Permanent residency health insurance

So you've just got your permanent residency. Congratulations. Not only have you just got your future in Australia sorted, you're now able to get a regular health insurance policy.

This is good for a couple of reasons. You now have much more choice and health insurance tends to be a lot cheaper than overseas visitor health cover (OVHC).

Do permanent residents need private health insurance in Australia?

Private health insurance isn't mandatory for permanent residents. Australia has a public healthcare system called Medicare which gives you free access to medical services.

So why get private health insurance if you get healthcare for free? There's a few reasons:

• Avoiding paying the Medicare levy surcharge if you earn over $105,000 a year as a single
• Reduced waiting periods for specialist procedures and treatments compared to the public system
• You get to choose your own doctor and you can get your own private room

• What is private health insurance?

  Private health insurance is a system where you subscribe to a private company that provides you with rebates known as benefits for particular medical costs. In general, private health insurance exists in two forms: hospital insurance and extras insurance.

  Hospital insurance covers in-hospital treatment by a doctor in a private hospital. It can also help pay for associated costs like accommodation, ambulance transport and prostheses. Usually, private insurance will let you choose your doctor and give you a private room to stay in while receiving treatment.

  Extras insurance helps cover non-medical health services, including things like optical, physiotherapy and dental.

How does Medicare work?

Medicare is the name of Australia's national public healthcare system. Under Medicare, you have access to free treatment at public hospitals as well as reduced costs when using a wide range of non-critical health services, like visiting a GP or having a routine eye examination by an optometrist.

Medicare also exists in the form of the Pharmaceutical Benefits Scheme (PBS), which regulates the price of certain prescription medications that may otherwise be unaffordably expensive. In many cases, the PBS may reduce a drug that costs hundreds of dollars to $25, or $7.70 if you hold a concession card, for someone who has had it prescribed for them.

What health insurance do I need as a permanent resident?

As an overseas visitor up to this point, it's likely you'll have some form of Overseas Health Cover (OVHC) to save you from outrageous medical expenses while working in or visiting Australia. When you're a permanent resident, though, your healthcare benefits and entitlements change and it's likely that OVHC will either no longer apply or not be the best choice for you.

Once you have your residency, it's a great time to switch from overseas visitor cover to domestic health insurance. The good news is you'll also have a lot more choice.

As a permanent resident, you will automatically qualify for the public health system under Medicare. But, as mentioned above it might still be a smart idea to invest in private health insurance too.

Frequently asked questions

• What happens to my Overseas Visitor Health Cover OVHC when I get permanent residency?

  Once you become a permanent resident your eligibility for Medicare begins. This means your Overseas Visitor Health Cover OVHC is no longer the most appropriate or necessary form of health insurance for you. You should switch to a domestic private health insurance policy which generally offers broader benefits and is typically more cost effective. Contact your OVHC provider to cancel your existing policy and avoid paying for cover you no longer require.

• Do I need to serve new waiting periods when switching from Overseas Visitor Health Cover OVHC to a domestic private health insurance policy?

  Yes generally you will need to serve new waiting periods when you switch from OVHC to a domestic private health insurance policy. This is because OVHC is designed for temporary residents, while domestic policies cater to permanent residents and citizens. However some health funds may offer to recognise a portion of your previous waiting periods especially if you switch quickly after getting your permanent residency. It is always best to discuss this with your chosen health fund directly.

• Can I use Medicare immediately after getting permanent residency?

  Once your permanent residency visa is granted you become eligible for Medicare. However you will need to enrol with Services Australia to receive your Medicare card. While you wait for your card you can typically access Medicare benefits by showing your permanent residency grant letter and photo identification at a Medicare service centre or medical provider. It is always best to carry proof of your permanent residency until your physical Medicare card arrives.

• What if I have a pre-existing condition? Will it be covered by private health insurance as a permanent resident?

  For pre-existing conditions there is typically a 12-month waiting period before you can claim benefits from a private health insurance hospital policy. This waiting period applies to all new private health insurance members including permanent residents. Once this waiting period is served your pre-existing condition will be covered according to the terms of your policy. For extras cover the waiting periods for pre-existing conditions are usually shorter often two months.

• Can my family members on different visas be included in my private health insurance policy?

  If you have family members who are not yet permanent residents or citizens and are on different visa types, such as a temporary visa, they generally cannot be included on your domestic private health insurance policy. They will need their own appropriate Overseas Visitor Health Cover OVHC or Overseas Student Health Cover OSHC depending on their visa conditions. Once they also achieve permanent residency they can then join your domestic policy.

• What documents do I need to enrol in Medicare as a permanent resident?

  To enrol in Medicare as a permanent resident you will need to provide original documents proving your identity and permanent residency status. This typically includes your passport, your permanent residency visa grant letter or your visa label in your passport and a form of Australian photo identification if you have one. You will also need to complete a Medicare enrolment form. It is recommended to check the Services Australia website for the most up-to-date requirements.