How Does Extras Cover Health Insurance Work & How to Claim
Whether you’re considering buying Extras cover for the first time or recently experienced a significant life change, for example becoming a parent, you're probably wondering whether extras insurance is worth the money, which plan to choose and how to claim.
The key to making an informed decision about an Extras health insurance plan is to examine what different health funds have to offer, how much it costs, what their waiting periods are, and what’s not covered.
This article endeavours to clarify Extras private health insurance and the process of claiming.
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Health insurance extras only
Private health insurance policies only providing Extras cover without Hospital insurance. Note; Extras only cover does not help you avoid the Medicare Levy Surcharge, you need to purchase an appropriate level of Hospital insurance for that.
Extra and hospital cover combined
Private health insurance policies only providing Extras cover without Hospital insurance. Note; Extras only cover does not help you avoid the Medicare Levy Surcharge, you need to purchase an appropriate level of Hospital insurance for that.
Extras only health cover options
Depending on your health insurance provider, there are usually 3 categories of extras only policies to choose from:
Basic extras
Generally, the cheapest option, offering a limited number of extras. Typically, includes general dental, chiropractic, physiotherapy, and optical cover, with a set annual limit usually lower than the Medium extras insurance packages.
Mid/Medium
A more expensive, but generally still affordable option providing increased limits for a broader range of services, like some major dental, podiatry, and occupational therapy – in addition to what the basic plan covers.
Top/Comprehensive
The most expensive plan, covering a comprehensive range of services. Generally including everything offered in the basic and mid options, including orthodontics, hearing aids, psychology and blood glucose monitors at a higher annual limit.
Always read your health insurance extras only Standard Information Statement (SIS) which provides you with a detailed summary of the general treatments included in your policy. This statement can be found on the PrivateHealth.gov.au website.
Do I need extras cover?
Whether you need extras only health insurance or should combine it with your hospital policy should generally depend on your unique circumstances, including your past and current health, your age, family responsibility and what you can afford.
According to the most recent APRA Private Health Insurance statistics, at 30 June 2018, over 13 million people in Australia, about 54.3% of the population, have some form of ancillary cover. Benefits receiving the highest amount of payouts include:
- Dental,
- Optical,
- Physiotherapy, and
- Chiropractic
A general list of treatments found in an extras health insurance policy
General dental: Basic dental coverage, including teeth cleanings and small fillings.
Major dental: Moe extensive treatment is required, for example, crowns and dentures.
Orthodontic: Correction of mispositioned teeth, using braces and retainers.
Endodontic: Microsurgical procedures, like root canal therapy.
Optical: Prescribes glasses and contact lenses.
Physiotherapy: Remediating impairments and improve mobility with manual therapy and exercise.
Chiropractic: Help with the proper alignment of the body’s musculoskeletal structure, mostly the spine.
Non-PBS Pharmaceuticals: Medicines prescribed by your GP that's not listed on the Pharmaceutical Benefit Scheme, so Medicare generally does not pay for such prescriptions.
Hearing aids: Small, battery powered devices that amplify sound signals beneficial for people with hearing loss.
Blood Glucose monitors: Measures your blood sugar levels, typically beneficial to people needing assistance managing their diabetes.
Psychology: Helping people improve their lives by supporting them to overcome challenges.
Podiatry: Prevention, diagnosis and treatment of disorders of the foot, ankle and lower extremities.
Acupuncture: The use of thin needles as an alternative form of medicine to treat injuries and illnesses.
Remedial Massage: Assessment and treatment of your muscles, tendons and ligaments with the use of therapeutic based massage.
Naturopathy: Natural, non-invasive medicines and practices. As of April 2019, private health insurers will no longer cover certain natural services, for example, homoeopathy.
The above list serves merely as a guide of the popular choices that might be included in a general treatment health cover policy.
Compare Ancillary Cover Options
7 Considerations to help you decide if you need extras cover
Your age
For example, a young and healthy Australian with good vision and excellent teeth might rarely require general treatment services, whereas a person over the age of 65 might be thinking of the expenses associated with things like hearing aids, hip and joint replacements and major dental procedures.
