Purchasing a private health insurance policy is not a decision that can be made lightly. A policy at odds with your needs may mean having to pay slightly more out of pocket for treatment at the very least. At worst, it may mean discovering that the policy whose premiums you’ve faithfully paid all these years actually doesn’t cover the procedure for which you’re being hospitalised.
Comparing policies from different private health funds isn’t as simple as determining whose premiums are lower, although that certainly helps. There are also other aspects a consumer should keep in mind when comparing policies, whether with an online tool or plain, old-fashioned enquiries to ensure apples aren’t being compared to oranges.
Pay For Only What You Need
Many consumers believe that they have no choice but to accept whatever policy a health fund offers, when the opposite is actually true. Tailor-making a policy is a surefire way of ensuring that a person in his or her twenties doesn’t have to pay for a knee replacement, whereas a senior citizen would certainly look at insurance for cardio-thoracic procedures instead of that for obstetrics.
Paying only for an essential coverage policy means that a person has to evaluate his or her policy from time to time. This should be done to ensure coverage of the needs most relevant to the person and their family at that particular time and reap the most benefits from premiums paid.
Types of Health Insurance to Consider
Comparing health insurance policies means knowing exactly what you get with the following covers:
Hospital – a person can claim reimbursement from a fund for the cost of accommodation, treatment and ambulance transport to a private hospital.
Extras – these include medical services not rendered in a hospital environment and which Medicare doesn’t cover, including optical, dental, chiropractic and physiotherapy and alternative treatment as well as ambulance transport.
Hospital-extras – this combines the best of hospital and extras cover for optimum general coverage, and are usually offered together with another policy.
See What Profile You Fit
Most consumers fall in to the following categories, from which a health policy that meets their needs most accurately can be rendered:
Young and single – young to middle-aged couples who already have children and have no plans to expand the family. Cover for people in this profile tends toward hospital cover for general procedures that include optical, dental, chiropractic and physiotherapy treatment.
Young couples/family with/without obstetrics – people fitting this profile are young to middle-aged couples planning to have children. The profile also includes couples who intend to add to their existing family. People like this are more interested in in vitro fertilisation (IVF)/obstetrics and hospital and extras cover than that for knee replacement or open heart surgery.
Young family, with obstetrics – includes young/middle-aged couples with young children don’t intend to extend the family. These growing families are more interested in a wide range of cover for hospital and extra fees to cater to post-natal care and young children.
Older families – encompasses established families that tend to comprise older couples and dependent offspring, i.e. those aged below 18. Families like these are less interested in obstetrics and IVF and are more concerned with braces for the children and cardio-thoracic cover for the parents. Cover for these families also tends to include that for optical, dental, chiropractic and physiotherapy treatment. Young to middle-aged single parents also tend to focus on policies that cover these concerns.
Mature singles/couples – individuals or couples who have never had, or no longer have dependent children worry more about their ability to meet the cost of knee/hip replacements or multi-focal lenses, as well as extras cover that encompasses optical, dental, chiropractic and physiotherapy treatment. There is little or no concern for obstetrics, IVF or post-natal cover in this profile.
Mind the Gap
A gap is the out of pocket expense a consumer must pay when the amount paid out by a private health fund is less than the cost of a specific medical procedure or service. The gap doesn’t exist for up to 80% of such services/procedures, but a consumer shouldn’t take it for granted when comparing health insurance policies from different funds.
Determining if a gap exists, as well as the difference, before purchasing a policy can do a lot to put a person’s mind at ease when he or she has to undergo hospitalisation or hospital treatment.
How Wide is Coverage?
Previously, private health funds covered the treatment costs only when a person was admitted to hospital, even though the same treatment could have been rendered in a non-hospital environment. Now though, there are funds whose hospital cover extends to medical treatment received at home, such as dialysis or diabetes management. This flexibility opens up a wider range of treatment options to a patient.
These are not the only aspects to consider when comparing policies from different funds. Other factors such as employment type (e.g. medical, education, rail and transport) may also make a person eligible for a more beneficial health insurance policy. Although there is no such thing as a universal health insurance policy, a person can obtain a more thorough comparison by providing relevant, comprehensive information.