Understanding theHealth Care System
Before transition Australian Health System & Medicare
After transition Overview of healthcare costs Public and Private systems Negotiating healthcare costs
Government incentives, penalties and rebates Key private healthcare considerations
Healthcare overseas
2
What is this session about?
Register for your Medicare card (through Dept of Human Services) All Australian citizens and Permanent Residents must be
registered with Medicare You are now responsible for all healthcare costs. If you are single, you must register for a card, or you can add
yourself to a family card
Understand Australia’s healthcare system DVA entitlements and coverage (NLHC) Public healthcare system = Medicare Private healthcare = elective option funded by you
Before you transition…
After transition…healthcare
Medicare Benefits Schedule (MBS)
fee subsidises doctors services
• Specialists service fee - 85% Medicare rebate on the MBS fee
• General Practice Service fee – 100% Medicare rebate on the MBS fee
• X-rays, pathology and optometrist performed eye tests• Health plans for mental health and chronic disease
management
Pharmaceutical Benefits Scheme
subsidies prescription
medicines
• Subsidies prescription medications capped at $40.30
Medicare subsidises health services out of hospital through:
Service Service Cost MBS / PBS Fee You Pay
GP Bulk Billing $37.60 $37.60 $0.00
GP Short Consult $86.00* $37.60 $48.40*
GP Long Consult $125* $72.80 $52.20*
Specialist Fee $500* 85% MBS Fee Balance*
Pharmaceutical (PBS) $120.00* $79.70 (balance) $40.30 max
* Examples only costs vary by provider
Out of Hospital scenarios
Medicare covers 100% of costs on admission to a public
hospital as public patient
The hospital will choose the doctors and specialists who
treat you
Waiting lists may apply and are on a needs basis
Public Hospital treatment
Public Hospital – private treatmentHave right to be treated as public patient (even with insurance)You must consent to private treatment and may incur charges Private patient treatment may not provide all of the benefits afforded to a private patient in a private hospital
Private Hospital treatment
You can choose your doctor or
specialist
No waiting periods for treatment
Medicare pays 75% of the MBS fee for specialist doctor
You pay the balance of the doctors total
fee
You should ask about out of pocket costs before treatment
Private Hospital charges
Private Health Insurance - Gap cover agreements Insurers provider ‘Gap Cover Agreements’ may cap or eliminate out-of-
pocket costsClinician’s may participate in = No Gap / Known Gap / No AgreementBe an informed consumer – use of referrals is open
Negotiating your care and treatment
Know the costs of treatment = Informed Financial Consent (Ombudsman)You are entitled to ask your doctor, fund and hospital about gap payments Confirm gap payments with your clinician and hospital before surgery
Health fund will pay all or most of hospital costs
WITHOUT Gap Cover Scheme
USING Gap Cover
Scheme
Surgeon’s fee $700 $538.40MBS fee $334.35 $334.35
Medicare pays 75% of MBS $250.80 $250.80
Fund pays 25% of MBS $83.55 $83.55
Additional benefit paid by fund to doctor as a Gap Cover provider
N/A $204.05
Patient pays
$365.65 for procedure +
$250 health insurance
excess
$0 for procedure +
$250 health insurance
excess
Out of pocket (Gap) scenarioe.g. Colonoscopy in an agreement hospital
Government Incentives
Federal Government Rebate on PHI
Make PHI more affordable
Ease pressure on public hospital system through uptake of Private health insurance
Means tested and indexed rebate – essentially lower % each year
Applies to both hospital and extras cover
www.privatehealth.gov.au
SinglesFamilies
<= $90,000<= $180,000
$90,001-105,000$180,001-210,000
$105,001-140,000$210,001-280,000
>= $140,001>= $280,001
REBATE
Base Tier Tier 1 Tier 2 Tier 3
< Age 65 25.059% 16.706% 8.352% 0%Age 65-69 29.236% 20.883% 12.529% 0%Age 70+ 33.413% 25.059% 16.706% 0%
Government Penalties
Medicare Levy Surcharge (MLS)
All civilians pay the 2.0% Medicare Levy
(through tax return)
Surcharge (MLS) applies to higher income
earners without an appropriate level of
hospital cover
Full-time ADF personnel are exempt
(except where household is not covered and
combined income exceeds threshold
Lifetime Health Cover Loading (LHC)
Penalty for over 30s when you eventually
take out private hospital cover
2% loading on premium for each year over
age 30 without cover to max 70
Loading is removed after 10 continuous
years of hospital cover
Allowed 1094 days without cover over
lifetime without incurring this penalty
Special conditions for full-time ADF
membersNo MLS Tier 1 Tier 2 Tier 3
Single <90K 90K – 105K 105K – 140K >140K
Family <180K 180K – 210K 210K – 280K >280K
All Ages 0% 1% 1.25% 1.5%
Treatment you need -when you need it
Choose when you get care (avoid waiting lists)
Choose who provides the care
Choose where you receive the care
Empowers you to manage your care
Access government benefits
Considering Health Insurance?
Balance between price, level of cover and excess
Use government tiers (Gold/Silver/Bronze/Basic)
Review your cover at different life stages (lower your excess)
Consider DVA and NLHC coverage
Cover needs to suit your lifestyle (risks)
www.privatehealth.gov.au
Comparing Hospital Cover
Premiums reflect the value of benefits
Balance between price, limits & benefits
What will you use, what is important?
Lower premiums or higher benefits
Don’t take extras cover if you will not use it!
Considering Extras Cover
Medicare only covers limited extras services referred by a GP Benefits will vary between funds/covers Benefits typically paid per item benefit or percentage of fee
Choosing Heath Insurance
Waiting Periods• Hospital – 2 months (12 months for pregnancy &
birth)• Extras covers – 2 to 12 months (generally)
Pre-existingConditions • 12 months (even if not formally diagnosed)
Transferring • Don’t be afraid to switch funds – never locked in!
Open versus Restricted funds
• Open funds – open to all consumers to join• Restricted funds – access to particular groups only• Navy Health and Defence Health are not-for-profit
health funds tailored to needs of ADF• Family are also eligible (siblings, parents, children)
www.privatehealth.gov.au
Overseas Travel & healthcare
Consider travel insurance when you
travel overseas
Private health insurance does not cover you outside
Australia
Covers costs of emergency
treatment and evacuation
(1) Register for a Medicare card (through Dept of Human Services) On separation, you are responsible for all healthcare costs ADF Family Health program is no longer available
(2) Understand Australia’s healthcare system Public healthcare system = Medicare Private healthcare = elective option funded by you Public and private compliment each other Be informed on your DVA entitlements and coverage (NLHC)
(3) Understand Government incentives and penalties
(4) Remember Medicare and insurance don’t apply overseas
Key takeaways…
Questions?