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Hospital cover in Australia
Private hospital cover helps pay for treatment in private hospitals, offering more flexibility and shorter surgery waiting lists. Cheap hospital cover starts from around $19 a week.
Hosptial cover helps pay for treatment in a private hospital.
Private hospital cover can help you avoid long public waiting lists for surgery.
The cheapest hospital cover can be found from around $18 a week.
Compare hospital cover from multiple funds
Here is a wide range of hospital policies from Finder partners. All prices are based on a $750 excess for a single earning less than $93,000 living in Sydney.
Hospital only health insurance lets you be treated at private or public hospital as a private patient – usually with your choice of doctor. Hospital cover also pays a share of your medical costs when you're admitted to the hospital, such as accommodation and theatre fees. Hospital cover can give you more flexibility as a patient, including access to shorter surgery waiting lists. It comes in 4 tiers: basic, bronze, silver and gold.
Hospital only
Hospital cover helps pay for treatment in a private hospital, and may help you save money at tax time.
Extras only
Extras cover will chip in for medical costs outside hospital, such as optical, dental, physio and chiro.
Combined
Combined policies have both hospital and extras coverage, offering the most comprehensive coverage available.
Pros and cons of hospital health insurance
Pros
With 4 tiers to choose from and dozens of health funds, it's possible find cover that's tailored to your individual needs.
With a hospital plan, you can swerve long elective surgery waiting lists at public hospitals.
Basic hospital policies can cost less than what you'd be hit with if the Medicare levy surcharge, a government levy, applies to you. Getting in early can also help you make premium savings due to the Lifetime Health Cover loading.
Cons
Top tier plans offer wide-ranging cover, but they can add more than $200 to your insurance bills each month. More basic plans come with limited perks.
Out-of-pocket costs still apply when the cost of your health service is more than the MBS item fee.
You can't usually claim for pre-existing medical conditions for the first 12 months of your policy. A pre-existing condition is any ailment you've suffered from within the 6-month period before your insurance starts.
What are the hospital health insurance tiers?
Each health insurance tier covers a standardised set of treatments. Here's a quick summary of each tier.
Gold hospital cover
Gold-tier hospital insurance covers all 38 treatments outline by the Australian government. This includes treatments such as joint replacements, pregnancy and insulin pumps, as well as all services covered by silver-tier policies. Typical cost: From around $160 a month for a single policy.
Silver hospital cover
Silver-tier hospital insurance covers at least 26 treatments outlined by the Australian government. This includes treatments such as dental surgery, lung and chest and podiatric surgery, as well as all services covered by bronze-tier policies. Typical cost: From around $115 a month for a single policy.
Bronze hospital cover
Bronze-tier hospital insurance covers at least 18 treatments outlined by the Australian government. This includes joint reconstructions, ear, nose and throat and gynaecology treatments, as well as all services covered by basic-tier policies. Typical cost: From around $80 a month for a single policy.
Basic hospital cover
Basic-tier hospital insurance isn't required to fully cover any treatments outlined by the Australian government, but it needs to have restricted cover for rehabilitation, hospital psychiatric services and palliative care. Basic cover is primarily used to avoid the Medicare Levy Surcharge and Lifetime Health Cover loading. Typical cost: From around $75 a month for a single policy.
Clinical category
Basic
Bronze
Silver
Gold
Rehabilitation
R
R
R
Hospital psychiatric services
R
R
R
Palliative care
R
R
R
Brain and nervous system
Eye (not cataracts)
Ear, nose and throat
Tonsils, adenoids and grommets
Bone, joint and muscle
Joint reconstructions
Kidney and bladder
Male reproductive system
Digestive system
Hernia and appendix
Gastrointestinal endoscopy
Gynaecology
Miscarriage and termination of pregnancy
Chemotherapy, radiotherapy and immunotherapy for cancer
Pain management
Skin
Breast surgery (medically necessary)
Diabetes management (excluding insulin pumps)
Heart and vascular system
Lung and chest
Blood
Back, neck and spine
Plastic and reconstructive surgery (medically necessary)
Dental surgery
Podiatric surgery (provided by a registered podiatric surgeon)
Implantation of hearing devices
Cataracts
Joint replacements
Dialysis for chronic kidney failure
Pregnancy and birth
Assisted reproductive services
Weight loss surgery
Insulin pumps
Pain management with a device
Sleep studies
Hospital health insurance and tax (the MLS and LHC)
There are 2 different government schemes that may cost you money if you do not have hospital cover.
