How does Private Health Insurance work?

This can be confusing especially if you are accessing private health care for the first time and it is even confusing for people that work in healthcare. This is because of the “marbling” of different Commonwealth, State and Private Healthcare funds involved in health.

When you have an outpatient appointment with Dr Foo

When we see you in the rooms, then this attracts a Medicare rebate but no private health fund benefit. At the end of the consultation, there is a set fee and a Medicare rebate is reimbursed into your bank account.

When you have a hospital admission

These are fees for procedures which are [partially] covered by your private health fund. There may be an excess payable depending on your coverage, health fund and complexity of operation.

Rebates for surgical procedures are set by the Government and your health fund. These amounts were never intended to fully cover the cost of private surgical procedures. For the last 25 years, the Commonwealth Government has not adequately indexed the Medicare rebates. Both health insurance premiums and the cost of running a practice have increased with inflation, however payments from Medicare and private health funds have failed to keep up. This has resulted in the "Gap" between the rebates and the fees increasing over time. 

The AMA sets a schedule of fees for surgery. If a gap is charged then Dr Foo charges a discounted rate on the recommended AMA fee for most procedures.

What about inpatient investigations?

These are radiology and pathology investigations such as X-rays, scans, blood test and histology. These are generally covered by most health funds but your fund will be able to give you specific advice regarding this.

I would like to self fund my procedure

In some circumstances such as an unexpected finding, public waiting list times and the cost of living crisis means that you need to access healthcare without having appropriate health fund cover. Jonathan is happy to have a full and frank conversation about this and he urges you to obtain financial advice as well.