Private health insurance helps cover the cost of your healthcare, from hospital treatment to everyday services like dental, optical, and physio. Depending on your policy, it can cover all or part of your treatment costs as a private patient in a public or private hospital. This often means you get to choose your doctor, where you’re treated, and when giving you more control over your care. Unlike other types of insurance (like home or car insurance), private health insurance in Australia is community rated. That means everyone pays the same base price for the same policy, it’s not based on your health status or personal risk. There are two main types of cover: Hospital cover; helps pay for hospital treatment as a private patient and Extras cover; that helps pay for services not covered by Medicare, like dental, optical, or physio. You can take out one or both, depending on your needs and budget. One of the biggest benefits of private health insurance is choice and flexibility. As a private patient, you can usually:

• Choose your doctor and treatment hospital (as long as your insurer has an agreement with them).
• Schedule your procedures or appointments at a time that suits you.
• Avoid long public hospital waiting lists once you’ve served your policy waiting periods.

In short, private health insurance gives you more options, more control, and often, faster access to the care you need.

Private health insurance in Australia is designed to give you more choice and control over your healthcare. It’s generally split into two main types of cover: Hospital cover; helps pay for the costs of being treated as a private patient in hospital and Extras cover (also called general treatment cover); that helps cover everyday health services that Medicare doesn’t, like dental, optical, or physio. You can choose either type of cover on its own, or combine them into a single policy, depending on your needs. In some states, there’s also ambulance cover, which may be offered separately or included in your hospital or extras policy.

Because private health insurance is community rated, everyone pays the same base premium for the same policy regardless of their health or medical history. Health funds can’t refuse to cover anyone who’s eligible. To balance this fairness, insurers apply waiting periods, specific timeframes you must wait before claiming benefits on certain treatments or services. The government sets the maximum waiting periods for hospital cover:

• 12 months for pre-existing conditions
• 12 months for pregnancy, obstetrics, and IVF
• 2 months for psychiatric care, rehabilitation, or palliative care (even for pre-existing conditions)
• 2 months for all other circumstances

For extras cover, unlike hospital cover, waiting periods vary between health funds and depend on your policy and treatment type. To claim benefits, your policy must include the treatment you’re receiving, and your waiting period must be complete.

If you switch insurers but keep the same level of cover, most funds will recognise waiting periods you’ve already served, this goes for both Hospital and Extras cover.

The private health insurance rebate is a government initiative that helps make private health cover more affordable for Australians. It’s a percentage discount that the government contributes toward the cost of your private health insurance premiums – whether you have hospital cover, extras cover, or a combined policy

The amount of rebate you receive depends on your:

• Income – higher-income earners receive a smaller rebate or none at all.
• Age – older Australians are eligible for a higher rebate.

The rebate is designed to encourage more people to take out private health insurance and ease pressure on the public health system.

You can choose how you receive it:

• Up front, as a reduced premium, your health fund applies the rebate directly, so you pay less each time you’re billed.
• At tax time, as a tax offset through your annual income tax return.

The Australian Government reviews rebate levels each year, so the exact percentage may change over time.

If you’re not sure which rebate tier you fall into, your health insurer or the Australian Taxation Office (ATO) can help you check your eligibility and current rates.

The difference between what Medicare covers and what private health insurance covers depends on the type of service you’re looking at.

Hospital cover

Medicare pays 75% of the Medicare Benefits Schedule (MBS) fee for medical services if you’re treated as a private patient in a public hospital. The remaining costs may be covered by your health insurer, depending on your policy and level of cover.

Your private hospital cover can include:

• The remaining 25% of the MBS fee
• Hospital accommodation
• Theatre and intensive care fees
• Drugs, dressings, and other consumables used during treatment
• Surgically implanted prostheses
• Diagnostic tests
• Pharmaceuticals
• Any additional doctor’s fees above the MBS fee (if your doctor has an agreement for gap cover)

Having hospital cover also means you can often choose your doctor, your hospital, and even your treatment time, giving you greater flexibility and potentially avoiding public hospital waiting lists (after serving any applicable waiting periods).

