Medical insurance vs Medicare Loading

[unzippy]

Wasn't sure if this belonged in the Health or Finance section - so I put it here

I've had a letter from the government telling me that I need to take out private medical insurance or face an increased loading on my medicare.

What's the cheapest option?

In terms of previous health history - I've never had health insurance in the UK, or even been registered with a GP.  I've reached 40 without ever going to a hospital (unless it's work or visiting), I get a cold once a year and that's about it.  So I guess I've pretty lucky so far.

 

[Marisawright]

My husband is in his sixties and still doesn't have health insurance.  I have to say, when I look at what I've paid in premiums since I turned 40, it's about $40,000.  During that time he's had cataract surgery, a colonoscopy and a melanoma removed, which have cost him less than $15,000. So I'm not convinced I got the better deal!

I've kept my insurance up because I worried I'd need it more when I get old.  However, my friend's father is in his 80s, still doesn't have health insurance, and a couple of years ago he had a spinal fusion, free of charge on Medicare.  I had the same op, with my private health insurance, and the "gap" was nearly $10,000.  Makes you wonder.

 

[Toots]

51 minutes ago, Marisawright said:

My husband is in his sixties and still doesn't have health insurance.  I have to say, when I look at what I've paid in premiums since I turned 40, it's about $40,000.  During that time he's had cataract surgery, a colonoscopy and a melanoma removed, which have cost him less than $15,000. So I'm not convinced I got the better deal!

I've kept my insurance up because I worried I'd need it more when I get old.  However, my friend's father is in his 80s, still doesn't have health insurance, and a couple of years ago he had a spinal fusion, free of charge on Medicare.  I had the same op, with my private health insurance, and the "gap" was nearly $10,000.  Makes you wonder.

 

I know a chap here who was as deaf as a post and had a hearing aid.  Medicare covered all expenses for him to go to Melbourne to be sorted out with a cochlear implant.  Didn't cost him a cent.

[Skani]

4 hours ago, unzippy said:

I've had a letter from the government telling me that I need to take out private medical insurance or face an increased loading on my medicare.

What's the cheapest option?

 

How much will the increased loading cost you?

[unzippy]

4 minutes ago, Skani said:

How much will the increased loading cost you?

I don't know. it mentions 2% for every year I'm over 30 but doesn't say of what - how would I find that out?

[Marisawright]

42 minutes ago, unzippy said:

I don't know. it mentions 2% for every year I'm over 30 but doesn't say of what - how would I find that out?

There are two increases.

One, if you don't have health insurance then you pay a surcharge on the Medicare levy - but only if you're earning over $90,000 per annum (or $180,000 for couples).  The surcharge is 1% to 1.5% of your taxable income.  

Two, if you don't take out health insurance by the time you're 30, then if you take out private health insurance when you're older, you'll pay a loading on the premiums, which gets higher the longer you delay. Sounds like Unzippy is referring to the second one.  It's 2% of the premium.

Are you new to Australia, because as a migrant you have 12 months' grace from the time you arrive in Australia, even if you're older than 31. 

https://privatehealth.gov.au/dynamic/lifetimehealthcover.aspx

 

 

Edited June 29, 2018 by Marisawright

[unzippy]

Yep, I'm new.  Landed December 2017.

[Marisawright]

1 hour ago, unzippy said:

Yep, I'm new.  Landed December 2017.

OK that explains it.  

Australians have to take out health insurance by the age of 31, otherwise they start getting slugged for higher and higher premiums as they get older. 

New migrants get a reprieve - even if you're already over 30, you can get health insurance at normal rates.  You've got 12 months from your arrival to decide.

If you decide not to get health insurance before your 12 month anniversary, you are basically making the decision not to have private health insurance ever - because if you change your mind when you're, say, 50, you''ll be paying an extra 40% every year (so for instance, my annual premium is about $2,500 but you'd be charged $3,500).

[Skani]

On 29/06/2018 at 11:51, unzippy said:

I've had a letter from the government telling me that I need to take out private medical insurance or face an increased loading on my medicare.

 

This is still a bit hazy.   If the letter said you would face an increased loading on your Medicare  - as you stated - then it is a result of you earning an income amount which incurs a Medicare Surcharge Levy (added to your tax liability)  if you don't have private hospital insurance.

If the letter said you would face an increased loading on private health insurance  if you don't commence it now,  then it is the age related increase as outlined by Marisawright above.

Edited June 30, 2018 by Skani
clarity

[Beffers]

21 hours ago, Marisawright said:

OK that explains it.  

Australians have to take out health insurance by the age of 31, otherwise they start getting slugged for higher and higher premiums as they get older. 

