Should You Have Private Health Insurance?
The Medicare system in Australia provides pretty broad coverage, so do you really need to spend your hard-earned money on private health insurance? Is it just a waste, or perhaps only for those with special needs and situations? Well, in a word, no. We’ll help you decide if the benefits for you outweigh the expense.
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Elective Surgery
Elective surgery procedures are those that are scheduled, versus an emergency surgery that is required suddenly and immediately. “Elective,” however, does not mean that these procedures are cosmetic or unnecessary. A hip or knee replacement is an elective surgery, as is a gall bladder removal or cataract removal.
The waiting list for such procedures can be long, and the surgeries themselves may be prohibitively expensive. A knee replacement, for example, may cost $13,000, which many people won’t be able to afford; no one wants to think about being in the terrible position of needing surgery but being unable to pay for it. Private health insurance, depending on your plan, may cover the cost of elective surgery. It can also allow you to choose your doctor and your hospital, and can shorten your wait before hospitalization.
But you can’t wait until you need surgery to purchase health insurance. You’ll need to have purchased the policy and served any waiting periods, which may be as long as a year, before you can make a claim.
But I’m Young and Healthy…
So, you say you’re young and healthy, and the only surgery you’re likely to need would be in an emergency, when Medicare will cover it? Besides, you say, you have no money to spend on extras. You’re trying to start your career and are barely paying your rent.
Well, that’s understandable. But once you’ve gained some stability, you’ll want to seriously consider getting private health insurance before you turn 30. That’s because the older you are, the more of a risk you present to an insurance company, and that means your premium goes up. You will pay up to 70% more for insurance by joining later than 30. Here again, it pays to have coverage before you need it.
Can I Save Money by Paying for Insurance?
Paying money to save money seems like a ridiculous idea, and a bad sales pitch too. But it can be true for some Australians. You see, the government has a number of tax incentives for those who purchase private health insurance. Whether they apply to you or not depends on your income, the policy you buy, what type of coverage it provides and how long you hold the policy.
The Power of Choice
Some people find the ability to choose their doctor or hospital is enough to convince them to purchase health insurance. Others want the extra comforts of a private hospital, such as the possibility of a private room or bathroom. And some may want additional or less conventional treatments and therapies to be open to them, such as physiotherapy or acupuncture. If you wear glasses or contacts, or need frequent dentist appointments, you can purchase insurance to cover these extras.
In the end, deciding to buy health insurance is largely about peace of mind. When it comes to insurance, if you wait until you need it to buy it, you’re too late. So, will you sleep better at night knowing your health needs are covered in the best way your money can buy? If the answer is yes, then it’s time to start shopping to the plan that’s right for you.
Useful Resources
DHHS on Elective Surgery (PDF)
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