The best seniors health insurance is the one that serves both your current and future needs.
There are many different health insurance products available today that cater for senior Australians. When considering your health needs, make sure to evaluate your current and future life stages to maximise the value of your cover.
The Australian government offers various incentives for holding private health insurance, including Lifetime Health Cover loading and the Medicare Levy Surcharge.
Lifetime Health Cover is an incentive for Australians to take out private health cover earlier, and keep it for their lifetime, while easing the financial burden of the public health system. Private insurers place a 2% loading fee on top of your premium for each year that you’ve been uninsured after 30 years of age – until a maximum of 70% loading. For example, if you haven’t ever held private health insurance, but decide to take out cover when you’re 35 years old, you will need to pay an additional 10% loading fee on top of your premium. Once cover is taken up, you have to pay this loading fee for 10 consecutive years – after this time, the loading fee disappears.
The Medicare Levy Surcharge is another way the government helps to reduce the cost of the Medicare system. This surcharge is an additional tax on the existing Medicare Levy tax. It is payable by high income earners who do not take out private health insurance. The surcharge amount depends on your income level, beginning at $90,000 for individuals and $180,000 for families. The good news? If you are covered by private health insurance, you won’t be liable for this surcharge.
The government also offers a tax rebate, depending on your age and income. This rebate helps to make private health insurance more accessible for those who most need it. For example, if you’re aged 73 years old and you have an annual income of $55,000, you could be eligible for a rebate of about 33% on your private health insurance costs.
What does Medicare cover?
Medicare is Australia’s public health care system, and covers various healthcare costs.
Medicare covers treatment in a public hospital as a public patient, provided by a doctor chosen by the hospital. Under Medicare, you will not be able to choose your own doctor, and you may be placed on a public hospital waiting list that dictates when you will be admitted to hospital
For medical costs, Medicare will reimburse you 100% of the Medicare Benefits Fee (MBF) for a visit to your General Practitioner (GP), and 85% of the MBF for a specialist appointment. Additionally, if your doctor sends your bill to Medicare directly (bulk-billing), you won’t have to pay any fees.
The table below is a quick guide to treatments that Medicare does and does not cover:
|Covered by Medicare||Not covered by Medicare|
|Treatment as a public patient in a public hospital||Private patient hospital costs (including accommodation or theatre), medical and hospital costs incurred overseas and ambulance services|
|Consultation fees for doctors, including specialists and GPs||Examinations for life insurance, superannuation or memberships for which someone else is responsible (for example, a compensation insurer, employer or government authority)|
|Tests and examinations by doctors needed to treat illnesses, such as x-rays, MRIs and pathology tests||Medical and cosmetic services which are not clinically necessary or for cosmetic purposes|
|Eye tests performed by optometrists||Glasses and contact lenses|
|Most surgical and other therapeutic procedures performed by doctors in a public hospital or clinic||Hearing aids and other appliances|
|Some surgical procedures performed by approved dentists||Most dental examinations and treatment|
|Specific items under the Cleft Lip and Palate Scheme||Most physiotherapy, occupational therapy, speech therapy, eye therapy, chiropractic services, podiatry or psychology services|
|Specific items under the Enhanced Primary Care (EPC) program||Acupuncture (unless part of a doctor's consultation)|
|Specific items for allied health services as part of the Chronic Disease Management Plan||Home nursing|
Elective vs emergency surgery
Emergency surgery is surgery which requires attention within 24 hours. In an emergency, you will most likely go to the emergency department that is closest to you, most of which are in public hospitals. Emergency surgery, where you’re treated as a public patient, is covered by Medicare.
Elective or non-emergency surgery is surgery which could be deemed medically necessary, but could be delayed for 24 hours or more. For elective surgery, you need to be referred by your GP to a surgeon, who will then decide whether or not you need surgery, and how urgent your need might be. For this, you can choose to be treated as a public or a private patient.
If you need elective, or non-emergency surgery, and you are treated as a public patient, you will most likely be placed on a waiting list, and assigned a surgeon by the hospital or your GP. Patients on a waiting list are seen in order of severity of their condition, and you will have little control over when your surgery is scheduled. More urgent patients may be slotted into this list ahead of you – even if you’ve been waiting for longer.
If you choose to be admitted as a private patient, you can bypass this public waiting list and choose your specialist doctor or hospital. Upon review of your condition, if your specialist decides that surgery is required, you will book a date for surgery.
If you have decided that private health insurance is right for you, consider your options.
