Staying fit and well
If you get sick or need ongoing medical treatment, the last
thing you should worry about is how to pay the bills. Private
health insurance can help reduce the cost of hospital fees and
other expenses, so you can focus all your energies on getting
Why private health insurance
Private health insurance can help you pay hospital and medical
costs not covered by Medicare. If you don't have private health
insurance, it can cost you a lot of money if something
goes wrong and you have to undergo prolonged medical
Choosing a private health
Look for a policy that includes the health and medical services
that you want. Most insurers provide a range of policies. To
find out what different insurers offer, read the Standard
Information Statement. You can compare all registered private
health insurers (or health funds) at www.privatehealth.gov.au.
As with all insurance, always look out for the exclusions when
comparing health funds. Private health cover often excludes claims
that relate to pre-existing conditions and specific things like
plastic surgery. There will also be restrictions about how much you
can claim and waiting periods may apply for specific types of
claims including obstetrics and major dental work.
Avoiding the Medicare Levy Surcharge
Generally, all Australians pay the Medicare levy of 2% of their
income as part of their tax. If you earn over a certain amount and
don't have private health insurance, you may pay an additional
Medicare levy surcharge of 1%, 1.25% or 1.5%. That's up
to 3.5% of your total income.
If you're on a high income it may be cheaper to buy the
insurance than pay the surcharge. For the latest figures and rules
around the Medicare levy surcharge and other tax issues relating to
health funds, see the Australian Taxation Office's information on
the Medicare levy.
Be honest with your
You must be completely honest if you make a claim or
if your circumstances change. Failing to 'tell it like it is' means
you may not be covered as your insurer may not honour any claims if
they find out you misled them.
Making a claim
Most health funds require you to make a claim within
2 years of an accident or illness. Be sure to check what time
limits apply to your level of cover and for different types of
Case study: Andrew's wise decision
Andrew was told by his
dentist that he needed his wisdom teeth removed. He rang his health
fund and was pleasantly surprised when they told him most of the
cost was covered by his insurance. That meant he could get the work
done straight away and not put it on his credit card.
Like all types of insurance, deciding whether to
buy private health insurance depends on your personal
circumstances. It's worthwhile taking some time to investigate the
potential benefits for you.
Last updated: 18 Apr 2017