Contributed article for The Student Housing Company.
When you’re a student you don’t always have a lot of spare money, so if you’re looking for health insurance you want to try to make sure you are getting bang for your buck.
There are a lot of policies available in the Australian market today, so where do you start?
There are health insurance products suited to students who are residents in Australia, as well as overseas students, along with a range of coverage from basic hospital through to comprehensive policies including extras.
Here’s our round up of what to consider when comparing policies.
What is private health insurance?
Private health insurance can help cover the cost of a variety of medical treatments and services. When you take out health insurance, you pay a premium to your health fund. The amount you pay will differ based on the policy and level of cover you select, your family group (how many people are being insured), and the state or territory you live in. Lifetime loading may also affect the cost of your insurance after the age of 31.
There are typically two types of private health insurance – hospital cover and extras cover. Hospital policies can help cover the costs associated with in-hospital treatment and accommodation. Extras policies provide benefits to help you pay for general treatment or ancillary services, such as physiotherapy, optical and dental.
Most health insurance funds will allow you to combine your hospital and extras cover into one combined policy or will give you options to mix and match your cover into a policy that suits your needs.
Medicare vs health insurance
In Australia, we have private health insurance available, as well as public health cover, known as Medicare. It is important to know the difference between the two when researching your options.
Medicare is Australia’s universal healthcare system funded by taxes. Under the system, Australian and New Zealand citizens (residing in Australia for six months or more) and permanent residents of Australia are entitled to free treatment and accommodation at public hospitals, free treatment by some general practitioners (if they bulk bill) and a rebate for treatment by some specialists.
Medicare subsidises a number of essential healthcare services, however it does have limitations when it comes to providing financial support when accessing certain treatments as well as the flexibility of choosing where you are treated and by who.
For those wanting access to additional services, private health insurance should be a serious consideration.
Some potential benefits of having private health insurance include:
· The option to stay in private hospital rooms
· A wider choice of hospitals to choose for treatment
· Avoiding hospital waiting lists for elective (or non-emergency) surgery
· Access to certain government rebates
· Locking in surgery dates rather than being placed on priority patient orders
· Selecting the doctor or surgeon you want to carry out your operation or treatment
· Cover for some specialist services such a dental work.
Considerations for Australian students
There are various factors you may want to consider when comparing private health care policies:
If you have any pre-existing conditions or a history of illness or injuries, then you may want to look for health insurance policies that can provide cover for any future treatment for these sorts of medical issues. This could include private hospital cover for short hospital stays (such as for an endoscopy) or extras for ongoing needs (such as optometry). If you do have a pre-existing condition, keep in mind a waiting period may apply on hospital treatment benefits.
On the flip side, if you are young and in good health, you could consider taking out a policy that does not include cover for services that may not be needed, such as obstetrics or knee/hip replacements, in return for a lower premium.
If you are an active person, or regularly access complementary therapies such as physiotherapy, podiatry or chiropractic, you may want to consider extras cover. If you have a manual job, or a love for extreme sports or risky activities, you may want to look into a higher level of hospital cover in case you are injured.
Most funds have comprehensive comparison tools that can show you the difference in premium depending on what coverage you want. It could also be a good idea to take into account any savings or discounts available through particular health funds, such as paying your premiums annually rather than monthly, or if there are any corporate discounts through your employer. You could also consider opting for a higher excess in return for a lower premium. Excess is the amount you pay towards hospital treatment under your health cover. Conditions on the excess charged will vary between health funds.
It is also important to be aware of out-of-pocket expenses when considering your health fund options. If a medical treatment costs more than what you get back from Medicare or health insurance, this is called a gap or out-of-pocket expense. Some health funds may have gap cover agreements with certain practitioners or hospitals to help cover all or some of the expenses.
If you are covered by your parents’ policy (up to age 24)
Until you turn 18, you’re considered a dependent and are automatically covered under your parents’ family policy (unless you’re married). Between the ages of 18 and 24, it’s up to your insurer to decide whether or not you can be considered a dependent; Many of them attach some conditions to this, such as requiring you to be a fulltime student. You can often also stay as a dependent in return for a greater insurance premium, the size of which is up to the health fund. Once you turn 25, you’ll need to take out your own health insurance if you want to be covered.
What is Overseas Student Health Cover (OSHC)?
If you’re an overseas resident studying in Australia, then one of your student visa requirements is that you must have health insurance for the duration of your stay. This is known as Overseas Student Health Cover (OSHC).
Students from some countries with reciprocal healthcare agreements may not need to purchase OSHC as they will be covered by Medicare. This currently includes students from the United Kingdom, Sweden, the Netherlands, Belgium, Slovenia, Italy and New Zealand.
OSHC is designed to provide a level of cover for medical and hospital care, transport in an ambulance and some pharmacy medicines.
Standard OSHC policies will not cover ancillary services such as dental or optical, so if you require these treatments you may need to take out extras OSHC cover or consider private health insurance with an Australian health fund. You can also supplement OSHC with international travel insurance.
Read the product disclosure statement of the policy you are considering for details on what is and is not covered and if any waiting periods apply.
Where can I get OSHC cover from?
There are five Australian health funds currently authorised to provide OSHC for overseas students. These are ahm, BUPA, Medibank Private, NIB and Allianz Global Assistance. You can purchase this insurance through your educational institution or online through the provider’s website.
Costs will vary between providers, so it may be worth comparing options online or calling the insurer directly to discuss what they can offer.
Remember, because OSHC is a visa requirement, it is important to maintain your cover throughout your stay and to inform your insurer of any changes to your visa status or Medicare eligibility in case this impacts the level of cover you hold.
Mitch Watson is Group Manager of Research and Ratings at Canstar. He has been working in finance research for over 10 years. Over this time he has developed a deep understanding of financial products and what consumers and businesses need to be looking for to get ahead.
Disclaimer: This advice is general and has not taken into account your objectives, financial situation, or needs. Consider whether this advice is right for you. Consider the product disclosure statement (PDS) before making any financial decision. For more information, read Canstar’s Financial Services and Credit Guide (FSCG).