1. What category is my hospital policy in?
From 1 April 2019, private health insurers will classify their policies as either; Gold, Silver, Bronze or Basic, depending on the clinical categories the policy covers. Gold is the highest tier and covers all of the 38 new clinical categories. Conversely, Basic policies only need to cover three categories (rehabilitation, psychiatric services and palliative care). Further information about the clinical categories can be found at health.gov.au
These categories aim to improve transparency by standardising terminology and make comparisons between policies easier.
Also look out for “Plus” policies, which signify that the policy offers higher cover than the minimum required in its tier.
2. What excesses do you offer?
Health insurers can now offer a higher excess of $750 per year on their hospital policies (limited to $1,500 for couples and family policies).
Ask the fund whether they have a cap on their excess payment in their couples and family policies. Some funds (including Doctors’ Health Fund) will cap the excess payment to $750 for every person on the policy, meaning the same person will not pay more than one excess per year.
Higher excesses will reduce your hospital policy premiums, although you should consider the savings in the context of the higher excess that may be payable.
3. Am I likely to pay an out-of-pocket cost?
Even on a Gold cover, you may incur out-of-pocket medical costs. This can arise where the treating doctor charges in excess of the fund’s medical schedule. You should make enquiries about the proportion of services that the fund pays with no out-of-pocket costs. This is an indication of the quality of the fund’s medical schedule.
Also, ask whether your fund operates a ‘known-gap’ schedule as well as ‘no-gap’ schedule. Known-gap allows the treating doctor some flexibility to charge a predetermined gap above the schedule fee, while the medical fees still qualify for benefit payment by the fund.
Finally, ask if your fund has any restrictions on paying medical fees in uncontracted hospitals, including public hospitals.
4. Do you have a preferred provider network?
Some funds operate preferred provider networks for their Extras policies. This means some of their policy benefits may only be available at providers either owned or contracted by the fund. Always ask whether the benefits offered will be the same at your chosen allied health provider as they are at the fund’s preferred network.
5. Do you offer discounts for 18 to 29-year-olds?
From 1 April 2019, insurers can offer discounts to members aged between 18 and 29 on their private health insurance hospital policy. This new initiative is designed to make private health insurance more affordable for young people.
The discount is voluntary and health funds can choose to implement it. If you are under 30 years old, make sure you ask whether this discount is available.
These reforms are a step in the right direction. Time will tell whether they achieve their objectives of simplifying private health insurance while improving the affordability and sustainability of the system.