New migrants get a reprieve - even if you're already over 30, you can get health insurance at normal rates.  You've got 12 months from your arrival to decide.

If you decide not to get health insurance before your 12 month anniversary, you are basically making the decision not to have private health insurance ever - because if you change your mind when you're, say, 50, you''ll be paying an extra 40% every year (so for instance, my annual premium is about $2,500 but you'd be charged $3,500).

Yep I arrived June last year and took out health insurance in March this year. Got the letter few weeks ago as our 12 months grace period was almost up. Think they send it to all new migrants who are approaching the end of their first year with Medicare. 

Edited June 30, 2018 by Beffers

[unzippy]

Thanks people.  However I'm still no wiser what to do.

The only time I can see me needing medical help is if I get knocked me off my push bike.  Am I right that Medicare will cover that, if I get myself to hospital?

[s713]

We had basics 'plus' + hospital + something else and it was $140 a fortnight ($3600 pa). All we ever seemed to claim for was my wife's glasses (half of $600) and a couple of dental appointments a year. So, way out of pocket. I had a hernia op one year and I was able to choose my preferred date and time and have a private room. Without the private, I would've waited a bit longer and been on a ward. Anyway we cancelled ours. Until we did our tax return and you get penalised big time. So, I'm back on basics now, as advised by tax man.

[unzippy]

15 minutes ago, s713 said:

We had basics 'plus' + hospital + something else and it was $140 a fortnight ($3600 pa). All we ever seemed to claim for was my wife's glasses (half of $600) and a couple of dental appointments a year. So, way out of pocket. I had a hernia op one year and I was able to choose my preferred date and time and have a private room. Without the private, I would've waited a bit longer and been on a ward. Anyway we cancelled ours. Until we did our tax return and you get penalised big time. So, I'm back on basics now, as advised by tax man.

Penalised to the tune of more than $3600?

Edited July 2, 2018 by unzippy

[s713]

2 minutes ago, unzippy said:

Penalised to the tune of more than $3600?

No. But enough to cover basic cover.

[Amber Snowball]

On 02/07/2018 at 03:19, unzippy said:

Thanks people.  However I'm still no wiser what to do.

The only time I can see me needing medical help is if I get knocked me off my push bike.  Am I right that Medicare will cover that, if I get myself to hospital?

Which state are you in? If you are in Victoria which for some reason I think you are, get ambulance cover regardless as private health only covers life threatening emergency which basically means not breathing. It’s not expensive and it will cost you about $900 for an ambulance to attend without it, running into thousands if they intubate! This applies even if a well meaning passerby calls the ambulance for you.

[unzippy]

Yep, Melb.

 Blimey, how much does it cost to call the Police or Fire Services?

[Amber Snowball]

7 hours ago, unzippy said:

Yep, Melb.

 Blimey, how much does it cost to call the Police or Fire Services?

Why do you think God gave you 2 of things? So you ca sell one to pay for stuff......

[Emma_M]

It’s things like this that make me worry about coming to Australia and what healthcare we will need, we take it for granted that we can just call 999 and get an ambulance if we need it, without worrying how much it will cost

Do people think it would maybe be worthwhile just putting money by instead of having additional private health insurance??

Is it common for workplaces to offer private health insurance, dental cover etc?

 

 

 

[Amber Snowball]

1 minute ago, Emma_M said:

It’s things like this that make me worry about coming to Australia and what healthcare we will need, we take it for granted that we can just call 999 and get an ambulance if we need it, without worrying how much it will cost

Do people think it would maybe be worthwhile just putting money by instead of having additional private health insurance??

Is it common for workplaces to offer private health insurance, dental cover etc?

 

 

 

It is quite an individual choice based on your earnings/age etc. If you are young and healthy not earning over $88000 ish as a single (can’t remember exactly the threshold)  then I wouldn’t bother. Ambulance cover varies state to state so check where you are headed. 

Not sure if the private sector would offer health cover but I’ve never had it offered!

Ambulance cover in Victoria isn’t much, about $45 for a year for a single.

Hospital cover simply means you bypass the waitlist for surgeries at the end of the day. They crap on about you can choose your surgeon, that’s lovely but who the hell knows enough about all the local surgeons to make that choice, you then have to have a GP referral with your  surgeon named on it, you go for an out patient consult which your private doesn’t cover, so Medicare pays and you pay the gap fee then if you don’t like them and want to change, you need another GP referral because it has to be addressed to the surgeon so you can’t use the first one and off you go again paying for the original consult........

Private insurance doesn’t cover all the costs either, doctors/surgeons fees aren’t regulated so they can charge what they want and if it is over what Medicare say it should cost then you pay the gap again.

