Don't get caught out by fine print. What you need to know about health insurance exclusions and restrictions.
Private health cover is an essential consideration for every Australian. It offers protection against a wide range of medical costs, which means you get the medical treatment you need when you need it.
However, before you choose a health fund for your family, it’s important to make sure you’re aware of the health insurance exclusions and restrictions. Knowing what isn't covered by health insurance will help ensure you don’t get any nasty surprises in the form of out-of-pocket expenses not covered by your health fund.
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Is there a difference between a restriction and an exclusion?
Restrictions and health insurance exclusions are two terms that are often conflated but have different meanings.
- Health insurance restrictions. A restriction, also referred to as a restricted benefit, is a condition or service that a health fund covers, but only to a limited extent. This means that you will only be able to access reduced benefits for specific medical conditions you suffer or medical services you receive, so you will most likely have to cover some expenses out of your own pocket.
For example, if you’re admitted to a private hospital to receive care and treatment for a condition that your health fund offers restricted cover for, you will need to pay theatre fees, the balance of your accommodation costs, as well as other expenses that aren’t covered.
- Health insurance exclusions. An exclusion refers to a condition or service your health insurance doesn’t cover. This means your health fund won’t pay for any hospital or medical expenses for that condition or service. These costs will be your out-of-pocket expenses.
What procedures are typically restricted or excluded?
While each insurer will have its own restrictions and exclusions, the services and procedures listed below are commonly restricted or excluded by private health funds in Australia:
- Plastic and reconstructive surgery
- Cardiac and cardiac-related services
- Pregnancy and birth services
- Assisted reproductive services
- Hip and knee replacements
- Rehabilitation and psychiatric services
When will restrictions and exclusions affect you?
The lower the level of cover you have, the cheaper your health insurance premiums will be. This means you can save money if you choose a policy that restricts or excludes a range of conditions and procedures.
However, it’s also worth pointing out that it’s impossible to predict the future and the health changes that may occur. So if you require treatment in the future for something not fully covered by your policy, you may need to either cover extensive out-of-pocket expenses or serve a lengthy waiting period before you can get the treatment you need.
With this in mind, it’s essential that you check the health insurance exclusions and restrictions that apply to your policy, and then think carefully about your health needs to determine the level of cover you need.
Health insurance checklist
Keep the following tips in mind to make sure your health insurance provides the in-hospital coverage you need.
- Check your policy statement. The product disclosure statement (PDS) from your health insurer contains a large amount of information about the features and exclusions of your policy. Read the fine print closely and make sure you’re aware of any exclusions and restrictions that apply.
- Review cover regularly. Just as your life and your circumstances continue to change, so do your health insurance cover needs. What was adequate cover for you as a single 25-year-old may fall well short of offering the protection you need when you’re 30 years old, married and with a baby on the way. That’s why you should regularly review your policy and the cover it provides to make sure you have the right protection in place.
- Ask questions. Are you confused by the terms and conditions of your policy? Are you unsure about the level of cover you have in place? If so, never hesitate to ask your insurer for clarification about your policy.
- Speak to your doctor. If you don’t know which health services and procedures you might need cover for, ask your doctor. He or she will be able to tell you everything you need to know to get the cover you need.
Are limits always listed?
Unfortunately, private health insurers don’t always clearly list the limits and restrictions that apply to your policy. For example, it can sometimes be hard to tell the difference between services that are fully covered and those that have restricted coverage in a benefits table. In addition, some policies will include statements such as:
Any services not shown as an inclusion or exclusion are limited to public hospital benefits
This is a statement that is easy to overlook if you don’t know what you’re looking for.
Make sure to read all policy documents closely and if you’re unsure about anything, ask your insurer for clarification.