Hospital Cover

Private Hospital cover is insurance that pays benefits towards approved treatments and services within public or agreement private hospital as a private patient. This includes, but not limited to:

  • Accommodation and bed fees,
  • Operating theatre fees,
  • Intensive care fees,
  • Labour ward fees,
  • Pharmaceuticals covered by the Pharmaceutical Benefit Scheme,
  • Ancillary health services such as in-hospital physiotherapy,
  • Consumables (e.g. dressings), and
  • Surgically implanted prostheses.
  • Primary surgeon’s / doctor’s service fees (e.g. Knee reconstruction),
  • Anaesthetist and support staff fees,
  • Check-ups and consultations (whilst still in hospital),
  • Pathology and radiology services,
  • Allied health care,
  • Rehabilitative specialist, and
  • Psychiatric staff.

The level of hospital cover you choose determines the types of procedures you're covered for (for example joint replacement, pregnancy or heart surgery). The higher the level of cover, the more procedures you will be covered for.

Hospital policies fall into four general categories; Public, Basic, Mid and Top. The classifications are based on the services that are shown as covered, excluded or restricted on standard information statements.






Waiting Period

Private Hospital 2 Months (unless pre-existing)
Public Hospital 2 Months (unless pre-existing)
Accident Cover 1 Day
Cardiac 2 Months (unless pre-existing)
Cancer Services 2 Months (unless pre-existing)
Bone Marrow and Organ Transplants 2 Months (unless pre-existing)
Pregnancy/Obstetrics 12 Months
Joint Replacement 2 Months (unless pre-existing)
Major Eye Surgeries 2 Months (unless pre-existing)
In Hospital Rehab 2 Months
In Hospital Psychiatric 2 Months
Surgical Weight Loss 2 Months (unless pre-existing)
Dialysis 2 Months (unless pre-existing)
Cosmetic Surgery
All 20,000 Other Medicare Procedures 2 Months (unless pre-existing)

Note: Individual policies may vary from this general guide.

Cover Type

Accommodation Type

Choice of Doctor

Choice of Hospital

No Cover Public patient, public hospital No No
Restricted Cover Private patient, public hospital Yes No
Full Cover Private patient, private hospital Yes Yes

What is an excess?

An excess is an amount that you agree to pay towards the cost of hospital treatment, in exchange for lower premiums. Much like your car insurance, you pay your excess upon being admitted to hospital, and all other eligible costs will be covered by the health fund. You may be required to pay an excess every time you go to hospital, or only the first time, depending on the private health insurance policy you take out.

Many funds offer policies with multiple excess options to choose from. The three general excess levels are:

  • $500,
  • $250, and
  • $0
Will I have to serve waiting periods?

You will have to serve a waiting period when you start a new private health insurance policy or increase your level of cover. A waiting period protects members of the fund by ensuring that individuals aren't able to make a large claim shortly after joining and then cancelling their membership. This would result in increased premiums for all members.

However, any waiting periods that have been previously served will be honoured by a new fund, so long as continuous cover is maintained.

Waiting periods that have been satisfied by an overseas visitor’s policy are not recognised by Australian health funds.

What is a Pre-Existing Condition?

A pre-existing condition is defined by the Private Health Insurance Act 2007 as any ailment, illness, or condition that you had signs or symptoms of during the six months before you purchased hospital cover or upgraded to a higher level. It is not necessary that you or your doctor knew what your condition was or that the condition had been diagnosed. A condition can still be classed as pre-existing even if you hadn’t seen your doctor about it before purchasing hospital cover or upgrading to a higher level.

In forming an opinion about whether or not an illness was pre-existing, the health insurer appointed medical practitioner who makes the decision, must take into account information provided by your own doctor. Your health fund will need time to advise you if your condition is pre-existing so be sure to check with your fund well before you go to hospital to make sure you are covered.

Even if you have a pre-existing condition, health funds must allow you to purchase any type of cover, at the same price as every other person. Once you have served the standard 12 month waiting period, you will be entitled to claim.

How do I claim after going to Hospital?

There are typically two types of accounts that need to be settled after being admitted into hospital;

  • The hospital fees - that pays the facility itself, and
  • The medical fees - that pays an individual specialist / doctor.

If the hospital has recognised you as being a Private Health Insurance holder, they will send the bill to your health fund directly for payment. If the hospital sends you an account, you should ask if they have also sent a copy to your health fund, as the invoice will contain technical notes that the hospital claims department can only get from the hospital.

Next will be the Medical fees from your specialist or surgeon. Either your doctor will give you the bill or send it straight to your health fund to pay. Once your fund receive it, if the account is already paid (by you), they’ll reimburse you. Otherwise, they’ll pay the doctor directly.

Will I have out-of-pocket fees?

Hospital fees

If you have agreed to an excess or co-payment on your policy, you will pay this amount upon being admitted to hospital (this is payable to the facility, not your health fund). So long as the service or treatment you are receiving in hospital is as an inpatient and isn’t excluded or within waiting periods, your health fund should be paying for 100% of these fees. If there were to be any additional expenses for yourself (such as meals or accommodation for boarders, daily newspapers, cable television etc), then these will be provided to you before to your admission.

Medical fees

Every possible medical treatment or surgery that’s subsidised by the Australian Government is indexed with a Medicare Benefit Schedule (MBS) item number. Medicare and the Department of Health maintain close to 20,000 of these listings, all with their own individual dollar amounts and they effectively act as a ‘recommended retail price’ for doctors to charge.

So long as you hold Medicare entitlements, 75% of the Medicare Benefit Schedule fee will be paid by Medicare and remaining 25% is paid by the health fund. However, should your doctor choose to charge above this amount, the difference between the MBS fee and what the doctor is charging will traditionally be your out-of-pocket.

Example: If your doctor charges $2,000 for a surgery that has been classed on the MBS listing as $1600, then Medicare will pay $1200 and your health fund will contribute the remaining $400. The left over $400 is your out-of-pocket cost.

out of pocket chart

Are there ways to avoid out-of-pocket medical fees?

Possibly. If your health fund has a Gap Cover agreement in place with your doctor, then either the whole or a very large amount of the out-of-pocket costs may just be passed back onto the fund.

Example: If your doctor charges $2,000 for a surgery that has been classed on the MBS listing as $1600, then Medicare will pay $1200 and your health fund can contribute the remaining $800. That leaves your with no out-of-pocket cost.

health cover chart

You should always check-in with your health fund prior to any hospital admission to discuss any out-of-pocket expenses associated to your stay.

Are you covered for things you don’t need? Or don’t have enough cover? Let Health Insurance Advocates know how we can help!

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- Rebecca Crook, VIC