Will Private Health Insurance Cover Everything?
When you do a simple health insurance comparison between public (Medicare) and private health insurance, it’s easy to see how the latter can supplement the former in terms of coverage. Private health insurance encompasses the benefits provided by the Medicare system, but can offer more as well. Of course, there’s no such thing as an insurance that “covers everything”.
As you may know, any type of policy will always have its exclusions and restrictions. Nevertheless the types of coverage available in private health insurance are wide enough to include what you would reasonably expect.
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Common coverage
These are the four areas of coverage that private health insurance can provide. Private health funds may offer them as separate policies, or combine them into packaged products that include all four. You’ll find that hospital and general treatment policies come in different levels of coverage. Top or comprehensive levels have the least number of exclusions and restrictions, while basic policies have all the common exclusions. Naturally, higher benefits and wider cover tend to result in higher premiums. Keep this in mind when you compare health insurance from the various companies and accredited health funds.
Hospital cover – A top level policy in this area would normally include all services that Medicare also covers. 75% of the costs of services listed in the Medicare Benefits Schedule (MBS) will be covered by the public health insurance system. The remaining 25%, which may include doctors’ professional fees or hospital accommodation, can be covered by your private health policy. You also have the choice to be treated as a private patient regardless of whether you’re in a private or public hospital. Unlike in Medicare, you can also choose your own doctor.
General treatment – There are certain treatments that are outside of Medicare’s scope or limited in benefit. Examples of such are dental, psychiatric, and optical treatments. It is in this area that private health insurance may be advantageous as this would be the only option to get coverage for such treatments. Other services for which you can get coverage through this type of policy are physiotherapy, chiropractic services, podiatric treatment, and prosthetics. General treatment cover is also sometimes called extras or ancillary cover.
Pharmaceuticals – Whether you have private health insurance or not, you only have to pay for the partial cost of certain prescription medicines listed in the Pharmaceuticals Benefits Scheme (PBS). The discount you receive depends on the type of medicine you purchase. Not all types of pharmaceuticals however are listed on the PBS. Thus you may arrange coverage for such medicine with your health fund and have it included in your policy. Usually a co-payment feature is used where pharmaceuticals are concerned.
Ambulance cover – This is another area which isn’t covered in Medicare. State governments such as those of Tasmania and Queensland have free ambulance services. The same is available in New South Wales and Australian Capital Territory but applies only to pensioners and those with low income. Generally, however, emergency and ambulance services are something that has to be either paid out of pocket or included in a private health insurance policy.
Broader health cover
Treatment doesn’t always have to be done in a hospital. Some services are available in healthcare clinics, while others can be done in the patient’s home. Then there are chronic conditions that need to be constantly treated and managed. These areas are not usually found in common private health coverage.
Fortunately, in April 2007, health funds began to devise health insurance products that would address such situations. Hospital substitute treatments are those done or continued outside of a hospital, and may include intravenous therapy or wound care, for example. Chronic disease management programs such as those for diabetes or cardiac conditions may also be covered by such policies. How these new coverage features are made available for contributing members is at the private health fund’s discretion.
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