Do you have private health insurance apart from Medicare?
Thread poster: Kristina Wolf

Kristina Wolf  Identity Verified
Australia
Local time: 21:53
Member (2004)
Spanish to German
+ ...
Jul 19, 2013

Hello all,

I realise this is a bit off topic in terms of work, but having relocated I am really struggling trying to understand how certain things work. We signed up with Medicare after countless paperwork and appointments since we moved from the UK and there is a reciprocal health agreement, but it took them 3 months to understand that no matter under which visa we arrived, the reciprocal health agreement stands. I would have happily not signed up if it meant we didn't have to pay the levy, but we were paying for a service we didn't have access to... anyway... we are now considering whether to supplement this with a private health insurance as the University where my husband works has special rates with one. We are a family of 3, a 14 month old and us, and I just wonder whether it makes sense. In the UK the National Health Service worked really well for us, even if at times it meant waiting for an appointment for weeks and having a private physio session in between or paying for something like acupuncture yourself, but it was way cheaper than paying regular contributions into a private health fund for us. I am keen to here your opinions or experiences to help me decide.

Kristina


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Petra Junge  Identity Verified
Australia
Local time: 21:23
Member (2009)
English to German
+ ...
Tough question Jul 19, 2013

Hi Kristina,
I remember that we were facing the same question when we arrived here eight years ago. Some people tell you that you would be mad not to have private health insurance, and others dwell on horror stories of people not being treated in hospital because they do have it. Although we have been with a private health provider for some years now, I am not quite sure if it's worth it. At the moment the benefits do by far not outweigh the premiums.

However, a factor that could influence your decision is if your or your husband's salary is higher than a certain threshold, because then you might have to pay more in taxes if you don't take up private health insurance. Another thing is your age. Once you hit 30 it gets more expensive to join every year. Although I have never lived in the UK I would assume that if the National Health Service worked for you there, Medicare might as well here.


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Daria Bontch-Osmolovskaia
Australia
Local time: 20:53
English
+ ...
it depends Jul 19, 2013

Hi Kristina,

There are two Medicare levies that Australian citizens (or "residents for tax purposes" - which is different from a citizen) have to pay:

1. Medicare levy. Everyone has to pay that, regardless of whether they have private health insurance or not. The only people who don't pay that are seriously low-paid families. You can't get out of this one. It's not very large, anyway, I think it's about $400-500 a year.

2. Medicare levy SURCHARGE. This you will have to pay if your combined family income is over 160K per year, or 100K (or 80K? I forget...) if you are single. This levy surcharge is 1% of your total income - so, assuming your family income is bang on 160K, you will have to pay $1600 per year. Now, if you take out private health insurance, the basic plan for that will also cost you $1600 per year, that's how they are geared. Or you can pay more, if you want to, but that's your choice. The benefit of this is that, in the end of financial year, you will NOT have to pay the levy surcharge, AND you will get a 20% rebate (aka tax credit) of the amount that you paid for private health insurance. Does that makes sense?

Basically, by taking our private health insurance, your benefits are:
- you won't have to pay Medicare levy surcharge
- you will get 20% of what you paid for health insurance back in tax credits, as a deduction (not a refund though)
- you will get private health insurance, and access to private health services
- your money will be benefiting your own family (via health insurance), and not going to the government as a tax.

You will still have to pay the Medicare LEVY, regardless of your income or amount of health insurance you take out. Whereas the SURCHARGE targets high income earners.

On the other hand, if your combined income is less than 160K a year, I would think whether you actually need private health insurance. If your health isn't too good, and you think you will make use of private health services - eg. shortened wait times for specialists, private room at a hospital, rebates on physio etc., then it's worth it. Otherwise, Medicare-funded public hospitals are very good. If you already got your Medicare card, you have access to ALL public services, however the wait lists can be very bad - e.g. public dental waitlist is 2-3 years, or an elective surgery maybe 5-6 years in coming! Whereas private health cover buys you what you need, when you need it, IF you need it


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Kristina Wolf  Identity Verified
Australia
Local time: 21:53
Member (2004)
Spanish to German
+ ...
TOPIC STARTER
Thank you both! Aug 5, 2013

Thanks for your input, we went for a bit of a compromise in the end, no private hospital cover, but extras cover.

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Do you have private health insurance apart from Medicare?

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