Health insurance for prostheses
Health insurance will cover your prosthetic device if it's part of a covered treatment and if the device is on the government's official Prostheses List.
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When a private health insurance policy says it covers a treatment like heart surgery, that means it automatically covers any artificial body parts that are needed for that treatment. So if you want to know if you're covered for prostheses, you'll have to find out what type of prosthetic device you'll need and what type of surgery is required to implant it.
The device also needs to appear on the Australian government's Prostheses List, a list of more than 11,000 devices vetted by the government which includes hip, knee or shoulder joint replacement devices, pacemakers and much more.
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Health insurance for prostheses: how Australian health funds cover you
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What are prostheses?
Prostheses is the plural form of prosthesis, or an artificial body part. Examples include anything from an artificial leg to an artificial heart to metal screws and plates that reinforce the skeleton.
What is the difference between a prosthesis and a health appliance?
The phrase health appliance is a catch-all term that includes artificial body parts like prostheses but also includes sensory aids like eyeglasses and medical devices like blood pressure monitors. Unlike prostheses, these other appliances support rather than replace body parts.
Health Appliances = Prostheses + Sensory Aids + Medical Devices
This guide focuses on the prosthesis category specifically.
How are prostheses covered by Medicare?
Finding prosthesis cover is a mixed bag in the public system and you may have to go one of several routes for your cover depending on the situation.
If your prosthesis is a crucial part of a Medicare-approved treatment, the device is included in your Medicare cover automatically. For example, if you're getting a hip replacement, the cost of the artificial hip is covered in addition to the surgery itself.
If you need an artificial limb, Medicare won't help since artificial limbs aren't required for a successful amputation. Luckily, there are other forms of public assistance that can help with the cost of an artificial limb:
- Your state's public health system. Many states cover artificial limbs as long a doctor refers you, you're a resident of the state and you have a valid Medicare card.
- Department of Veteran Affairs. If you lost your limb while serving or you have a Gold Card, you will be eligible for cover through the Department of Veteran Affairs.
- The National Disability Insurance Scheme (NDIS). If you can't find cover elsewhere, you can apply through the NDIS. However, their eligibility criteria is stringent and requires you to demonstrate that an artificial limb will offer "value for money" in relation to your ability to function in your local economy.
If your prosthesis is for cosmetic purposes only you won't find public cover. For example, the public system won't cover breast implants unless it's to reconstruct your breasts after a mastectomy.
Does private health insurance cover prostheses?
Yes. Just like Medicare, your private hospital insurance will cover the cost of your prosthesis as long as it forms part of a treatment listed on your policy.
There are a few benefits to using private cover for prostheses:
- You skip the waiting lists. If your treatment isn't urgent, Medicare will make you wait for your treatment. Private insurance lets you skip the queue so you can get the treatment you need sooner. If you need a shoulder replacement and are in constant pain, you probably don't want to wait too long to get it fixed.
- You get to choose your doctor. With Medicare, you have to use who they tell you to use. Private insurance lets you choose the doctor you're most comfortable with.
- You can get extra physio. Medicare will cover in-hospital physio but won't cover outpatient treatment. Some extras policies will cover outpatient physio, which is important if you need to regain your range of motion following an implant.
What is the Prostheses List?
The Prostheses List is the Australian government's official list of more than 10,000 surgically implanted prostheses and other devices required for the implants to function.
It's basically a list of vetted products, down to the brand and model number in some cases. If your private health insurance covers a particular treatment requiring prostheses, your private doctor must use a device on this list and your insurer must reimburse you the minimum benefit amount, which is also included in this official list.
The government updates the list three times a year to keep up with the never-ending improvements in medical technology. Having a regularly updated list of properly vetted devices helps keep insurance costs down since it reduces the chance of follow-up surgery due to malfunction.
What items are on the Prostheses List?
Items on the Prostheses List are broken up into several categories:
- Ear, nose and throat
- General/miscellaneous products (prostheses not included in other categories)
- Plastic and reconstructive
- Specialist orthopaedic
The latest version of the Prostheses List is available from the Department of Health website.
How do you find prosthesis cover in the new Gold, Silver and Bronze tier system?
Prostheses can be used in all sorts of treatments, from basic treatments all the way to highly complicated ones. That means you'll be covered for prosthesis based on the type of treatment rather than whether or not prosthesis is involved. For example, if your policy covers heart surgery but not hip replacements, you'll be covered for a pacemaker but not an artificial hip.
In April 2019, insurers will roll out a simplified and standardised tier system for their policies. All products in the market will fall into one of the following levels Gold, Silver, Bronze and Basic.
The level you choose will determine what treatments you are covered for and therefore what prostheses are covered.
Here are examples of some treatments you'll find at each level and an example of a prosthesis that's included:
- Basic. Insurers are allowed, but not required, to offer you restricted cover that will pay for the prosthetic device but not for the surgery to implant it. However, in most cases, there will be no cover for any treatments that would require a prosthesis.
- Bronze. Offers bone, joint and muscle cover (bone screws) and medically necessary breast surgery (reconstructive breast implants following mastectomy).
- Silver. Offers all of the above plus heart and vascular system cover (pacemaker); back, spine and neck cover (vertebrae replacement) and hearing implant cover (middle ear implant)
- Gold. All of the above plus joint replacement cover (artificial hip) and insulin pump cover (insulin pump cover is separate from diabetes cover).
What is a no-gap prosthesis?
Most devices on the Prostheses List are considered no-gap prostheses, meaning your insurer has to cover the full cost of the device. There are some gap-permitted prostheses you can be charged for, but for every gap-permitted device, there is an equivalent no-gap device also on the list. Feel free to ask your doctor to use the no-gap version if you are concerned about cost.
The gap-permitted items on the list will have an amount listed in the maximum benefits column in addition to the minimum benefits column. If the maximum benefits column is blank, it is a no-gap prosthesis and you won't be charged any extra for it.
Are there any other out-of-pocket expenses?
With private health insurance, you usually won't pay out-of-pocket for the device itself but you may see some out-of-pocket charges related to the surgery.
When you use private health insurance in a private hospital, Medicare and your insurer team up to pay the Medicare Schedule Fee for that treatment (ie, what Medicare alone would have paid had you gone public).
But private doctors are free to set their own prices leaving you responsible for any difference. This is called your gap. The good news is you can avoid some or even all of this gap if your insurer offers an Access Gap Cover scheme in which certain doctors agree to lower their prices for the fund's members.
2019 Health Insurance reforms changes to prosthesis benefits
The 2019 Health Insurance Reforms include changes to the way private health insurers handle prosthesis benefits, with the first changes actually taking effect in 2018 and more on the way throughout 2019 and 2020.
Thanks in part to an agreement with the Medical Technology Association of Australia, the Australian government secured reduced pricing for prosthetic devices on behalf of the private health insurance industry.
With the savings secured, the government was able to reduce the minimum benefits payable for most devices on the Prosthesis List on 1 February 2018. Further reductions will take place on select devices throughout 2019 and 2020, with all savings being passed to consumers in the form of lower premiums.
The government has also announced that it will publish the list more often. In March 2019, the government began the list three times a year, up from two times a year prior to that.
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