Your health
Deciding if you need extras insurance depends on your health care requirements. The needs of a growing family will be vastly different from that of a single person. Also, your past and current health and your family’s medical background should be taken into account; if you have a history of mental or physical ailments, you might need financial support to cover the costs of future treatments and services.
Your budget
The cost of extras health insurance should be considered before purchasing a policy. Consider how much you'll need to claim back on the services you'll most use and whether the premium you'll pay justifies the return. If you're on a tight budget and don't have a family and are still young and healthy, it likely won't make financial sense to purchase a comprehensive policy when a basic one will do.
Out-of-pocket expenses
When reviewing extras insurance options, be sure to consider the gap payment required, i.e. the amount of money you'll have to pay after the private health insurance and Medicare benefits are paid. This is called your out-of-pocket costs and usually includes medical gap, excess or co-payments for ancillary services
Waiting periods
Health funds may have different waiting periods – the amount of time you’ll have to wait before you can start claiming benefits. For example, the general waiting period for pre-existing conditions is 12 months. So, if you need immediate treatment for something and don't have extras health insurance, purchasing it now might be a waste of money if you can't wait for the predetermined period to pass before needing the benefit.
You might also want to check the waiting list for elective surgeries before you purchase a health insurance policy.
Your limits
- Annual limits refer to the amount you can claim on benefits each year, meaning the amount you can get back is capped.
Lifetime limit is the maximum benefit paid to an individual for specific services, for example, orthodontics.
Sub-limits are usually applied to particular benefits within a larger limit, per person, per year. For example, you might have a $300 combined limit for physiotherapy and chiropractic, with a sub-limit of $200, meaning the most you can claim yearly for one of the services is $200, with the remaining $100 to be spent on the other service you've not yet claimed.
Your limit is dependent on the level of cover you choose; basic, medium or comprehensive. However, rather than paying a fixed amount (e.g. $190), you might gain more value from a policy offering to pay out a percentage of your bill for each treatment, usually from 60% up to 100%.
List of recognised providers
Many private health insurers have a network of health providers with whom they've negotiated deals for their members. For example, a set percentage return or discount for a specific service, which will help lower your overall out-of-pock costs. Check which providers are listed under the extras health funds you're considering.
Is getting health insurance extras worth it?
If the premium you pay annually will be higher than the benefits you’ll receive, and you do not anticipate your health needs changing anytime soon, then general treatment cover might not be worth it for you. However, if you’re starting or growing your family or nearing retirement age, investing in a quality general treatment policy might save you lots of money.
How to claim health insurance extras
- Claim on-the-spot by swiping your membership card at the electronic claiming terminal or HICAPS. You then pay the remaining balance.
- Claim online by logging in to the health fund's membership portal and following the instructions.
- Download the app: Use your smart phone to download your health insurer’s claiming app and submit your receipts and documents via the app.
- Manual claiming: Fill out a healthcare insurance claim form, which you can download from the insurer's website, attach your invoice and receipt and post it to the insurer or deliver it in person to their address.
Before you go for treatment, check with your health fund to see if they have a preferred provider which may give you a discount or a higher percentage back.
What is HICAPS?
HICAPS stand for Health Industry Claims and Payment Service. You just swipe your card at the designated terminal, wait for your benefit to go through, and pay the difference if there is any. Most places accept HICAPS, but if they don’t have such a system, you can always pay in full and submit your claim via the insurer’s online portal.
When would my insurer not pay out for an extras claim?
Private health funds will usually not pay an extra claim if:
- The benefit is not covered in your policy, or
- You’ve reached your limit, including yearly, lifetime or service limit,
- You are still serving the pre-determined waiting period, or
- The private health insurance does not recognise the provider for the benefit purpose,
- When a third party already provided a benefit, including Medicare, a Government body, or another insurance company.
- Treatment was received outside of Australia.
Before deciding whether you should buy extras insurance, shop around and compare what different health funds have to offer.
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