergency. Private insurance also allows patients to avoid the waiting list and potentially have access to a private room when using a public hospital. Patients using private insurance also have the freedom to choose the doctor who will be treating them. Under a hospital policy, the following conditions or services may be eligible for coverage:

  • Joint reconstruction
  • Appendix or hernia
  • Ear, nose and throat conditions
  • Reproductive system surgeries (male or female)
  • Radiotherapy, chemotherapy or immunotherapy for cancers
  • Dental surgery
  • Brain and nervous system

There are different options with hospital insurance, and depending on your anticipated health needs, extended coverage could be added for back, neck or spinal conditions; heart and vascular systems; pregnancy services; and more.

Eligibility Conditions With Hospital Cover

While private health insurance opens new doors for treatments, a waiting period may be required before treatment or services are covered. Though these are not required by law, there are restrictions on how long the waiting period can be for hospital services. These restrictions include a maximum of 12 months for pre-existing conditions; 12 months for birth-related or pregnancy benefits; two months for palliative, rehabilitation or psychiatric care; and two months for any other service.

Your policy will contain the specifics of any applicable waiting periods. If you change insurers or policies, the waiting period can’t be extended if you are carrying over the same cover or downgrading. If you have lowered your excess or have upgraded, it is likely that you will be required to follow a new waiting period based on the difference in cover.

Ambulance Cover

Even though Medicare assists with the cost of a public hospital stay, there is no general coverage for ambulance expenses across the country. For the Australians left to pay for their own ambulance services, the charges vary across the country. The average cost is around $1,200 for emergency transport. There are different prices for emergency versus non-emergency services, and maximum charges have been established.

Accident Cover

Unfortunately, accidents in life can leave you seriously injured and require significant medical attention. Medicare can help with the expenses of same-day surgery or care, but there will be limitations on what is paid for. There are many hospital cover policies that also include accident cover, and the waiting period for benefits to be paid must only be one day. Treatment must also be sought within 24 hours to seven days of the accident occurring, depending on your chosen policy. Many accidents require ambulance transport, rehabilitation, palliative care or even psychiatric treatment.

  • Palliative care improves the quality of life for individuals who live with a serious illness by providing specialized medical care
  • Rehabilitative services could include physical therapies, physiology services or prosthetic appointments

Financial Benefits

The benefit of reduced out-of-pocket expenses is just one of the financial perks of purchasing private hospital cover. The Australian government has put forth two incentives for purchasing private hospital insurance.

Lifetime Health Cover Loading

The government encourages additional insurance by adding a 2% loading to the hospital cover premium for anyone over the age of 31 who doesn’t maintain the cover. This is called the Lifetime Health Cover loading. Residents can avoid this excess by taking out cover by July 1st following their 31st birthday. There are a few exemptions of the LHC loading, namely those who were born on or before July 1, 1934, and some veterans or members of the Australian Defense Force.

Medicare Levy Surcharge

In addition to the potential for an additional 2% loading, high-income earners who don’t have private hospital cover pay an additional 1% to 1.5% tax. The tax starts at $900 for singles each year and increases with earnings. Purchasing an insurance plan could potentially lower this tax bill.

Hospital Cover Expectations

By purchasing hospital cover, you can expect some financial relief during unplanned medical events and have greater access to the medical care you want. With Health Partners, there are a number of plans available to suit every age range, budget and medical need. Find peace of mind during your moment of illness or injury with a private insurance plan that addresses the rising costs of medical care.

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Posted: Apr 20 2022


The information contained here is of a general nature and does not take into account your personal medical situation. The information is not a substitute for independent professional medical advice and is not intended to diagnose, treat, cure or prevent any disease or used for therapeutic purposes. Should you require specific medical information, please seek advice from your healthcare practitioner. Health Partners does not accept any liability for any injury, loss or damage incurred by use of or reliance on the information provided. While we have prepared the information carefully, we can’t guarantee that it is accurate, complete or up-to-date. And while we may mention goods or services provided by others, we aren’t specifically endorsing them and can’t accept responsibility for them.

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