Medicare does not cover the costs of emergency transport or ambulance services, which is why it’s important to arrange your own cover. Generally, you can purchase ambulance cover as part of your hospital cover or extras cover, or even as standalone cover.
However, depending on the state you live in, you may not even need ambulance cover, or you may be eligible for a discount. Check out our guide to ambulance cover for further information.
Important information for you to know
The Australian Government Private Health Insurance Rebate
If it’s the price of the premiums that’s making you a tad hesitant to invest in private health insurance, you’ll be happy to hear that the government can give you a helping hand. The private health insurance rebate is income tested and applies to hospital, extras, and ambulance policies.
Many Australians are eligible for the rebate, based on the following three conditions:
- You must be eligible for Medicare;
- You must have complying health insurance product (CHIP) that provides hospital cover, extras cover, or both;
- You must have an income for Medicare levy surcharge purposes below Tier 3, as shown in the table below.
You can claim your private health insurance in one of two ways: as a premium reduction through your health fund, or as a tax offset when you lodge your annual tax return. If you want to use the former method, contact your insurer to discuss the matter, and if you prefer to do the latter, your insurer can provide you with the right paperwork for your tax return. More information can be found at the Australian Taxation Office website.
Medicare Levy Surcharge (MLS)
The Medicare Levy Surcharge (MLS) is another compelling reason to consider health insurance. It is levied on Australian residents that earn above a certain income and do not have private health cover. The MLS was devised by the government to prompt more people to invest in the private healthcare system, so as to ease the demand on Medicare.
As of April 2017, the surcharge is calculated at the rate of 1% – 1.5% of your income, in addition to the Medicare Levy of 2% which most Australian taxpayers pay.
Lifetime Health Cover (LHC) loading
When it comes to private health insurance, ‘sooner rather than later’ is always a good policy to adopt. That said, nothing proves that more than the Lifetime Health Cover (LHC) loading. This is a government initiative to encourage Australians to invest in health insurance earlier in life. If you take out hospital cover after 1 July following your 31st birthday, you’ll pay a 2% loading (on top of your premium) for every year you didn’t have cover.
For example, if you purchase hospital cover when you’re 40, you will be paying an extra 20% on top of your premium. And if you purchase it when you’re 50, you’ll be paying 40% more! The maximum loading you can pay is 70%. But after you have held private hospital cover for ten consecutive years, the LHC loading is removed.
The LHC loading applies only to hospital cover, not extras cover. In some cases, working out your loading can be tricky, so be sure to refer to our Lifetime Health Cover calculator.
‘Switch it up’
When our children are young, their bodies are constantly growing and developing. So it makes sense that their health needs will also change as well! Chances are the first health insurance policy you purchase won’t be suitable for your family forever.
With that in mind, make a point of consistently re-evaluating your private health cover as time goes on. This will ensure you’re getting the most out of your policy at any given time as well as help you keep track of what you should be regularly claiming on. For example, you might not be considering having more children at this point, but that may change a few years down the line.
Many people think that switching from one health insurance provider to another is complicated. It’s actually a straightforward process. The other great news is that there are no penalties or surcharges involved when you switch providers. This means that:
- Your Lifetime Health Cover status remains the same, with any age loading or absence of loading transferred to your new policy.
- You will still be eligible for any rebates you’re receiving on your current cover; and best of all, waiting periods will be waived (provided you have observed the full waiting period for your previous policy and you don’t have any new or upgraded benefits).
Look out for your loved ones
When it comes to looking after your children’s health, having a helping hand can be a lifesaver. This is why private health insurance can be so beneficial for parents with young children. Having both hospital and extras cover means that you can rest assured knowing that your family’s health will always be in the best of hands.
Want to make a head start on shopping around for health insurance? Find something to suit your family’s lifestyle on our website, or speak to one of our health insurance experts on the phone if you have any questions.
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