How health funds work
Health insurance funds are not all the same. Some cover a wider range of treatments and procedures than others. And for any particular treatment, the rebate (what the fund will pay) can vary widely between funds or levels of cover with the same fund.
Any Gap payment or out-of-pocket expense is what you pay to your health professional. It is the difference between their standard fees and the rebate paid by your fund. Practitioners set their fees according to their business requirements. However, where there is a ‘preferred provider’ agreement in place, the fees have been agreed, so there is no or minimal gap.
It is advisable to be realistic about the treatment cover you are likely to require and do your research. This site can be a good place to start: www.privatehealth.gov.au
Health insurance fund models
When considering health insurance funds, respective business models affect premiums as well as the rebate amounts. There are large corporations, government-backed funds, members’ own and even restricted member funds.
Members’ own funds – or not-for-profit funds – are run for the benefit of members, not a corporation or shareholders. Many have ‘no excess’ hospital cover which means there is one less thing to worry about if/when hospital admission is required.
And most claim to offer generous rebates for Extras such as dentistry, physiotherapy and optical etc. Being not-for-profit, they can achieve this without affecting the company ‘bottom line’.
The restricted funds are a type of members’ own fund and include Police Health, Teachers Health Fund, Nurses Midwives Health and Emergency Services Health.
Head to Choice for their buying guide if you are new to health insurance, or to compare with your existing fund.