Health insurance: FAQs about private health insurance answered

Do you have private health insurance questions? Find the answers you need here.

Private health insurance can be confusing at times. It's a process of weighing up how much you're wanting to spend with the benefits that a policy provides and then seeing how that policy compares with what else is in the market.

Questions people ask themselves when looking for cover range from "Do I really need private health insurance?" to "What is the Lifetime Healthcare Loading and how can I avoid paying it?"

This page goes through various health insurance questions consumers have during the process of choosing a policy, the types of cover, important terms and conditions, what policies cover and how to claim.

If you have any questions that aren't answered on this page, leave it in the comment section and we will do our best to answer it for you.

Choosing a policy

Question: Why do I need private health insurance?

  • While the Medicare affords Australians access to a wide range of subsidised healthcare services, it can fall short at times. Private health insurance about peace of mind, allowing you to choose your hospital and your doctor, enjoy shorter waiting periods for treatment, and receive cover for the cost of a range of treatments and services not included in Medicare.

Question: How do I choose a private health fund?

  • To find the right health fund, compare the cover options available from a range of health funds and determine whether or not they meet your needs. How much does each fund pay benefits and how much do they charge for cover? Also consider whether they have a good reputation for providing prompt customer service if you ever have a question or problem.

Question: How do I know which health cover is right for me?

  • You’ll need to carefully consider your health care needs before choosing a policy. Consider your health situation, your budget, whether you have any dependents, the level of cover you want and if there would be any out-of-pocket expenses. Once you know what type of cover you want, you can compare the policies available from a range of health funds to find one that meets all your cover requirements.

Question: What if I’m young and I don’t have many medical expenses?

  • Most private health funds offer cover options to suit people at your life stage. These entry-level policies are designed to offer basic cover for a selection of essential medical expenses, making them as affordable as possible.

Question: How can I switch from one private health fund to another?

  • All you have to do is tell your new fund the name of your previous fund and the level of cover you held with that fund. Your new fund will take care of transferring your membership over. If you’re applying for the same or a lower level of cover with the new fund, you will not have to re-serve any waiting periods.

Question: Does the cost of private health cover increase every year?

Question: Is there a cooling-off period?

  • Yes. Whenever you take out private health cover you have a period of time to change your mind, generally 30 days. If you decide to cancel cover during this period, you will receive a full refund of any premiums you've paid.

Types of cover

Question: What is the difference between hospital cover and extras cover?

Question: Can I get a policy that covers both hospital and extras cover?

  • Yes, you can choose pre-packaged cover that includes hospital and extras cover, or opt to mix and match your choice of hospital cover with your choice of extras cover from the same fund to create health insurance that suits your needs.

Question: How can I choose a level of hospital cover?

  • There are three levels of hospital cover available: basic, medium and top. Basic policies offer cover for a limited range of essential treatments and services but exclude several high-cost benefits. Medium cover offers a combination between a broad range of benefits and affordable premiums, while top cover is designed to offer ultimate peace of mind and cover an extensive range of treatments and services.

Question: What is ambulance cover?

What does health insurance cover?

Question: Does hospital cover pay for the cost of all my in-hospital expenses?

  • No. Many health funds won't cover in hospital expenses including telephone use, newspapers, physiotherapy and certain high-cost drugs.

Question: What are some of the services and treatments commonly included in extras cover?

  • Extras cover commonly include cover for general dental, optical, physio and chiropractic expenses. High-level extras cover adds other benefits such as major dental, orthodontic, exercise physiology, occupational therapy, psychology, osteopathy, remedial massage, speech pathology, immunisations and health management programs.

Question: Where can I see a list of general exclusions?

  • You can see a list of situations and events when your health fund won’t offer any cover in your member guide or product disclosure statement (PDS).

Question: What are some situations where I won’t be covered?

  • Some common exclusions from private health cover include services and treatment provided outside Australia, cosmetic surgery that is not medically necessary, and treatment received from a relative.

