Why You Need Private Health Insurance—Now
You may be the last generation of Aussies to rely on public health insurance. The Medicare system has been fiercely debated, and many politicians have called it unsustainable. In addition, the Australian government provides incentives for people to switch the private health insurance.
What should you do among all this uncertainty? The answer: buy private health insurance now. You’ll still need health care if Medicare changes drastically.
What Does Public Health Insurance Cover?
Right now, almost anything you’d need. Australians can receive hospital treatment for free, and the government will pay 85% of out-of-hospital treatments. And if your medical bills get too high, Australia will cover them.
That sounds great, doesn’t it? So why is Australia working so hard to promote private insurance?
Mostly because public insurance is so great—for the person receiving treatment. For the government, those payments are heavy to bear, even with the 1.5% income tax to support Medicare. That’s why they’ve stepped into the private insurance arena with Medibank.
What Exactly Does Medibank Do?
Medibank is a private insurance company owned by the Australian government. Sounds a bit contradictory, I know, but Medibank pays taxes just like any other private business. The government uses Medibank to manipulate the private insurance market. Medibank sets low premiums for health insurances, and other insurance companies must cut prices to compete.
However, these low prices come at a cost. You’ll face a waiting period of two months before Medibank will cover your medical procedures, as well as a twelve-month waiting period for pre-existing ailments or obstetric treatments.
Will the Government Pay for Your Insurance?
Private insurance may sound like a drag, but the government will help you make the switch. Right now, Australia will pay 30% of your premiums when you buy a private insurance policy.
Why Do You Need Insurance Now?
If that 30% rebate doesn’t motivate you to buy private cover, maybe the Lifetime Health Cover will.
Under this act, the longer you wait to buy private hospital insurance, the higher your premiums will be. Companies will include a 2% loading starting when you’re 31, and they’ll keep adding 2% each year for 10 years. So if you first buy insurance when you turn 40, your premium will be 20% higher than market rates.
Think about your future and the future of our country. To keep yourself protected for life, switch to private insurance while it’s this affordable.