Phoodilicious

I have been on various government and other websites trying to work out what is actually involved with having to pay the Medicare surcharge or get a private health insurance policy. I have found a calculator that assumes you are already in Australia and can fill in all the financial details and then it works out whether you have to pay or not. However I am not yet in Australia and am just researching so what I want to know (within the understanding that this is just a guesstimate at this stage) is:

As a married person but likely the only/sole income do I use the single income threshold of >$84k or the family threshold of >$168k as the base line of whether I might incur the levy? I note that the higher the income the higher the % surcharge but that $84k/$168k are the baseline.

My understanding (such as it is as I am rather confused currently!) is that if you are a high-income earner who purchases a hospital insurance product with a front-end deductible or excess no greater than $500 for singles or $1,000 for families/couples then you are exempt for the MLS. The "excess" figure - what is meant by that? Is it that in the event of a hospital admission I would pay up to the first $500 and then the insurance kicks in? If the cover is for both myself and my husband, hoping that we wouldn't both be in hospital at the same time (!) would the excess be in fact $1,000 before the insurance kicked in or is the excess of $500 per person?

Any help in understanding this would be welcome please!

goldchoccycoin

Hi - you would use the family threshold for your earnings (168K) as you are in a 'family' for tax purposes.

The excess figure is what you would pay per hospital admission as determined by the health insurance provider and can range from $0 to a lot! The exact applications of the excess are also policy specific. I imagine that for a family policy you would pay the excess per hospital admission (but I could be wrong).

Some policies have very low (or $0) excess and some policies you can reduce your premium by paying a higher excess if you do need to go to hospital.

In summary, if I were you I would estimate your likely family income and determine if you will be hit with the MLS. If not, consider the private health policies that offer you the best value (some have good rebates for extras such as dental and physio) and will also provide peace of mind if you need hospital treatment - although the public system is very good in general, you can be left in a queue for non-emergency treatment.

I consider it a good value insurance (it works well for me) but others feel it is a big expense for little benefit.

www.privatehealth.gov.au is the official resource

Phoodilicious

Thanks, so it would seem that I would have to look for a private policy that has a policy excess or deductible of less than $1,000 for a family policy to be exempt from paying the surcharge. Seems odd that they want you to limit the excess, you'd think the Medicare system would be happy for you to use private cover and pay whatever you needed to out of your own pocket?!

If you have private cover as well as entitled to Medicare (under reciprocal agreement) what determines whether you use the Medicare system or the private system for any medical condition? For example if I just want to see the Dr for standard check up and asthma medication I would use Medicare but if involved in an accident or wanted to be seen quicker for a non urgent condition then I can choose to go private?

Swerv-o

You can't use PHI for Doctors visits - If the Doctor is not bulk billing (charges the Medicare rate), then you will have to wear the additional costs yourself, and Medicare will pay back a proportion. This is also true for specialists and consultants visits in their rooms - which can be very expensive.

It is entirely up to you if you use your PHI or not. Very often, using PHI will mean gap payments that you will also have to cover yourself. These can amount to many thousands of dollars - Wol tells of interesting stories where his out of pocket expenses were crippling. You will need to make a decision as to whether the treatment required is urgent and if it's worth the extra expense. If it isn't, then I probably wouldn't bother using the PHI. I have been in and out of hospital since I arrived, and have never used it - always had excellent service on the public system.

If you have something that is life threatening and/or particularly painful, then there is certainly an argument for using the PHI and getting the best care that you possibly can, as by that point, cost will rarely be a consideration.


S

DadAgain

this I agree with - I have PHI but feel like if I were to go to hospital I'd be terrified of using it 'cos its always a HUGE expense. My limited exposure to needing medical treatment has always been successful publicly and enormously expensive privately (despite high level cover PHI). I like that my PHI means I and my family never pay anything at the dentist and the wife gets contact lenses sorted - but for that benefit alone its certainly not worth the ~$300 a month we pay!

That being said - I've heard too many tales recently of people struggling with public health: A colleague of mine broke her ankle recently and was sent home from public hospital with a minor patch up and a box of inadequate pain killers to wait for surgery.... After a few days her PHI (she's an international visitor) details got sorted out and the private hospital got her in within an hour and made a HUGE difference. Another colleague recently had Gallstones and was told of a 6 week wait for surgery, during which time he had to chose between eating and suffering crippling abdominal pain or not eating and starving, Private cover would've had him in surgery immediately...

