Public or private? The question of whether to take out a health insurance policy or rely on the public system is not always an easy one to answer.
Private vs public health insurance
Private health benefits cover policyholders for certain hospital costs and for any medical expenses that are not covered by Medicare, even when the patient is treated personally.
Depending on the situation, there are some medical expenses – including a visit to the GP or an X-ray to treat a condition in a hospital – that could be covered by Medicare via the public health system. However, some treatment expenses are still not covered at all by Medicare. This ensures that if you don’t have private health insurance certain services may be left with a big bill.
In general, private health insurance is split into two primary areas: medical cover and general care coverage (extras). Ambulance protection may also be available as a third form of private health insurance depending on what state or jurisdiction you live in.
If you’re comparing health insurance policies, the table below displays a snapshot of a hospital and extras policies currently available on Canstar’s database for a single female.
|Company||Star Rating||Excess per admission||Hospital Cover Tier||Hospital Cover Tier|
|classic silver plus & black 50 saver||$750||SILVER|| 1300861418|
on ahm Health Insurance’s website
|Standard Hospital (Bronze Plus) & Basic Extras (BSE)||$750||BRONZE||More details|
|Lite Hospital $750 Excess – Bronze Plus & Budget Extras 60||$750||BRONZE||More details|
|Lite Hospital $750 Excess – Bronze Plus & Top Extras 60||$750||BRONZE||More details|
|Mid Hospital $750 Excess – Silver Plus & Top Extras 60||$750||SILVER||More details|
View all Canstar rated Health Insurance products
Potential advantages of private health insurance
- Shorter Time to wait
Private Health Insurance will benefit from a shorter time of waiting to obtain care. This is especially helpful for optional surgery, often requiring lengthy waiting periods.
2. Private hospital rooms
Another potential benefit of private health insurance is the option of being treated in a private room. In a public hospital, you are often placed in a room with four to six other people with various conditions. Private health members are typically able to request a private room
3. Claim money back on non-Medicare health services
Many people sign up for private health insurance to receive a rebate on health services that are not covered by Medicare. For example, extras cover often covers you for services such as dental, optical, chiropractic and physiotherapy. Without private health insurance, getting a filling or buying new glasses may be quite expensive.
4. Dental covered by private health insurance
As mentioned above, it is usually not Medicare that goes to the dentist. Even the most common procedures are usually not provided such as tooth checks or clean and measure.
5. Select your doctor or surgeon
Many private health insurance plans allow members to choose their favourite doctor or surgeon. Your doctor will be at the facility during your treatment in a public hospital.
Potential drawbacks of private health insurance
About half of Australians are covered by private health insurance. In May of 2020, 43.8% of the public have coverage in hospitals and 53.2,% of the population have extra cover. According to the private health insurance figures of APRA for May 2020. This means that many individuals conclude that their benefits actually do not outweigh the drawbacks of private health insurance. Indeed, APRA cautioned that only a few insurers will stand before 2022.
Here are some of the reasons why people might decide not to take out private health insurance.
1. The cost
Private health insurance can be expensive – depending on their policy, an individual, couple or family could pay thousands of dollars in premiums each year, with costs typically increasing annually.
2. Complex products
For some, the huge variety of products on offer and the range of policy inclusions and exclusions can be overwhelming and challenging to understand. Health insurance reforms introduced in 2019 are aiming to simplify the products on offer.
3. Excluded treatments
Depending on the procedure, you will also not be protected if you actually seek care in the hospital. Not every treatment or procedure can be protected by such a robust policy.
4. Out of pocket costs
Only part of the costs of care or operation shall be included under a private insurance policy. You could end up paying a considerable amount, for example as excess, but less than you could pay if you were not insured.