Private Health Insurance

One of the major expenses in Australia relates to private health cover with premiums for family policies (two adults and dependent(s)) with combined cover ranging from $139.60 per month (Bupa Australia) up to $1,344.45 (HBF Health) per month.  Add to this the complexities of cover, the range of add-ons and the differences from state to state and the proposition of getting a private health cover does get daunting indeed. Hence it is prudent to get some insight into this particular subject before moving to Australia There could be options like an interim cover for the period starting from landing in Australia to getting a private insurance in the new country.

Reciprocal Health Agreement

Immigrants from a number of countries can benefit immensely from an arrangement called Reciprocal Health Agreement with Australia that will allow them to get coverage under Medicare. The arrangement is available for immigrants coming from countries such as the UK, Sweden, Belgium, Norway, NewZealand, Finland, Italy and the Netherlands among others and also to the immigrants from certain other countries with a permanent resident visa. The Medicare enrollment process can be carried out by visiting the Department of Human Services web portal. Once the registration is successful, immigrants have issued a Medicare card that entitles them to get medical coverage under the Australian public health system. Reasons to take up private health insurance: Medicare provides limited treatment options and for non-emergency services including a dental cover, a good private health insurance is essential or else you face the proposition of long delays in treatment and the lack of options in terms of choosing the best treatment or facility of your own choice.

Life Time Health Cover Loading (LHC)

Another good reason to take up a good private health insurance in Australia is to avoid an additional income tax surcharge of 2% for individuals coming under the high-income slab. This penalty is termed as Lifetime Health Cover loading and the inherent logic behind this is to take some pressure away from the overburdened public healthcare system.

It is important to note here that for migrants who have just arrived in Australia you have until the later of 1 July following your 31st birthday or the first anniversary of your full Medicare registration to take out private hospital cover without incurring a Lifetime Health Cover loading. If the latter applies to you, your Lifetime Health Cover base day is the 12 month anniversary of your registration for full Medicare benefits (i.e. when you are eligible for a blue or green Medicare card). f you miss your Lifetime Health Cover base day or delay purchasing private hospital cover for more than 12 months after registering, you will have to pay 2% more in addition to your hospital cover premium for each year you are aged over 30 when you take out private health insurance. A wide range of private health insurance options are available in Australia specially customized for new immigrants.

Good starting points for the new Australian immigrants to look for the right private health insurance scheme are the iSelect web portal and Bupa. Both these sites offer highly intuitive interfaces and options to compare different private insurance products and customers are able to select schemes that best suits their budget and coverage requirements and expectations.

Another important web portal where new immigrants can learn about the different type of covers provided by private health insurance providers in Australia is: Privatehealth.gov.au .

Broadly speaking, most insurance plans in Australia come with a basic plan and customers can opt for add-ons such as hospital plans and extra. The cheapest option includes the basic plans and when the basic plans are bundled with the hospital and with the extra add-ons it gets more expensive. From a migrant’s perspective, although having a private cover does offer some piece of mind in case things do go wrong, the costs involved and the associated benefits are a big hurdle, especially considering that most migrants will be looking for jobs and having a whole range of expenses when making the move to OZ. As the immigrant settles down in Australia and the financial situation improves, there are possibilities to shed the add-ons and go for a cheaper coverage.

Australian Government Private Health Insurance Rebate

Most Australians with private health insurance currently receive a rebate from the Australian Government to help cover the cost of their premiums. The private health insurance rebate is income tested. The table below details the different rebate amounts and Medicare Levy Surcharge levels.

The rebate applies to hospital, general treatment and ambulance policies. It does not apply to overseas visitors cover. The rebate levels applicable from 1 April 2018 to 31 March 2019* are:

Single parents and couples (including de facto couples) are subject to family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first.

*The income thresholds are indexed and will remain the same to 30 June 2021.

Some good private health insurance options include:

AHM

MEDIBANK

BUPA

Australian Unity

HCF

NIB

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MIGRANT NINJA TIP – You should also take note of what is and isn’t covered by your policy – not all policies are comprehensive. Depending on your level of cover, you may not be fully covered against all costs associated with your treatment and have to pay some out-of-pocket expenses. You should review your cover from time to time to ensure it still meets your healthcare needs. If the premium has become a concern for you, there are a number of ways you may be able to manage your policy and lower costs. If you already have private health insurance, you can also consider moving to a different fund.