I guess each medical case has to be taken on its own merits - try public first and if they tell you you have to wait be prepared to whip out the PHI card AND let your credit card take a bashing!

goldchoccycoin

It entirely depends on whether you have a big excess and are required to pay Gap fees. My policy (with a not for profit) has no excess and no gap - and they regularly publish examples of clients who have had major surgery and their out of pocket expenses. Recently they showed that for open heart surgery the total costs were in excess of $300K, of which medicare covered about 60% and the PHI covered all but $400 of the rest.

You need to do your homework and find an appropriate policy for your needs.

Best of luck.

Swerv-o

Whether you pay gap fees depends entirely on the surgeon that you 'choose' Many surgeons have a 'gap free' agreement with different PHI providers, but many also don't. If you find one that won't see you Gap Free, then your out of pocket expenses will increase by an awful lot, and PHI will not be interested.

This is why you are meant to 'shop around' surgeons and aneasthetists - but really how much shopping can you actually do? It's not like buying a new car.


S

Phoodilicious

Thank you everyone, the fog surrounding this whole healthcare issue is starting to clear for me a little, it's now just more of a thick mist!

So with the IMAN cover which is designed specifically for 457 visa holders, even the basic plan says no excess $0 and that 100% of the cost for cover in public or private hospital is covered and the cover includes Out-patient services which includes doctors, specialists and pathology etc. It says it covers 100%:
Hospital accommodation for overnight and same day stays
Operating theatre, intensive care, ward fees
Medical gap scheme (nib Medigap) available

So if it covers 100% why does it mention that a medical gap scheme is available (so assume it is not included)?

StSabre

But with a high excess you will use the public system for all but the most expensive (and unlikely) items, not saving Medicare much.

Wol

As it happens, I had retinal surgery last week: my private insurance paid the hospital bill for overnight, but my other expenses were:

2 consultations: $390 with a medicare refund of $109.30. Surgeon $3500 with M/C refund $1229.40, insurance refund $409.80. Insurance excess $450 direct to hospital. $69.50 post-op drugs, no refund. I have yet to get the anaesthetist's and assistant doc's bills but they are estimated at around $600 each.

There were also several other costs: other eye drops, pads etc.

I have to say that the op, at MacQuarie Uni hospital in Sydney, was fantastic.

spouse of scouse

Private health insurance in Oz is a minefield, and the suggestion to shop around can't be stressed enough. A very different experience to Wol's - I had a spinal fusion in a private hospital. I was in for 3 days and my expenses were $250, which is my nominated yearly excess for hospital admission, and $180 for a physio to come to see me. My own consultant's fees were fully covered, as were theatre fees, anaesthetist, drugs in hospital and on discharge, everything else bar the two items mentioned. It probably makes a difference that I'm with a large PHI who has 'preferred' private hospitals, dentists, optomitrists etc - and in Perth they're just about all on the list

Phoodilicious

I don't understand why Medicare doesn't pay for everything if the operation was deemed medically necessary? Why do they only give you a partial refund? Who decides which part of any treatment/operation is going to be paid for by your private health insurance and which parts will be covered by Medicare (either in full or in part, which like I said I don't understand why not in full?).

So basically Medicare is not like the UK NHS system in that it covers everything (except for elective procedures, so long as you are prepared to wait)?

Sorry for being so dense, I normally pick things like this up reasonably easily but the more I learn I seem to answer some questions but open up others!

Pollyana

Same reason that if you visit the doctor Medicare only pays for part of it, thats the way it works. My last visit cost $70, I got $36 back. No bulk-billing doctors round here so it costs every time I go.

renth

Medicare is very similar to NHS if you have to go to hospital for an operation, you don't generally have to pay anything. You do need to pay for most GP visits but get most back.

Private Hospital insurance is very different from UK private, it simply gets you further to the front of the queue and lets you choose your Surgeon and covers a portion of your costs. Not worth it in my opinion but I have it because The hospital portion of "Private Medical Insurance" premiums isn't that high and I know that if I cancel it, I'll need it straight away, sod's law.

You do have to shop around though, I need a gastroscopy and the waiting list is over a year on the public system. If I go private it will cost at least $500 (my excess) however I think I might just be able to pay without using my insurance and it will be less than $500, it's $300 over east but bound to be more in super expensive Perth. I'm getting some quotes.

Phoodilicious

Ok thank you. I believe I will need to have private health insurance anyway to arrive in Australia under a 457 visa and can apply for Medicare and also to avoid the medicare levy surcharge thing. I guess I can probably just get a fairly basic cover so long as it meets the criteria needed for both the initial 457 visa coverage and then meets the required excess less than $1000 thing and whatever else I need to make me exempt for the surcharge. It's all highly confusing!