How the Australian health system works
Australia has a uniquely mixed public and private health system that provides people with real choice.
Public health care in Australia is covered by Medicare, State Government funding and the Pharmaceutical Benefits Scheme (PBS) which makes medicines cheaper.
Private health care is funded through a combination of private health insurance benefits, the personal contributions of private patients and the Government rebate on private health insurance. The Government rebate goes to the policyholder, directly impacting their health insurance premiums.
The private system is designed so that those who can afford private health insurance in Australia can take personal responsibility for their health through guaranteed fast access to high quality care and their doctor of choice.
Insurance options include hospital cover for hospital treatment as a private patient, or general treatment (otherwise known as extras cover or ancillary cover) which includes dental cover, physiotherapy and optical services.
More than 44 per cent of Australians have private health insurance for hospital cover. As much as 53 per cent have ancillary or extras over to cover the costs of services such as dental, optical or physiotherapy. A dental insurance plan can cover anything from major dental procedures and gum disease to cosmetic dental work.
Why have private health insurance?
Over 14 million Australians benefit from private health insurance cover – a product that provides peace of mind over fast access to the best available health care with their doctor of choice.
Having private health insurance means you can take greater control over your own health with fast access to treatment, the freedom to choose your preferred surgeon, and optional coverage for extras like ambulance, dental, optical, physiotherapy, remedial massage or chiropractic treatment depending on your level of cover.
Public hospital waiting periods can extend well beyond a year for many procedures. So having private health insurance not only means you skip those waits, but also help take pressure off the overstretched public system by freeing up beds for those that need them most.
Having hospital cover also means you could avoid paying both the Medicare Levy Surcharge and Lifetime Health Cover (LHC) loading, leaving you financially better off than if you didn’t have private cover.
What about overseas visitors?
If you’re visiting from the United Kingdom, Sweden, Belgium, Finland, Italy, Malta, the Netherlands, Slovenia, the Republic of Ireland, Norway or New Zealand, you usually have access to Medicare thanks to a reciprocal health care agreement with Australia. This means Medicare covers emergency treatment in the public health system for free.
For other visitors to Australia and those looking for private cover, you can get Overseas Visitors Health Cover (OVHC) which insures you against any medical or hospital expenses if you need treatment. Students can get Overseas Student Health Cover (OSHC).
What about ambulance cover?
Ambulance costs and call out fees are not covered by Medicare and are treated differently in almost every state. Ambulance is covered under some extras policies and also under some hospital policies.
Gold, Silver, Bronze and Basic hospital cover
All hospital insurance policies are classified as Gold, Silver, Bronze or Basic.
What is, and is not, covered in these tiers is based on minimum standard categories of treatment. These standard categories simply represent what hospital treatments are, and are not, covered under each policy. Each standard category—for example, ‘bone, joint and muscle’ category, or ‘heart and vascular system’ category—sets out the hospital treatments that must be covered by your private health insurer. If a policy covers a certain category, then it must cover everything listed in it—not only some things.
To ensure they comply with these new tiers, private health insurers placed their policies into one of these tiers—Gold, Silver, Bronze or Basic. Insurers offer additional coverage above the minimum requirements in Basic Plus (+), Bronze Plus (+) and Silver Plus (+) tiers.