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How do private health funds work?

If you are confused about the private health care industry in Australia, you are definitely not alone. There is a lot of information to sort through, and it can be quite confusing for those who are weighing up their options with regards to health care and health insurance.

However with a little bit of research, it will become much easier to understand the differences between public and private health insurance, so here is some information to clear things up.

Medicare vs. private health insurance

The Australian government allows every citizen as well as some visitors from overseas to take part in the Medicare program. This public health program allows residents to make regular, in-hospital appointments at public health facilities. It also covers 100% of the Medical Benefits Schedule (MBS) fee for a visit to a general practitioner, though it is quite common practice for most GPs to charge a GAP fee above the covered amount, which is at the doctor’s discretion.

Under Medicare, patients who need to visit public hospitals will have their expenses covered or will receive reimbursement for the majority of their out-of-pocket expenses, with money from the government funded scheme.

However, not all medical treatments are covered under public health care and some of the ones that are not covered will surprise you. For example, if you have to take an ambulance to the hospital, you may have to pay for it out of pocket if you don’t have a private health insurance plan that covers ambulatory services.

Other specialist appointments held outside of hospitals, such as physical therapy, cosmetic dentistry or chiropractic care, are not covered by Medicare, but private health insurance can help cover these services. There are often out of pocket expenses for specialist appointments though, also known as GAP fees, a fee above the amount covered by insurance that goes directly to the specialist themselves. This amount is also at the doctor’s discretion.

Finally, private health insurance gives policyholders the option to visit private hospitals for their regular treatments. It also allows you to choose your doctor, which is an option not open to you in the public system, which can lead to you being seen by registrars rather than fully qualified doctors.

Why choose private health insurance

In short, private health insurance is meant to be an affordable accompaniment to Medicare. It does not replace public health insurance, but rather adds to the benefits that are given to all Australian citizens.

There are many different types of private health insurance, so consider using a comparison website to help you narrow down your options and find the best fit.

Maryland Health Insurance Plan Federal Press A...

Maryland Health Insurance Plan Federal Press Announcement (Photo credit: MDGovpics)

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