If you are reviewing your health coverage for Australia and would like to weigh up the differences between Medicare vs private health insurance, this blog is for you. 

Below, we will cover the key differences between private health insurance and Medicare. Plus, we will answer the questions, ‘What does private health insurance cover that Medicare doesn't?’ and ‘What does Medicare cover in Australia?’ 

Ultimately, our aim is to give you peace of mind so that you know what to expect when you need medical treatment—whether it’s a routine checkup, specialised treatment, medical test, or hospital care.

What Is Medicare?

Medicare is Australia’s national insurance scheme. It offers free or subsidised healthcare services and medications for Australian citizens and most Australian residents. 

Medicare helps cover the costs of visits to the emergency department of public or private hospitals. It also helps cover the cost of visits to doctors and certain other health practitioners. This includes eyesight tests with optometrists as well as diagnostic tests such as X-ray scans and blood pathology tests.

If you go to a doctor who bulk bills, you will not pay any out-of-pocket costs, as Medicare will cover these in full. If you go to a doctor who does not bulk bill, Medicare will subsidise a sizable portion of the cost, reducing your out-of-pocket payments. That said, there are limitations to what Medicare covers. This is where it is worth considering purchasing private health insurance coverage.

What Is Private Health Insurance?

In Australia, there are two kinds of private health insurance. One covers hospital fees, including overnight accommodation and care, along with theatre costs. The other covers general treatments such as physiotherapy and dental. Often, private health insurance can cover both (known as comprehensive health insurance), allowing you to be treated in private hospitals by your choice of doctor, surgeon or other health professional.

Do I Need Medicare If I Have Health Insurance?

Understandably, you may be wondering—do I need private health insurance if I have Medicare?

Firstly, it’s important to know that private health insurance and Medicare have two different offerings and can complement each other. But let’s also look at other factors.

If you are an overseas visitor from one of eleven countries (at the time of writing) that have reciprocal health care agreements (RHCA) with Australia, then you may be eligible for Medicare during your stay in Australia.

These countries include:

1.       Italy

2.       New Zealand

3.      Malta

4.      Finland

5.      Sweden

6.      Norway

7.      Belgium

8.      Slovenia

9.      Republic of Ireland

10.  Norway

11.    The UK

The level of coverage and what you need to be eligible differs according to Australia's individual agreements with each country, so it’s important to check how it affects you. Regardless, you should still get to know what private health insurance covers which Medicare doesn't. That’s because you may still have to consider buying OVHC health insurance to give you better coverage. 

If you are from a country that isn’t listed above, you are not eligible for Medicare and should take out OVHC insurance. In fact, in order to obtain a number of different types of visas, e.g. (500 visas), having OVHC insurance is obligatory. 

One of the best and fastest ways of comparing overseas visitor health insurance is via OVHC insurance. You will get a clear comparison across all available health insurance providers instantly and can easily click through to purchase the insurance of your choice.

Key Differences Between Medicare and Private Health Insurance

So, how do you decide how to approach your health coverage so you know what to expect? Some of the key differences between private health insurance and Medicare for you to consider are set out below. 

In-Hospital 

Private Health Insurance

Being a private patient:

- You have the freedom to select your hospital and the doctor and specialist who will treat you.

- Medicare will still cover a portion of your doctors' fees. If you have completed any applicable waiting periods, then your private health insurer will then cover a portion (or all) of the remaining doctors' fees as well as some or all of your hospital expenses (like accommodation).

- There may be additional gap payments that you may have to pay, such as excess costs.

Medicare

Being a public patient:

- You do not have the option to select your hospital or the doctor or specialist who will treat you.

- Medicare will cover the entire cost of your treatment at a public hospital.

Out-Of-Hospital, Such As Doctor Visits 

Private Health Insurance

- According to the law, private health insurance cannot cover medical services that are out-of-hospital, such as visits to a general practitioner, or specialist consultations. Diagnostic imaging and tests are also not covered.

Medicare

- Medicare covers a majority of exams and tests, including pathology tests and X-rays.

- Medicare covers the entire cost of visiting a bulk-billing doctor or medical specialist, as well as some of the costs for doctors or medical specialists who do not bulk-bill.

Ambulance Cover

Private Health Insurance 

- Ambulance services cover is included in certain policies.

Medicare

- While from a nationwide perspective, Medicare does not cover ambulance services, there may be exceptions according to the government policies of individual states and territories.

Extras Cover

Medicare does not cover extras, whereas private health insurance often does, though this depends on the particular policy you purchase.

The extras that private health insurance typically covers can include:

·         Ambulance services

·         Dental check-ups

·         General and major dental

·         Orthodontics

·         Physiotherapy

·         Optical

·         Chiropractic and Osteopathy

·         Podiatry

·         Speech Therapy

·         Hearing Aids

·         Dietetics

·         Approved Natural Therapies

·         Remedial Massage