Question: Can I take out health cover for my whole family?

Question: Can I change my level of cover?

  • Yes. You can change your level of private health cover at any time. However, you may need to serve additional waiting periods if you upgrade your cover.

Important terms and conditions

Question: What is a pre-existing condition?

  • A pre-existing condition is any illness, injury or condition that produced signs or symptoms in the six months before you took out private health cover. Note that you will need to serve a waiting period after you join a health fund before any cover will be available for medical costs that arise due to your pre-existing condition.

Question: What is the Australian Government Rebate on private health insurance?

  • This rebate is offered by the government on your health insurance premium to help make it more affordable to take out cover. The rebate you are eligible to receive varies depending on your income and age, and it is available to Australians registered for Medicare who hold, hospital, extras or ambulance cover.
    The rebate levels applicable from 1 April 2018 to 31 March 2019 are:


    < Age 65
    Age 65-69
    Age 70+
    < Age 65
    Age 65-69
    Age 70+

Question: What is the Medicare Levy Surcharge?

  • This Australian Government Medicare Levy Surcharge (MLS) initiative applies to high-income earners who don’t have private hospital cover. The extra 1%-1.5% levy is charged at tax time.

    Medicare Levy Surcharge (MLS)

    All ages
    All ages

Question: What is Lifetime Health Cover?

  • Lifetime Health Cover (LHC) is an Australian Government initiative that aims to encourage Australians to take out hospital cover earlier in life and keep that insurance in place. If, on July 1 following your 31st birthday, you do not have hospital cover in place with a private health fund, you will have to pay extra for your health insurance premiums when you do decide to take out cover. You’ll need to pay a 2% loading on top of your health cover premiums for every year you are aged over 30 when you first take out cover.

Question: Question: What are waiting periods?

  • A waiting period is the amount of time you must wait after taking out cover before you are eligible to receive a benefit. Different waiting periods apply to different benefits, including treatment of pre-existing conditions, pregnancy services and dental treatment.

Question: What are restrictions?

  • When a restriction applies to a benefit on your policy, it means that a certain treatment will be covered but only to a limited extent. For example, you may only be covered for the cost of a certain medical procedure performed as a private patient in a public hospital.

Question: What is an inpatient?

  • An inpatient is a person who is admitted to hospital.

Question: What is a co-payment?

  • Some policies also feature a hospital co-payment, which is similar to an excess but requires you to make an additional payment when you are admitted to hospital. A co-payment will usually apply for each day of your stay, up to a certain limit of days, while accepting a co-payment option entitles you to lower premiums.

Question: What are non-PBS pharmaceuticals?

  • The Australian Government’s Pharmaceutical Benefits Scheme (PBS) subsidises the cost of certain drugs, which means they are available to members of the public at a lower cost. If your health fund says it covers the cost of certain non-PBS pharmaceuticals – ie, those that do not appear on this list – it’s a good idea to check out exactly which pharmaceuticals are covered.


Question: How do I lodge a claim under hospital cover?

  • In the majority of situations, your health fund will liaise with the hospital to ensure that your medical bills are paid. However, if you receive a bill for your doctor for medical treatment you received while in hospital, you’ll need to lodge a medical claim with Medicare first before submitting the details to your private health fund.

Question: How do I make a claim under extras cover?

  • In many cases you will be able to take advantage of on-the-spot electronic claiming through the HICAPS system when you visit your treatment provider – all you have to do is swipe your private health fund membership card. However, if this service is not available, you can typically submit your claim via email, post or fax.

Question: What is an excess and when will I need to pay one?

  • Many hospital cover policies feature an excess, which is the amount you need to pay if you are admitted to hospital. Agreeing to pay an excess entitles you to lower premiums, but there are some policies that do not require you to pay any excess if you are hospitalised.

Compare your options now with help from an adviser or go direct to a fund online

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