We had insurance and used it for a few procedures but if I had stayed in Aus I would have cancelled it, it is quite expensive.

Anyway, rant over!

[Marisawright]

6 hours ago, Emma_M said:

Do people think it would maybe be worthwhile just putting money by instead of having additional private health insurance?

That's exactly what my husband has always done.  He's definitely ahead of the game so far!   However, the issue is that you may not put the money aside - there's always a temptation to spend it, whereas the money on health insurance just comes out of your bank account every month. 

As Amber says, they are always rattling on about how private health insurance allows you to choose your surgeon and get a private room in the hospital - but I think we Brits, being used to the NHS, wouldn't see the need for either of those things.

[Marisawright]

On 02/07/2018 at 12:19, unzippy said:

Thanks people.  However I'm still no wiser what to do.

The only time I can see me needing medical help is if I get knocked me off my push bike.  Am I right that Medicare will cover that, if I get myself to hospital?

What if you get knocked off your bike and have three teeth knocked out?  Medicare does not cover dentists, that's all private. 

Also, it's not just the question of your needs now, it's your needs in the future.  As they point out, if you don't take insurance now, and then you decide you need it later, you''ll be slugged with a penalty ("loading"). 

My husband's in his 60's, barely been near a doctor in his life, but after 60 almost everyone needs some medical attention.  He's had cataracts removed, a varicose vein op, two skin cancers (both of which needed plastic surgery).  He's never had health insurance because he thought it was a rip-off, so he's paid for those things out of his own pocket.   

He is starting to think it might be a good thing now he's older, BUT it's too late. If he wanted to take out health insurance now, his premium would be nearly double what I'm paying, thanks to that loading. 

So that's why people get health insurance. One, to reduce their tax (and if you go to a tax agent, as I've been suggesting you do, they will work out your Medicare surcharge and can tell you whether it's worth getting health insurance).  The other is because they'd rather pay it now than wait till they're older, when they need it, and pay through the nose.

[unzippy]

Thanks Marisa.

I guess i should go see a tax agent then

[ramot]

52 minutes ago, Marisawright said:

What if you get knocked off your bike and have three teeth knocked out?  Medicare does not cover dentists, that's all private. 

Also, it's not just the question of your needs now, it's your needs in the future.  As they point out, if you don't take insurance now, and then you decide you need it later, you''ll be slugged with a penalty ("loading"). 

My husband's in his 60's, barely been near a doctor in his life, but after 60 almost everyone needs some medical attention.  He's had cataracts removed, a varicose vein op, two skin cancers (both of which needed plastic surgery).  He's never had health insurance because he thought it was a rip-off, so he's paid for those things out of his own pocket.   

He is starting to think it might be a good thing now he's older, BUT it's too late. If he wanted to take out health insurance now, his premium would be nearly double what I'm paying, thanks to that loading. 

So that's why people get health insurance. One, to reduce their tax (and if you go to a tax agent, as I've been suggesting you do, they will work out your Medicare surcharge and can tell you whether it's worth getting health insurance).  The other is because they'd rather pay it now than wait till they're older, when they need it, and pay through the nose.

Sadly Marisa I have to agree with you on the age thing. Until the last couple of  years I thought I was a reasonably fit 70+ year old. I know that on our visa we have to have health cover as not entitled to Medicare, but honestly it’s been one thing after another these last few years.. I might not have had full return for my health fund costs over quite a few years but I have had far far more back recently than paid in and am more than appreciative of the care and expertise received. 

We receive the full costs back on our fund with no gap to pay, but it isn’t cheap. Dentist costs are only part covered and they are very expensive.

Also picking up on another post, I have a good Dr. and trust the advice on which specialist to be referred to, no complaints so far or felt the need for another referral.

 

[Merryweather]

Really interesting discussion!

We are about to depart for Oz on a 143 visa (so 60+ and 50+) which I know entitles us to Medicare. My question is - if we have basic health ins. dental, optician, ambulance - can we still use Medicare for all other health related stuff?

[Tulip1]

On 02/07/2018 at 03:19, unzippy said:

Thanks people.  However I'm still no wiser what to do.

The only time I can see me needing medical help is if I get knocked me off my push bike.  Am I right that Medicare will cover that, if I get myself to hospital?

No one knows when they will need care. Just because you've never needed it they doesn't mean you're only likely to need it if you get knocked of your bike.  There are a great many people (especially men) who suddenly have a heart attack in their 40's, a lot more common than many people realise. They'd probably said the same as you the day before it happened. I've never been in hospital and I'm older than you but I'm aware that could change at any time.