Top private health insurance companies Australia

Health Insurance FAQs

Private health insurance is an optional type of insurance which allows the policyholder to be treated in the private hospital system and covers a variety of healthcare options and medical expenses, depending on the specific policy. Australians can choose between hospital and/or extras cover. Hospital policies generally include some financial cover for hospital expenses such as medical treatments, hospital accommodation bills and ambulance costs (depending on the state). Extras can include a benefit for services such as dental, optical, physiotherapy, chiropractic and a range of wider general treatments performed outside a hospital, such as pharmaceutical and psychology.

2. What does private health insurance cover that Medicare doesn’t?

In Australia, the taxpayer-funded Medicare system covers most residents for health care and is paid for largely by the Medicare levy, which most Australians pay on their annual tax returns. However, Medicare does not cover everything. You may wish to consider a private health insurance policy to give yourself a wider range of health care options and more comprehensive cover.

Private health insurance lets you receive treatment as a private patient in a hospital and generally allows you to choose your hospital, doctor and specialist. You can also take out a health insurance policy that covers out-of-hospital services (extras) not covered by Medicare, such as general dental, physiotherapy and chiropractic, and some prescription medicines not covered by the Pharmaceutical Benefits Scheme (PBS).

3. Is private health insurance worth it?

There are a number of potential benefits of having private health insurance. For example, you can get a wider range of cover, choose your own doctor and avoid paying the Medicare Levy Surcharge and Lifetime Health Cover loading, if applicable.

That being said, there are also some potential drawbacks to be aware of. For example, private health insurance can be expensive and it can also come with various limits and exclusions. Read more about private health insurance and whether it is right for you and whether to seek treatment through the public or private healthcare systems.

4. How can I save money on my health insurance?

You can compare health insurance providers with Canstar to see if you can get yourself a better deal for your specific needs and requirements. General tips to potentially save money on your health insurance premiums include mixing and matching your hospital and extras policies, ‘consciously uncoupling’ a couples policy if it leads to better value, ‘turning off’ certain items in your policy if you think you won’t need them in the immediate future, paying upfront before 1 April to ‘lock in’ a lower premium, evaluating the merits of choosing a higher excess, and taking out insurance by 1 July following your 31st birthday at the latest, to avoid Lifetime Health Cover loading. You might even try negotiating a better deal with your provider directly. Find out about some of the latest deals and offers available for health insurance.

5. How can I choose health insurance?

After deciding whether to go public or private, you can identify policies that may suit you personally by comparing private health insurance. When choosing, some questions to ask yourself could include:

6. Does Medicare cover ambulances?

Medicare does not cover the cost of ambulances or other emergency transport. Ambulance costs are different depending on your state or territory. For example, in Queensland and Tasmania, ambulance fees are covered by the state government. In other states and territories, you can organise ambulance cover through a private health insurer or, in some places, the state ambulance authority.

7. What is an ‘excess’ in health insurance?

An excess is the amount of money you have to pay if you make a claim on your hospital policy. You can apply an excess to your health insurance policy to make your premiums cheaper. Typically, the higher your excess is, the lower your premiums and vice versa.

You have to pay the excess to the hospital when you are admitted for treatment as a private patient. The remaining costs will be paid by Medicare and your health insurer (depending on your cover). You may need to pay out-of-pocket costs in some circumstances.

No excess applies to extras cover, but annual and sub-limits usually apply.

8. What does ‘no gap’ mean in health insurance?

‘No gap’ means you don’t need to pay any out-of-pocket costs. A gap refers to the difference between your doctor or hospital fees and the amount that Medicare and/or your health insurance provider will pay.

If you are admitted to hospital as a private patient, Medicare typically pays 75% of the Medicare Benefits Schedule (MBS) fee and your health fund will pay the remaining 25%. However, a doctor or specialist may charge more than the MBS fee, and in this case you would have to pay an out-of-pocket fee.

Some health insurance providers have gap cover agreements with health care services, meaning all or some of the gap will be covered by the insurance provider.

9. Should I buy private health insurance for pregnancy?

If you are considering private health insurance for pregnancy, and looking to have your baby in a private hospital or as a private patient in a public hospital, it is a good idea to plan ahead and be aware of waiting periods. All health funds have a 12-month waiting period for pregnancy-related expenses, according to the Private Health Insurance Ombudsman, so you’ll need to have the policy for a year before you can make a pregnancy-related claim. 

It’s also important to ensure the health cover you choose suits your needs and your budget during pregnancy, as well as the delivery and post-delivery stages. You can compare family or single health insurance policies that include pregnancy services and look for a policy that best suits your needs. You may consider keeping your partner’s insurance separate until after the delivery if you want to avoid an unnecessary higher level of obstetrics cover for them, as well as for you.

10. How can I avoid health insurance waiting periods?

You may not need to re-serve waiting periods if you switch from one health insurance provider to another, unless you add or upgrade your hospital cover, according to the Ombudsman. While providers sometimes waive two- to six-month periods on extras, it’s generally less common for longer waiting periods to be waived on pre-existing conditions, obstetrics or major dental. Insurance providers often advertise special offers for waived waiting periods in March and April, as premiums typically increase on 1 April and customers are seen as more likely to be shopping around for better value around that time.

11. What is the private health insurance rebate?

The private health insurance rebate is money the government may contribute towards the cost of your private health insurance premiums if you earn below a maximum threshold each year. As the rebate is income-tested, your entitlement will reduce as your income increases. According to the Australian Taxation Office (ATO), you will be eligible for a rebate if you (1) hold a Medicare card; (2) have a complying private health insurance policy; and (3) have an annual income that’s $140,000 or less as a single, or $280,000 or less as a family, and meet related specific requirements.

12. Who is eligible for the private health insurance rebate?

Many Australians are eligible for the private health insurance rebate, but just how much you’ll get back depends on factors such as your income, age, and whether you are single or have a family, according to the ATO. 

Your family size can make a difference too – the family income threshold increases by $1,500 for each Medicare levy surcharge-dependent child after the first child. The private health insurance rebate tiers are grouped by ages, as under 65s, 65 to 69-year olds and 70-year-olds and above. Generally, the older you are and the less you earn, the higher your rebate will be.

13. How much is the private health insurance rebate?

At the time of writing, according to the Australian Government:

• Single Australians earning up to $90,000 or families earning up to $180,000 may be eligible for a Base Tier rebate that varies from 24.608% to 32.812%.
• Single Australians earning $90,001 to $105,000 or families earning $180,001 to $210,000 may be eligible for a Tier 1 rebate from 16.405% to 24.608%.
• Single Australians earning $105,001 to $140,000, or families earning $210,001 to $280,000 for the tax year could get a rebate of 8.202% to 16.405%
• If you earn upwards of these amounts, you are grouped in Tier 3, which doesn’t offer a rebate.

These income thresholds are indexed and will remain the same until 30 June, 2023. 

Below is a list of the winning health insurance providers from Canstar’s 2021 Health Insurance Awards (national and state winners):

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You can compare health insurance providers using the comparison selector tool at the top of this page.

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