Extras cover

Medicare’s benefits for everyday health services are limited. That’s where extras cover can make a big difference.

Medicare doesn’t cover things like:

• Most dental services
• Glasses and contact lenses
• Hearing aids and related appliances
• Physiotherapy, chiropractic, and other allied health services
• Ambulance transport (except in some states)
• Services provided through the private system
• Services not listed on the MBS

When it comes to prescription medicines, Medicare only helps pay for drugs listed on the Pharmaceutical Benefits Scheme (PBS). If your medication isn’t on the PBS, Medicare won’t contribute, but your private health insurance might, depending on your extras cover and the type of medication prescribed.

In short, private health insurance fills the gaps left by Medicare, giving you more choice, faster access to care, and cover for services that support your overall health and wellbeing.

Lifetime Health Cover (LHC) loading is a government initiative designed to encourage Australians to take out private hospital cover earlier in life and keep it long term.

If you don’t take out hospital cover before 1 July following your 31st birthday, you may have to pay an additional loading on top of your premium when you eventually join.

Here’s how it works:

• For every year you’re aged over 30 when you first take out hospital cover, you’ll pay an extra 2% loading.
• The loading is capped at 70%, meaning if you wait until you’re 65 or older to take out hospital cover, you could be paying 70% more than someone who joined before 31.
• The loading only applies to hospital cover (not extras cover).

Once you’ve held continuous hospital cover for 10 years, the loading is removed, provided you maintain your policy without long gaps.

There are some exceptions and grace periods. For example:

• New migrants to Australia have 12 months from the date they receive their Medicare entitlements to take out private health cover without incurring a Lifetime Health Cover loading.
• If you’ve had hospital cover previously but dropped it, a 1,094-day (roughly 3-year) absence is allowed before the loading resumes.

In short, Lifetime Health Cover loading rewards consistency, the earlier you join and the longer you stay covered, the less you’ll pay overtime.

No – Medicare does not cover ambulance services.

Instead, ambulance cover is managed by each state and territory, meaning what you’re entitled to (and how you’re billed) depends on where you live and your personal circumstances.

ACT

Residents who hold a Health Care Concession Card or a Full Aged Pensioner Concession Card are entitled to free emergency ambulance services. If you don’t hold a concession, you’ll need to arrange ambulance cover through a private health fund.

New South Wales (NSW)

If you hold a Health Care Concession Card, Pensioner Concession Card, or Commonwealth Seniors Health Card, you’re entitled to some free ambulance transport services. Others can take out ambulance cover through their private health fund.

Northern Territory (NT)

Holders of a Health Care Card or NT Centrelink Pensioner Concession Card receive free ambulance transport. All other residents can purchase cover through a private health fund or the state ambulance service.

Queensland (QLD)

Ambulance services are fully covered by the Queensland Government for all residents – no separate insurance required.

South Australia (SA)

Residents can purchase ambulance cover through a private health fund or directly from the state ambulance service.

Tasmania (TAS)

Ambulance costs for Tasmanian residents are generally covered by the state government.

Victoria (VIC)

Residents who hold a Pensioner Concession Card or a Health Care Card are entitled to free, clinically necessary ambulance transport. Other residents can purchase cover through a private health fund or the state ambulance service.

Western Australia (WA)

Residents holding a Pensioner Concession Card are eligible for free medically necessary ambulance transport. If you’re not eligible, you can purchase cover through a private health fund or the state ambulance service.

All of Australia

Holders of a Veteran Gold Card or Veteran White Card may be eligible for free emergency ambulance transport to the nearest clinical facility. Some non-emergency transport may also be covered, depending on the Department of Veterans’ Affairs guidelines.

Travelling interstate

Ambulance cover doesn’t always transfer across state lines. For example, Queensland and Tasmanian residents who receive free ambulance services in their home state may not be covered when travelling in Victoria or elsewhere.

Before travelling interstate, it’s best to check with your state ambulance service, concession card provider, or health fund to make sure you’re covered in an emergency.

For more information visit our Ambulance Cover guide or contact your state Ambulance Service.