Inpatient vs outpatient care

Any healthcare you receive from the hospital as an admitted patient is considered inpatient care, regardless of the type of care. However, being treated in a hospital doesn’t necessarily mean you’ve been admitted. Here are a few common examples of inpatient care:

• Planned elective surgery
• Surgery after being admitted from the emergency department
• Monitoring and treating a serious illness
• Diagnostic tests as an admitted patient (e.g. colonoscopies, endoscopies and blood tests).

Outpatient care refers to any medical care received without being admitted to a hospital. In some instances, this may still take place within a hospital such as emergency room care and consultations in a doctor’s office. Examples of outpatient medical services include:

• Some minor surgeries without an overnight stay (e.g. laser eye surgery)
• Ambulatory care
• Medical screening (e.g. blood tests, x-rays and mammograms)
• Physiotherapy
• Dialysis.

When you’re admitted to hospital as a private patient, a hospital cover policy could pay towards your hospital and doctors’ fees when the required hospital service is included with your policy, and you’ve served the necessary waiting periods.

When you claim on your hospital insurance, your health fund and Medicare will work in tandem to pay 100% of the Medicare Benefits Schedule (MBS) fee for your doctors, which is the amount the government has deemed appropriate to charge.

However, health professionals are free to set their own fees, so if they charge over the MBS fee, you may have to pay the difference as an out-of-pocket cost. Depending on your health fund, some or all the difference could be covered by your insurer’s gap cover scheme.

You may also need to pay an excess or co-payment, depending on your policy. An excess is a flat amount you pay per hospital admission, while a co-payment is an amount you may pay for each day of your hospital stay, typically up to a maximum number of days.

For outpatient procedures and services that Medicare pays a benefit towards, like check-ups with your GP, private health insurance is legally prohibited from offering cover. However, for outpatient services that aren’t included on Medicare, an extras cover policy could help with your costs.

Extras cover benefits are usually offered as a flat dollar amount or a percentage. With a percentage benefit, a set percentage amount is listed for a specific medical procedure and your health fund will cover that percentage of the cost charged by your provider. For a dollar amount benefit, your health fund will pay a flat benefit for a procedure, regardless of what your health care professional charges.

Both types of benefits will typically also be subject to limits. At a minimum, extras policies will come with annual limits, which is the total amount you can claim on a specific treatment each year. There are also other types of limits like lifetime limits, sub-limits, and group limits.

For treatment as a public patient in a public hospital, Medicare will cover the full cost, so you won’t need to pay a thing. This includes all medication, lab tests and any required follow-up care. However, for elective surgery through the public healthcare system, you will need to join a public waiting list.

The amount of time you’ll spend on a public waiting list will depend on the surgery you require and the severity of your symptoms. If you want to fast-track your elective surgery, you can go through the private healthcare system instead. When you’re treated privately, Medicare will still pay a partial benefit alongside your private health insurance.

Medicare can pay towards a range of outpatient services listed on the MBS. The exact amount Medicare will rebate can depend on several factors like the type of service, whether you hold a concession or healthcare card.

Typically, Medicare will pay 100% of the MBS fee for GPs and 85% for specialists and medically necessary diagnostic tests. Medicare can also pay towards some medications through the Pharmaceutical Benefits Scheme, and some mental health services through the Better Access initiative. For the full details of what Medicare can cover out of hospital, talk to your doctor or a Medicare representative.