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Types of Private Health Insurance Cover

Types of Private Health Insurance Cover

Hospital Cover

There are two types of private health insurance cover available:

  • hospital cover, and

  • general treatment (previously known as ancillary or extras) cover

 

Hospital Cover

Hospital cover helps with the cost of medical treatment such as hospital accommodation and doctors’ charges for hospital treatment services. This applies when you are receiving treatment from a public or private hospital. Depending on your hospital cover, it may also cover the payment of benefits for treatments in other settings agreed with your insurer, when they are coordinated by a hospital.

There are various types of private health insurance hospital cover that you can purchase. Some health insurance policies will give you full cover against the costs of hospital accommodation and in-hospital medical charges. Others, for which you will pay lower premiums, will require you to meet part of the costs. You can elect to pay a lower premium in return for agreeing not to be covered for some conditions, or to only receive limited benefits for a certain condition, or to pay a set amount towards the cost of your hospital treatment.

 

Hospital Cover

You could elect to pay a lower premium and take out a hospital cover policy with one or more of the following features:

  • an exclusion for a particular condition or conditions

If your policy features an exclusion for a particular condition, you are not covered for treatment as a private patient in a public or private hospital for that condition. For example, if you purchase a private health insurance policy that excludes maternity, hip replacements and knee replacements, and you go into hospital as a private patient for one of these conditions, your health insurer will not pay any benefits towards your hospital and medical costs.

If you are unsure which conditions are excluded on your policy you should ask your health insurer.

  • a front-end deductible (also known as an excess)

An excess is an amount of money you agree to pay for a hospital stay before health insurance benefits are payable. For example, if your policy has an excess of $200, you will be required to pay the first $200 of your hospital costs should you go to hospital as a private patient. An excess could apply every time that you go to hospital in a year, or it may be capped at a total amount that you will have to pay in a year. If you are unsure how the excess on your policy works you should ask your health insurer.

  • a co-payment
    With a co-payment, you agree to pay an agreed amount each time a service is provided. For example, a policy may have a co-payment clause that requires you to pay the first $50 for each day’s hospital accommodation. If your policy has such a co-payment and you were in hospital for 5 days, you would have to pay $250 ($50 x 5). The total amount of co-payment you can pay in a year is often limited to a set maximum amount.

  • restricted benefits
    If your policy has restricted benefits for some conditions you will be covered for treatment as a private patient in a public hospital for these conditions, but will face considerable out-of-pocket costs if you were to be treated in a private hospital for these conditions.

    If you are unsure about whether restricted benefits apply to your policy you should ask your health insurer.

  • a benefit limitation period
    A benefit limitation period is where you are only entitled to limited benefits for a particular condition or treatment for a set period of time. After that period of time has elapsed you would normally be entitled to full benefits for the condition or treatment. Some benefit limitation periods may commence after standard waiting periods have been served.

    If you are unsure about whether a benefit limitation period applies to your policy you should ask your health insurer.

  • public hospital table
    Some health insurers offer policies that have restricted benefits for all conditions. This policy is sometimes called a public hospital table. Under this policy you will be covered for treatment as a private patient in a public hospital, but will face considerable out-of-pocket costs if you were to be treated in a private hospital.
  • hospital-substitute treatment
    medical, surgical, therapeutic, diagnostic or other services intended to manage a disease, injury or condition. You should discuss with your doctor if this type of treatment is an option for you. Health insurers can cover chronic disease management programs and other types of services outside of the hospital setting.
General treatment cover

General treatment cover (also known as ancillary or extras) can assist with the cost of treatments such as physiotherapy, optical treatment and dental treatment as well as costs associated with disease management and prevention programs, depending on your insurer’s policy.

Packaged products

You are able to take out either hospital or general treatment cover on their own, and most health insurers offer packaged products that provide cover for both hospital and general treatment services.

NOTE: You should regularly review your health insurance needs in case you change your mind about whether you want to be covered for particular conditions, or your circumstances change, and you therefore need to upgrade your cover.