Last Updated on 25 November 2020

Do pensioners and senior Australians need health insurance?


Health insurance for older Australians is often a necessary expense. Sometimes it might even be the only practical option for people aged 65 and above. But the right policy should still be cost-effective and provide the right level of cover for your circumstances.

It’s why we’ve created a comprehensive guide to health insurance for older Australians, to help you cut through the jargon and know how to find affordable health cover.

Key Points
  • Many health funds have policies designed specifically to meet the needs of Australian seniors.
  • Taking out private health insurance means you won’t have to endure long waiting lists for procedures like joint replacements or cataract surgery.
  • The government’s private health insurance rebate can reduce your costs, depending on your age and income.

What is seniors health insurance?

Health insurance isn’t a one-size-fits-all approach, which is why insurers often create specific policies for older Australians, built around different lifestyles, ages, health needs and more.

Seniors health cover are policies that have been designed to cater to singles and couples of a particular age. Some providers offer specific policies and packages for those aged 50 and above, while others have policies more suited to retirees and pensioners aged 65 and older.

The right seniors health insurance policy can help pay for your healthcare expenses as you age. Each policy will cater for differing needs depending on your current circumstances and your anticipated future needs.

What does health insurance for seniors cover?

Health insurance for older Australians can be broken into hospital cover and extras cover (out-of-hospital services like dentists, and glasses and corrective lenses). You can buy hospital and extras separately or combine the two. Combined policies often offer better value.

As us older Australians tend to have different health needs than people twenty years younger, you may want to look out for policies that include items like joint replacements and cataract surgery.

Hospital cover is now broken into four categories: Gold, Silver, Bronze and Basic. The top-tier policies (Gold and Silver) often include a range of items to suit seniors, such as:

  • Hearing-device implantation
  • Pain management with a device
  • Back, neck and spine
  • Heart and vascular system
  • Cataract surgery
  • Joint replacement

But remember that while Gold hospital cover is the most expensive option, that doesn’t necessarily mean it’s the best cover for you. It may contain items like pregnancy and obstetrics that seniors won’t need.

Many insurers offer “Silver Plus” policies that have been created with older Australians in mind. These often contain a lot of the items that come in a Gold policy, but strip away the unnecessary items that seniors will never use.

Each insurer will also offer a range of extras packages. Some of them will be more appropriate for older Australians and include items like podiatry, chiro, occupational therapy, and remedial massage, as well as standard extras such as optical and dental.

Keep an eye out for extras rebates and limits. Some extras policies may look affordable but have miserly limits on what you can claim, which you’ll quickly use up, or may only give back a small percentage when you come to claim.

Every older Australian is different and your health insurance needs will be different too. Because your life is constantly changing, your health needs will change as well – so it’s a good idea to review and compare your health cover every few years to see if there’s a better policy for you.

What does health insurance offer that Medicare doesn’t?

There are a number of items and procedures for seniors that Medicare doesn’t cover but are included in private health insurance.

Private health insurance can also cut your waiting times for elective surgery, which is especially useful if you have a long-standing problem that’s affecting your quality of life. You can also choose your own doctor.

Using extras smartly – such as getting a good deal back on glasses – is a way to get better value from your health fund. It means you don’t have to rely solely on Medicare, and you can get peace of mind that you’ll be adequately covered as you age.

What doesn’t seniors health insurance cover?

No matter what seniors health insurance you take out, you won’t be covered for aged-care services. Beyond that, any further exclusions will depend on your health insurance provider and the policy you choose.

Medicare subsidises eye tests, GP visits and consultations with a hearing specialist.

Eye tests are covered by Medicare, while general GP visits are often partially covered – although a Commonwealth Seniors Health Card can cover your doctor visits under bulk billing (this is at the discretion of the doctor).

How does seniors health insurance work with elective surgery?

Appropriate private health insurance can speed up waiting times for older Australians who require elective (non-emergency) surgery, such as hip replacements or cataract surgery. Without private health insurance you may have to endure a long wait to be treated publicly.

