What is private health insurance?
In Australia, private health insurance allows you to be treated in hospital as a private patient. It can also help pay for health care costs that Medicare doesn’t cover, such as physiotherapy. How much and what it covers depends on your policy.
To get private health insurance you must:
- buy a policy from a registered health insurer
- pay regular premiums to stay covered.
Benefits of private health insurance
More health cover and choice
Depending on your policy, private health insurance pays some or all of the costs of:
- treatment in public or private hospitals as a private patient with the doctor of your choice
- health services that are not covered under Medicare such as physiotherapy, dental and optical.
Private health insurance might also help you access some hospital services more quickly.
Find out more about what private health insurance covers.
You can still choose to be a public patient in a hospital if you have private health insurance.
Pay less tax
Buying private hospital cover might mean you don’t have to pay the Medicare levy surcharge.
The Medicare levy surcharge is a levy of up to 1.5% of taxable income on people who:
- don’t have private hospital cover
- earn income over a certain level.
Find out more about the Medicare levy surcharge and whether it applies to you.
Get a private health insurance rebate
You’re entitled to a private health insurance rebate from the Australian Government if:
- you have private health insurance that provides hospital cover, general treatment (‘extras’) cover, or both
- your income is below a certain limit.
You get the rebate as:
- lower insurance premiums through your health insurer, or
- an offset in your annual tax return – this reduces the tax you have to pay.
Read about the Private Health Insurance Rebate or use the private health insurance rebate calculator.
Avoid paying more for cover when you’re older
Lifetime Health Cover is an Australian Government initiative that lets you avoid paying higher premiums for private hospital cover. To be eligible for this you need to take out hospital cover before you turn 31 years old.
If you’re over 31 and take out hospital cover for the first time, you may pay higher premiums for the next 10 years. You won’t pay more for extras cover.
Work out what you might have to pay with our Lifetime Health Cover calculators or read more about Lifetime Health Cover.
Who can get private health insurance
You don’t have to take out private health insurance, but you can choose to if you want cover for more health services and choice.
Most insurance is risk rated – for example, car or house insurance. Private health insurance is community rated. This means:
- everyone pays the same price for a particular policy
- a health insurer can’t refuse to insure you or sell you the policy you want to buy
- you are guaranteed the right to renew your policy.
Overseas student health cover
If you’re in Australia on a temporary visa, you should consider buying insurance to cover the costs of medical treatment. Find out more about health cover for overseas visitors and overseas students.
International students who haven’t been able to return to Australia due to COVID-19 should contact their private health insurer to find out about options for extending, or suspending, their cover. Some may offer a period of suspension, but they are not required to do so.
Read our collection of resources for international students.
Overseas Student Health Cover (OSHC) resources
Who provides private health insurance
By law, only registered health insurers can provide private health insurance.
Some health insurers can only offer policies to people in certain industries, companies or groups. These are called restricted insurers.
Learn more about private health insurance laws.
How private health insurance works with public health care
Private health insurance works with our public health care system to offer you more choice and quicker access to some health services.
This table compares public and private health care services.
|
Health service |
Public health care |
Private health insurance |
|
In-hospital services |
You may be treated as a public patient in a public or private hospital. The public health care system will cover the cost of your treatment. As a public patient, you cannot choose your hospital, doctor or specialist. |
When you choose to be treated as a private patient in hospital:
As a private patient, you can choose your hospital, doctor and specialist. |
|
Doctor and specialist services outside of hospital |
Medicare covers some or all of the costs of services such as:
|
Not covered. By law, health insurers can’t offer cover for most of these services. |
|
Other services outside of hospital |
Medicare covers some or all of the costs for other services outside of hospital including:
|
You can choose policies that cover some or all of the costs for many services outside of hospital. |
|
Prescription medicines |
Prescription medicines are covered by the Pharmaceutical Benefits Scheme (PBS). |
You can choose policies that cover some prescription medicines not covered by the PBS. |
|
Prostheses |
The costs of implanted prostheses are covered if you’re a public patient. |
If your policy covers the procedure to implant a prosthesis, it will also cover some or all of the cost for the prosthesis itself. Find out more about private health insurance cover for prostheses. |
|
Ambulance |
Some state and territory governments provide ambulance cover. |
You can choose policies that cover ambulance costs when they are not covered by your state or territory government. |
Public hospital outpatient clinics
If you are treated in a hospital outpatient clinic, this does not mean you have been admitted to hospital.
If you are treated as a public patient in a public hospital outpatient clinic you won’t pay anything.
If you have a private referral to see a doctor in a public hospital outpatient clinic and the treatment is on the MBS, you can claim a Medicare benefit.
Medicare pays 75% of the MBS fee for services on the MBS that you receive as a private patient in a public or private hospital.
Learn more about what private health insurance covers.