Why you should consider private health insurance

17 December 2024 6 minute read

Physiotherapist stretching the leg of a woman.

Australia is often called 'the lucky country,' and that extends to our healthcare system too. Thanks to Medicare, we can receive treatment in public hospitals without any charge, along with subsidised prescriptions and GP visits.

But there are limits to what Medicare covers, which is where private health insurance comes in. It helps bridge the gaps left by Medicare, ensuring you can access the care you need to stay healthy.

While private health insurance can seem pricey, it’s often more affordable than the hospital bills you might face without coverage, which can reach tens of thousands of dollars. At GU Health, we see ourselves as your partner in health, ready to guide you through the sometimes confusing healthcare landscape. That’s why we've created this health cover guide, to help you make the best choices for your situation.

What exactly is private health insurance?

Private health insurance is something you can purchase from a registered health insurer like GU Health. There are two main types of private health insurance, including Hospital cover and, Extras cover. Depending on the level of cover you select, with a private health insurance policy, you may be able to:

Be treated in a public or private hospital as a private patient
Have more choice when it comes to the treatment you receive in a private hospital setting, including where you stay and the doctor who performs your surgery (subject to availability)        
Receive a benefit for health services that are not covered by Medicare, including appointments with a physiotherapist, podiatrist or dentist
Be covered in an emergency for ambulance transport
Skip the public hospital waiting list if you find yourself in need of non-emergency surgery

Why should you consider Hospital cover?

1. Advantages of private health insurance during your hospital stay

Combined with Medicare, if you’re an Australian resident, your hospital health insurance will help cover the costs associated with your treatment as a private patient.

At GU Health, we have a team of health cover experts on-hand that can help you reduce – or completely remove – any out-of-pockets associated with your hospital stay; so, if you think you might need to go to hospital in the future, it’s best to give us a call on 1800 249 966 and discuss your options.

If your chosen level of cover includes your procedure and you attend one of the GU Health Agreement Hospitals, opens in a new tab (or any public hospital as a private patient) GU Health will pay benefits towards:

Hospital accommodation (i.e. your bed and a private room if there's one available)
Operating theatre fees
Intensive care fees
Labour ward fees
Meals
Common treatments and support treatments¹
Associated treatment for complications and associated unplanned treatment.²

If you’re a GU Health member, you should always check that your procedure is covered before you go to hospital and contact us, opens in a new tab so we can help you keep any extra expenses to a minimum.

2. Save on emergency ambulance costs

If you’re in an emergency situation with an ambulance on the way, you might be in for the most expensive ride of your life. And, if you’re one of the 30% of Australians, opens in a new tab who think Medicare will cover the cost, you’re in for a shock.

If you’re not covered by your State Government, most of our covers offer unlimited emergency ambulance cover³ so by taking out a GU Health cover you’ll get the help you need, when and as often as you need it.

3.   Peace of mind in emergencies

While public hospital healthcare (including emergency treatment) is free to all Australian citizens and most permanent residents, lengthy waiting times can apply if you need further treatment after your initial admission. Waiting for treatment has the potential to impact so many aspects of your life, including your ability to work, so avoiding public hospital waiting lists could save you time and money.

Some of our Hospital covers include Accidental Injury Benefit, meaning you'll receive benefits related to the accident in line with our Gold Hospital cover within 90 days after an accident if you present for treatment with a medical practitioner or attend an emergency department within 72 hours of the accident and are admitted to hospital. This includes admission to a private hospital or as a private patient in a public hospital. To check if you’re covered, log in to your member account or the GU Health App.

Learn how to quickly and easily check what you’re covered for in your member account or via the GU App.

4. Avoid long wait times in public hospitals

Without the right cover, wait times for non-emergency treatment in the public system can be weeks and even months. And if you choose to go to a private hospital without the right cover, your treatment won’t come cheap.

Taking out Hospital cover helps you avoid the long waiting lists you might experience in a public hospital. Data released by the Australian Institute of Health and Welfare, opens in a new tab showed that in 2022-23, the proportion of patients waiting more than a year on the elective surgery wait list increased to 6.3%⁴, with patients requiring a septoplasty (surgery to fix a damaged nose) waiting for a median of 365 days.

