For Australians deciding whether to stay with Medicare or purchase private insurance doesn’t have to be a pain. Many people can receive great care without private insurance, but for those whose medical needs require something a little extra, private insurance may be the right way to go.
There are many reliable and affordable private providers in Australia (for an example click here) that can cover your medical needs, but there are certain key differences between Medicare and private coverage that you should be aware of. They are:
Private Health Insurance
• Covers Orthodontia: Private insurance covers around $3,000 for the cost of braces, but a waiting period of 12 months applies before benefits can be received.
• Ambulance Coverage: A ride in an ambulance can cost as much as $12,000 out of pocket without private insurance (except in Tasmania and Queensland, where ambulance costs are covered by the state).
• Choice of Hospital and Doctor: Without private coverage, the choice of hospitals can be limited. Patients can only be seen at public hospitals and are subject to significant waiting periods. Private hospitals often times have faster service and are generally less crowded.
• Out of Hospital Care: Private insurance covers at home care, including rehabilitation due to a cardiac illness, childbirth, limb injury, etc.
Save on Taxes: Households earning more than $168,000 annually will be subject to an additional 1% to 1.5% tax on net income, known as the Medicare Surcharge Levy. This extra tax could exceed the cost for private health insurance anyway.
• Affordability: For individuals earning under $84,000 annually or families with a combined income of less than $168,000 the benefits received from Medicare are potentially greater than private insurance.
• Public Doctors and Hospitals: Medicare does provide free access to public facilities, but doctors are assigned to you. Also, Medicare allows free access to “bulk billing” doctors outside of hospitals.
• Dental Care: The majority of dental procedures are not covered by Medicare.
• Prescription Glasses and Contact Lenses: These items are not covered under Medicare.
• Prescription Medicines: Medicare covers some prescriptions, but only medicines under the Pharmaceutical Benefits Scheme (for more information visit the PBS website).
• Childbirth: Health care costs related to pregnancy and childbirth are covered by Medicare, but only in relation to hospital care.
There are quite a few things to consider before deciding whether or not to stick with Medicare. For some it makes sense while for others it doesn’t. There is no “one size fits all” solution to this debate as everyone’s needs are different. Education is the best tool when it comes to choosing which route is the best to take.