Many millennials are ditching private hospital health plans due to steadily rising premiums. It is not hard to understand why they are running away from paying for decent medium hospital insurance plan… [read]
A waiting period is a necessary evil in the world of health insurance – it prevents people from joining health funds only to speed-claim before cancelling their membership, driving up premiums for everyone else. It does so by enforcing a “hold-out” period on payable benefits for new members and certain procedures.
Waiting periods apply when you first join a new fund or upgrade to a new membership level.
At least, the reforms to Private Health Insurance Act 2007 have gone into effect across Australia and benefit limitation periods (the infamous BLPs) have been removed since July 1st, 2018.
But maneuvering through various terms and policies of private health insurer still remains challenging. Each health insurance policy has their own rules on waiting periods based on a variety of factors, making comparing policies a bewildering task. For the truly lucky (or simply proactive), however, there are ways to get the waiting periods waived.
Few Facts About Current Waiting Periods
It is essential that you understand how you make claims for both public and private care services with your own insurer .
- Holding a general treatment (extras) policy does not count towards waiting periods for a hospital policy
- If you transfer to a new policy, your previously completed waiting periods should be recognised by your new insurer.
- If you transfer to a higher level of cover, you will need to wait for 12 months before being able to access higher benefits for pre-existing conditions and will only have access to lower level benefits during that time
For hospital covers, the government decides on the maximum waiting periods per Private Insurance Act of 2007.
Here’s the latest summary as of Jan 2019:
Up to 12 months for pre-existing conditions
- Any condition of which you had symptoms before you joined the fund even if said condition had not been diagnosed
- Exceptions are psychiatric, rehabilitation and palliative care
Up to 12 months for obstetrics (pregnancy)
- Advised to get yourself and your unborn child appropriate policy before conception (i.e. transferring to a family or single parent membership) as each fund has varying policies on how far in advance you must transfer
- Most cheaper hospital covers will either exclude obstetrics or only pay limited benefits only if you stay in a public hospital
Up to 2 months for mental health
- Previously, you had to upgrade to hospital covers with higher benefits for psychiatric treatments and wait for 2 months before accessing said benefits
- Starting April 2018, a 2 month-wait is no longer required if you have completed a minimum 2 month waiting period under your overall hospital cover (this upgrade only allowed once in your lifetime)
<Information from Australian Government Private Health Insurance Ombudsman>
General Treatment (Extras Cover)
Unlike for hospital treatments, waiting periods for extra covers depend on the insurer (and procedures), ranging from 2 months to 3 years . Here are some industry averages:
- Two months for general dental check-ups/services and physiotherapy
- Six months for optical items (glasses or contact lenses)
- 12 months for major dental procedures
- One to three years for some high-cost procedures such as orthodontics.
<Information from Commonwealth Ombudsman Private Health Insurance Guide>
How To Get Your Waiting Periods Waived
There are no private insurers, for both hospital and general treatment, that do not impose waiting periods. However, a smart buyer knows how to rely on the market competition! Many private insurers offer promotions to attract new members.
June and December (financial and calendar year ends) are the most popular times for new promotions .
A little tip – you can also try to negotiate with your existing insurer, especially if you see them offering deals to new customers. You have relatively decent bargaining power. Yield it! Note that these promotions will likely only apply to general treatment/extra covers, not hospital treatments.
Do not switch your insurance provider just for the waiver or gift cards – it’s very important to take a comprehensive approach and find one that covers areas of your current and future needs. Also, you must maintain continuity of coverage (within 30 days of leaving your provider) to ensure that your new provider will recognise your completed waiting periods.
Use Member Own’s comparison tool to take the first step towards finding yourself a more convenient health fund!
“What Do I Do If I Need Treatment During My Waiting Period?”
You should seek guidance from your doctor and contact your insurer first. Your insurer will get your permission to comb through your medical records and rely on an independent medical advisor to determine whether your condition is pre-existing.
If you get admitted to a hospital without consulting with your insurer, you might be liable for the entire expense. If you pay for all or part of cost upon admission and your insurer concludes that you are eligible to claim benefits, you will be able to apply for rebates.
If your treatment is urgently needed, you should consider going to a public hospital as a public patient. However, there’s often a time lag between setting up your appointment and getting the procedure for public services. According to Grattan Institute’s State Orange Book 2018, half of the public patients wait more than a month for an elective hospital procedure such as hip replacement. 10% wait for over 6 months.
“Are There Other Ways to Get Savings for Private Health Insurance?”
Australian government offers an income-based rebate program to help you with the cost of private health insurance. You can go to the website of The Department of Health to check your eligibility and the rebate rate you are eligible for.