Private Health Insurance – Improvements to products

Under changes to private health insurance, benefits will now be paid for some services provided out of hospital and health fund premium loadings will be removed for 10 year long members from 2010.

Page last updated: 09 May 2006

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Why is this important?

  • Under current regulations, people with private hospital cover can only receive benefits for services available in the hospital. They cannot receive benefits for services outside it. They should be able to choose quality private health services that meet their health needs, including services provided outside hospital. They should not be restricted to in-hospital services just to use their private health insurance.
  • Currently, Lifetime Health Cover loadings once applied can not be removed. From July 2010, those who have a Lifetime Health Cover loading and who have held private health insurance with a loading for ten years continuously, will have their loading removed.

Who will benefit?

  • Currently, around 10 million Australians have private health insurance (hospital and / or ancillary cover) and will benefit from these changes.
  • Approximately 60,000 people who take out private health insurance each year are subject to a Lifetime Health Cover loading.

What funding is the Government committing to the initiative?

  • This initiative will cost the Government $4.6 million over four years.

What has been done in the past?

  • Private health insurance was developed at a time when most health care was performed in-hospital. Advances in health care mean that suitable health services can now safely be provided outside of hospital. This initiative will mean those with private health insurance will be able to buy cover for these services.

When will the initiative conclude?

  • While the initiatives are ongoing, funding to implement some initiatives will terminate in 2006-07 and 2009-10.

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