Do seniors still need health insurance in aged care?

Private health insurance for seniors doesn’t cover the costs of aged care, but most aged-care services are partially subsidised by the government for eligible Australians.

Some of your health needs will be tended to by your aged-care provider, but it’s still worth keeping private health insurance. You may need it for elective surgeries and to give you greater choices in your health care.

Because moving into aged care is such a big lifestyle change, it’s important to review your seniors health insurance and see whether you need to adjust your level of cover. This may help you save money while still getting the healthcare you need.

How much does health insurance for senior Australians cost?

Before getting into specifics, it’s important to remember that many Australians are paying more than they need to for their health insurance because they haven’t reviewed their policy recently. Older Australians who’ve been loyal to their health fund for many years can often be on an unnecessarily expensive policy.

If you’ve not compared or switched your health insurance in over three years, you could be overpaying due to yearly rate rises. Similarly, if you haven’t switched and your life circumstances have changed, then you may have unnecessary items in your health cover, such as pregnancy and obstetrics.

So how much does health insurance cost for senior Australians? That will depend on the provider you choose and the level of cover you select. If you’re still healthy, then you may be able to take out a cheaper policy.

It can also be worth comparing policies to see if you and your partner will pay less with two singles policies or a couples policy.

The good news is that health insurance for seniors over 65 in Australia is made easier thanks to a government rebate to help cover the cost of premiums.

What rebates are available for seniors on their health insurance?

The Private Health Insurance Rebate you receive will depend on your income and your health insurance premiums. Use our calculator below to work out your rebate.

Depending on your age, family status, and income level, you may be entitled to a Government Rebate on your private health insurance policy. Use the sliders and dropdown menu below to calculate your rebate.






Your Rebate is 0
Singles < $90,000 $90,001 - 105,000 $105,001 - 140,000 > $140,001
Families < $180,000 $180,001 - 210,000 $210,001 - 280,000 > $280,001
Rebate
Base Tier Tier 1 Tier 2 Tier 3
Age < 65 25.059% 16.706% 8.352% 0%
Age 65-69 29.236% 20.883% 12.529% 0%
Age 70+ 33.413% 25.059% 16.706% 0%

Below are some general figures you can use to understand what you’ll receive.

Pre-existing conditions and seniors health insurance

A pre-existing condition simply means you have a particular illness, condition or ailment where there were symptoms present in the six months prior to you taking out seniors health insurance – or upgrading to a higher tier.

Pre-existing conditions won’t stop you from taking out hospital or extras cover, but it will usually mean you’ll have to serve a 12-month waiting period before your policy will cover you.

That said, there is only a two-month waiting period for rehabilitation, palliative care and psychiatric services.

When you switch to an equivalent cover with a new insurer, there are usually no new waiting periods.

How to find the best-value health insurance for seniors

It might seem easier just to stay with your current health fund but if you haven’t compared policies in a while, your life circumstances may have changed which could mean you aren’t covered for what you need – or you’re paying for items you no longer use.

Essentially, there’s a good chance you’re probably paying more than you need to. That can be a problem if you’re on an expensive top tier policy.

In 2019, we helped Australians save $380.79 on average when they compared and switched with Health Insurance Comparison. In addition, when you switch to a cheaper or equivalent level of cover, you usually won’t have to serve any new waiting periods.

 

To get the best seniors health insurance for your specific needs, you can compare today and switch to a better provider. At Health Insurance Comparison, we take care of all the heavy lifting for you.

Our team of seniors health insurance experts will scour our panel of trusted Australian health insurers to find the top policies for your lifestyle.

This guide is opinion only and should not be taken as medical or financial advice. Check with a financial professional before making any decisions.

ATO, Private Health Insurance Rebate, Nov 2020
Department of Health, Aged Care Subsidies and Supplements, Nov 2020


icon_message_double

Still have questions? Let's talk!

Confused? Not sure if this applies to your situation? Phone us on 1300 163 402 for some free, no obligation advice.

icon_message_double

Or want to compare policies now?