With the right level of GU Health Hospital cover, you choose when and where you get your surgery – meaning you can get back to work (and play) – quicker.

5. The freedom to choose

By having private health insurance, you may be able to choose your hospital and treating doctor. This gives you more choice, control and peace of mind that you're being treated by a doctor of your choosing. Search for a provider in our network using GU Health's Find a Provider, opens in a new tab tool.

Considering private health insurance

The peace of mind that comes with private health insurance is beneficial at any age, but you might have heard that it’s beneficial to take out a policy before turning 31.

That’s because if you don’t have Hospital cover by 1 July after your 31st birthday, you’ll pay a 2% Lifetime Health Cover Loading, opens in a new tab (LHC) on top of the normal premiums for each year you don’t have Hospital cover up to 70%. The loading applies for 10 years of continuous Hospital cover.

This isn’t just with GU Health, but every health fund. So, if you wait until you’re 40, you’ll pay 20% more than someone on the same cover who joined when they were 31.

How private health insurance can help you save money

There’s no denying private health insurance can be expensive, but in some cases it can save you money in the long run.

Save on everyday health services with Extras

Routine dental check-ups, physiotherapy sessions, and optometrist visits can quickly add up. This is where Extras cover can be beneficial.

Based on the Extras cover level you select, you can receive benefits for a variety of health services not covered by Medicare – such as dental, physiotherapy, and optical treatments – subject to annual limits.

Without Extras cover, these expenses would come straight from your pocket. So, if you frequently use these services, Extras cover could be a smart way to keep your healthcare costs in check over time.

At GU Health, we offer a range of Extras covers. These are some core inclusions that we pay benefits towards across most of our Extras policies:   

Preventative dental      
General dental      
Major dental      
Optical  
Physiotherapy

Depending on the Extras cover available through your corporate health arrangement, some of our Extras covers also provide cover towards the cost of popular treatments like osteopathy, dietary advice and orthodontia.

Tax time and private health insurance

If your taxable income is above $97,000 ($194,000 for families) and you don’t have an appropriate kind of private health insurance, you may have to pay the Medicare Levy Surcharge, opens in a new tab. This is an additional 1% to 1.5% in tax on top of the Medicare Levy we all have to pay.⁵

If eligible, you could avoid the Medicare Levy Surcharge – and pay less tax – by joining any GU Health Hospital cover and maintaining it for the full financial year. If you take out Hospital cover part-way through the financial year, (if eligible) you will avoid the surcharge for the period you held suitable Hospital cover.

Interested in becoming a GU Health member?

Talk to your Member Relations Team or call us on 1800 249 966.

¹Common treatments include a number of Medical Benefits Schedule (MBS) items commonly used across services covered by your policy. Support treatments means a number of MBS items used to support a principal treatment covered by your policy. Common and support treatments will be covered in line with the level of cover your product provides for the principal treatment.

²Associated treatment for complications means treatment provided during an episode of covered hospital treatment to address a complication that arises during that episode. Associated unplanned treatment means unplanned treatment provided during an episode of covered planned treatment that is, in the view of the medical practitioner providing the unplanned treatment, medically necessary and urgent. Associated treatments will be covered in line with the level of cover your product provides for the principal treatment.

³1 day waiting period applies. Not available to: (i) QLD residents who have ambulance services provided by their State ambulance schemes; (ii) TAS residents who are covered under state ambulance schemes in TAS and when travelling in mainland Australia except SA and QLD; or (iii) pension and health care card holders who have ambulance services provided by State ambulance schemes (check entitlements with Centrelink if unsure)

⁴When compared to 2021-22.

⁵If your income is over $97k for singles ($194k for couples/families) and you take out and maintain Hospital cover for the full financial year, you could avoid paying an extra 1% to 1.5% in tax via the Medicare Levy Surcharge (MLS).  Visit the Australian Tax Office website for specific rules for calculating income for MLS purposes. This information is accurate as of 1 July 2024. See the ATO website for changes that may be made to income tiers from time to time.