When you’re considering your healthcare needs for the future, think about whether or not you’ll require hospital cover or extras, or a combination of both.
Hospital cover means you’ll be eligible for reimbursement for some or all of the cost of being admitted to hospital as a private patient, including accommodation in a public or private room and theatre costs. Different levels of hospital cover offer coverage for different types of hospital treatment.
While some people will use all elements of a Gold-level hospital cover, others might only require Silver, Bronze or Basic-level cover – which is why it’s really important to review the terms and inclusions of your policy carefully.
As part of recent changes to help consumers better understand their options with private hospital insurance, a four-tier system has been established with minimum requirements for cover:
- Basic hospital cover must provide restricted cover for rehabilitation, hospital psychiatric services and palliative care. This means that your insurer will pay a limited amount toward these treatments, and there will likely be some out-of-pocket costs for these treatments.
- Bronze hospital cover includes the same minimum requirements as the Basic tier, but with 18 additional categories. These 18 categories must be covered without restrictions.
- Silver hospital cover includes the same minimum requirements as the Bronze tier, but with an additional 8 categories.
- Gold hospital cover includes the same minimum requirements as the Silver tier, along with an additional 9 categories.
|Rehabilitation||Brain and nervous system||Heart and vascular system||Cataracts|
|Hospital Psychiatric Services||Eye (not cataracts)||Lung and chest||Joint replacements|
|Palliative Care||Ear, nose and throat||Blood||Dialysis for chronic kidney failure|
|Tonsils, adenoids and grommets||Back, neck and spine||Pregnancy and birth|
|Bone, joint and muscle||Plastic and reconstructive surgery (medically necessary)||Assisted reproductive services|
|Joint reconstructions||Dental surgery||Weight loss surgery|
|Kidney and bladder||Podiatric surgery (provided by a registered podiatric surgeon)||Insulin pumps|
|Male reproductive system||Implantation of hearing devices||Pain management with device|
|Digestive system||Sleep studies|
|Hernia and appendix|
|Miscarriage and termination of pregnancy|
|Chemotherapy, radiotherapy and immunotherapy for cancer|
|Breast surgery (medically necessary)|
|Diabetes management (excluding insulin pumps)|
The tiers help to make health insurance easier to navigate and understand, and ensures that policies are referred to in a standardised way from insurer to insurer. Insurers can add more categories or treatments to a policy, as per their customers’ needs. These policies will be named for the minimum tier they fulfill along with a plus sign or the word ‘plus’. For example, Bronze+ or Bronze Plus.
Generally, the higher the level of cover you’re looking for, the higher the premium.
Ensuring you’re only paying for things you’ll use or need means you’re ensuring you’ll get the maximum value possible from your health insurance.
If you’re aged over 65, you might require cover orthopaedic surgery, ambulance services, heart surgery and rehabilitation, but coverage for pregnancy might not be necessary.
Extras cover is for non-emergency medical or general treatment, or treatment where you are an outpatient in a hospital.
Extras cover might include physiotherapy, podiatry, dental, chiropractic, speech therapy, optical, prostheses, occupational therapy and home nursing. For a full list of General treatment services, visit the PrivateHealth.gov.au website.
Different policies offer different levels of coverage, and you will need to carefully consider what you need in order to get the best value. For example, you might not need cover for prosthetics or speech therapy, but you might visit your dentist and physiotherapist regularly. Your insurer may also place a limit on the number of times you can claim for a particular treatment each year.
Q – Do both Medicare and private health insurance cover cancer treatment?
Whether or not you have private health cover, Medicare will cover a large portion of the costs when it comes to cancer treatment. Medicare provides rebates for some outpatient services which might not be included in private health cover policies, such as GP visits, blood tests, MRIs and CT scans, biopsies and specialist consultations. However, Medicare does not cover some medications for cancer treatment that your doctor may prescribe
Private hospital insurance of Bronze level or higher covers cancer treatment and allows you to choose your own doctor and stay in a private room if you wish.
The Pharmaceutical Benefits Scheme
The Pharmaceutical Benefits Scheme (PBS) is a government-run program which helps to reduce the cost of some prescription medicines. All Australian residents with a Medicare card are eligible to receive benefits from the PBS.
However, not all medications are listed under the PBS. Some private extras insurance policies include medication or prescriptions that might not otherwise be included in the Pharmaceutical Benefits Scheme under Medicare.
No matter your choice, review your health care needs regularly.
To get the most value, and the best health insurance, ensure you’re covered only for what you need or use, and consider what your future needs could be.