Medicare Levy Surcharge
If you earn over $93,000 and don't have hospital cover, you'll be taxed between 1% and 1.5% of your wage due to the MLS. Get a cheap policy and you can avoid the tax.
For a lot of people, the cost of a hospital policy can actually be less than what they'd be taxed if they didn't have it. So even if you don't plan on using private health insurance, it can make financial sense to get a policy anyway.
Lifetime Health Cover loading
LHC loading kicks in on 1 July immediately following your 31st birthday. For every year you don't have health insurance from that date, you'll be charged an extra 2% when you eventually do decide to get a policy.
That means if you wait until you're 41, your premiums will be 20% higher than they would have been if you took out a policy before the deadline. Get life insurance before the deadline and you won't be hit with the penalty.
How does hospital cover work?
If you receive an in-hospital service as a private patient, Medicare typically covers 75% of the Medicare Benefits Schedule (MBS) fee. Your private health cover will pay the remaining 25%.
However, a doctor or specialist won't always stick to the MBS fee set by the government as a fair fee for a service or treatment. In this case, you'd have to pay an out-of-pocket fee known as "the gap".
Some insurers have deals with healthcare providers that mean all or some of the gap is covered by your health fund.
Hospital cover only helps with items that are on the MBS. If the treatment you want isn't on the MBS, you won't get help from private hospital cover.
Waiting periods for hospital cover
The main hospital covers and their waiting periods include:
Service coveredTypical waiting period
Emergency ambulance cover
1 day
Accidental injury benefit
1 day
Acute mental health treatment
2 months – a one-time waiver may apply
Rehabilitation
2 months
Palliative care (for life-limiting illnesses)
2 months
Pregnancy and birth
12 months
Pre-existing conditions
12 months
Waiting periods vary depending on your policy. The services listed here do not represent a complete list of services covered under all hospital policies. Depending on your fund and policy, you may find many other cover options to match your needs.
Pre-existing medical conditions within the first 12 months
Out of pocket costs (that's when your doctor charges more than the MBS item fee)
Fees for any specialists you see outside of hospital
Any services you receive outside of hospital
Any medical treatment that does not have an MBS item number
Hospital stays that are longer than 35 days
Cosmetic surgery for non-medical reasons
Frequently asked questions
Hospital only health insurance allows you be treated as a private patient at hospital, often with your choice of doctor. It's available in 4 tiers – gold, silver, bronze and basic – and pays a share of your medical costs when you're admitted to hospital.
There are a number of benefits to holding a hospital cover, including the range in-hospital costs you can claim back for as a private patient, as well as ambulance cover that isn't fully paid for by the public system in most states. By taking out a hospital policy before you turn 31, you can also get around a government-imposed levy that adds to the cost of your health insurance in the future.On the other hand, you'll need to account for the monthly costs of private health in your budget, which is often the most costly insurance you'll have. And there are still likely to be out-of-pockets costs for many services.
Ultimately, it's your call to make based on your health needs and circumstances.
Hospital cover and extras cover are both types of private health insurance. The key difference is that hospital insurance helps you pay for treatment as a private patient when you're admitted to hospital, while extras cover helps you meet the cost of services outside of hospital.
The MBS is a list of all the healthcare treatments and procedures subsidised by the government. These are called "items" and there are over 5,700 of them. There's a fee attached to every item on the MBS. Doctor's aren't obliged to charge the same fee for the whole cost of their service. Private health insurance can help you to meet any out-of-pocket costs.
If a policy is described as a "plus", then it will cover the minimum number of treatments for its tier, along with at least 1 treatment from the next tier up.
Tim Bennett is a Finder insurance expert. For over 10 years he's reported on news, politics, finance and other topics as a journalist and radio presenter. Tim's roles have included radio news reader and breakfast at the ABC, news producer for SBS and producer for Fairfax Media. Tim regularly appears as a health insurance expert on programs like Sunrise and SBS news, as well as in the Australian, The Daily Telegraph, The Courier Mail and more.
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