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General Information
General Information
- What Medicare provides
- When you are a private patient in a hospital
- What private health insurance covers
- Your options as a privately insured patient
- Health insurer arrangements to cover 'the gap'
Health care can be expensive. As the basis of Australia's health care system, Medicare covers many health care costs. Private health insurance provides additional cover for some services not covered by Medicare
What Medicare Provides
Australia's Medicare system is available to all permanent residents. Norfolk Island does not participate in the Medicare program; however Australian citizens who have been living in Australia and move to Norfolk Island from the mainland will be eligible for Medicare on return visits for up to a period of five years. The Medicare system has three parts: hospital, medical and pharmaceutical.
Hospital
Hospital treatment includes treatment provided in a hospital setting as well as treatment outside of hospital premises, such as in an aged care facility or in a patient’s residence, as long as these services are co-ordinated and provided by a hospital. Hospital costs relate to a range of services including hospital accommodation, theatre fees and intensive care.
If you choose to be a Medicare (public) patient, you can be treated, at no charge, in a public hospital by a doctor appointed by the hospital. You cannot choose your own doctor.
When you are a private patient in either a public or private hospital, you will be charged for the hospital accommodation and other hospital services you receive. These charges are likely to be lower if you are treated by a hospital outside the hospital’s premises. Private health insurance may cover some or all of these charges.
Medical
As a public patient being treated by a public hospital, your medical costs will be covered under Medicare. If you are a private patient receiving treatment from a hospital, Medicare will cover you for 75% of the MBS (Medical Benefits Schedule) fee. Private health insurers have arrangements in place which may cover some or all of the doctors’ fees for your hospital treatment. Unless your private health insurer has a gap cover arrangement in place with your doctor which will cover all of your doctor’s charge, you may have to contribute towards the doctor’s bill out of your own pocket.
Pharmaceutical
Under the Pharmaceutical Benefits Scheme (PBS) you pay only part of the cost of most prescription medicines purchased at pharmacies. The rest of the cost is covered by the PBS. If the pharmaceutical is not ‘supplied’ on the PBS then private health insurers can choose whether to pay a benefit.
Ambulance Cover
Medicare does not cover the cost of emergency or other ambulance services. Ambulance cover arrangements differ between States. You should check what arrangements apply where you live. In States that do not offer universal ambulance cover for residents, you can arrange ambulance cover through the ambulance authority in your State and/or your health insurer.
Private health insurers may pay or reimburse you for all or part of your annual subscription to your State ambulance authority, or the costs associated with transportation. If you take out a hospital insurance policy in New South Wales or the Australian Capital Territory, you will find your private health insurance premium includes this cover. If you are a pensioner or a low income earner in these two States, your premium may be reduced because you are entitled to free ambulance cover.
When you are a private patient in a hospital
As a private patient - whether you are insured or not - you have the right to choose your own doctor, and decide whether you will go to a public or a private hospital that your doctor attends. You may also have more choice as to when you are admitted to hospital.
As a private patient, in either a public or private hospital, you may need to pay some or all of the costs for a range of services such as:
- hospital accommodation;
- theatre fees;
- intensive care;
- medications, dressings and other consumables;
- prostheses (surgically implanted);
- diagnostic tests;
- doctors' services.
Treatment as a private patient in a private hospital can be very expensive. Private health insurance will cover some or all of these costs.
What private health insurance covers
If you have private health insurance, you are covered against some or all of the costs of being a private patient in either a public or private hospital. Alternatively, you are free to choose to be treated as a public patient in a public hospital, at no charge.
There are many private health insurance policies to choose from. These policies will cover either some or all of the cost of your hospital care and allow you to choose your own doctor or specialist.
With private health insurance, you may insure against some or all of the costs of health services not covered by Medicare, such as:
- hospital expenses (theatre fees or accommodation) in either a public or private hospital;
- some or all of the medical costs Medicare does not cover;
- dental treatment;
- ambulance;
- chiropractic treatment;
- home nursing;
- podiatry;
- physiotherapy, occupational, speech and eye therapy;
- glasses and contact lenses;
- prostheses; and
- other general treatment services (previously known as ancillary or extras).
You can purchase insurance for general treatment benefits on its own or together with hospital insurance. Ask any private health insurer for details of their policies.
Your options as a privately insured patient
Health insurer arrangements to cover 'the gap'
The ‘medical gap’ is the difference between the doctor’s fee for services provided in hospital and the combined Medicare benefit and health insurance benefit. Unless your health insurer has a gap cover arrangement in place with your doctor to cover all of your doctor's charge, you will have to contribute towards the cost of the treatment out of your own pocket.
Health insurers are able to negotiate agreements with hospitals to fully or partially cover other charges related to hospital treatment, such as accommodation.
It is important that you contact your health insurer before you receive hospital treatment to check whether the insurer has an agreement with your hospital and whether your doctor is participating in the insurer's gap cover arrangements. You should also ask your doctor(s) and hospital for an estimate of their costs and how much will not be covered by your health insurer. Your health insurer should also be able to assist with calculating likely out-of-pocket costs.
Hospitals that have agreements with health insurers submit to the insurer a single account for hospital services provided. Doctors participating in gap cover arrangements with health insurers also usually forward all accounts to the insurer. If you have a policy that requires you to pay part of the hospital or medical costs, the hospital or doctor will bill you directly.
Hospitals that have agreements with your health insurer and doctors participating in your insurer's gap cover arrangements should, whenever possible, inform you before providing a medical service in hospital, of any amount you will have to pay.
You should be aware that if you have a health insurance product that has an excess or co-payment provision you will have to pay some of the cost of hospital treatment out of your own pocket even if your hospital has an agreement with your insurer and your doctor is participating in the insurer's gap cover arrangements. Further information on excesses and co-payments is provided in the section 'Types of health insurance cover’.
If you have any problems or complaints that cannot be resolved satisfactorily with your health insurer, you can have the problem fully examined by the Private Health Insurance Omsbudsman. You should always try to resolve the problem with your insurer before going to the Ombudsman.
