Overseas Health Cover Australia: Everything You Need to Know
If you’re an Australian expat or foreign investor living overseas, you need to be aware of the risks associated with not having adequate health insurance.
In Australia, the public health system (Medicare) provides free or low-cost healthcare to Australian citizens and permanent residents. However, if you’re not a citizen or permanent resident, you won’t be eligible for Medicare. This means that you’ll be responsible for paying for all of your own healthcare costs, which can be very expensive.
Understanding Australia’s healthcare system, including the role of Medicare, the prevalence of private health insurance, and the implications of the LHC loading, can help expats make informed decisions about their healthcare coverage during their time in Australia. Let’s dive in.
What Kind of Healthcare Does Australia Have?
Australia boasts a robust, high-quality healthcare system that caters to its diverse population. This system is a mix of public and private healthcare providers, with the public healthcare system, known as Medicare, playing a pivotal role.
How Does Australian Medicare Work?
Medicare is Australia’s universal healthcare scheme that provides citizens and permanent residents with access to a wide range of health services at a low or no cost. It covers many essential medical services, including doctor’s visits, specialist appointments, and hospital treatment.
Funded through tax contributions, Medicare is accessible to all Australian residents, regardless of their income or health status. It also provides benefits for specific out-of-hospital treatments and subsidizes the cost of most prescription pharmaceuticals.
How Much Does Medical Cover Cost in Australia?
The cost of private health insurance in Australia varies greatly, depending on factors such as the level of cover, your age, and your lifestyle. On average, private health insurance for a single adult can range from AUD $100 to $200 per month, although policies with more comprehensive coverage can be more expensive.
What is the LHC Loading?
One aspect expats should be aware of is the Lifetime Health Cover (LHC) loading, introduced in 2000. This loading aims to encourage individuals over 30 to secure private health insurance and alleviate the strain on Medicare. Essentially, for each year over 30 without private patient hospital cover, a 2% loading is added to insurance premiums, up to a maximum of 70%. However, after maintaining continuous hospital cover for ten years, the loading is lifted.
Avoiding the LHC Loading: Key Strategies
To avoid or minimize the impact of Lifetime Health Cover (LHC) loading as an expat returning to Australia, consider the following key strategies:
- Secure hospital cover within one year of returning: If you were living abroad on the 1st of July following your 31st birthday, make sure to obtain hospital cover within one year of your return to Australia. This will exempt you from LHC loading.
- Maintain continuous private health insurance coverage: Ensure you have continuous private hospital cover while living abroad. Gaps in coverage may result in LHC loading when you reapply for private health insurance upon your return.
- Return before turning 31: If you plan to return to Australia, consider doing so before your 31st birthday. This will exempt you from the LHC loading, as the loading is not applicable until after you turn 31.
- Understand the absences rule: Familiarize yourself with the rules regarding absences from Australia and their impact on LHC loading. If you were overseas on the 1st of July 2000 and have accumulated 1,094 days of absence, you may be exempt from LHC loading upon your return.
Why You Need Overseas Health Cover
There are a number of reasons why you need overseas health cover. First, as mentioned above, if you’re not a citizen or permanent resident of Australia, you won’t be eligible for Medicare. This means that you’ll be responsible for paying for all of your own healthcare costs, which can be very expensive.
Second, even if you do have Medicare, it may not cover all of your healthcare costs. For example, Medicare doesn’t cover dental care or prescription drugs.
Third, even if Medicare does cover your healthcare costs, you may still have to pay a significant amount out of pocket. For example, the average out-of-pocket cost for a hospital stay in Australia is over $5,000.
Overseas health cover is particularly important for expats for several reasons:
- Access to quality healthcare in host countries.
- Comprehensive coverage for routine check-ups, preventive care, and pre-existing conditions.
- Continuity of care for ongoing medical conditions or specialized treatments.
- Coverage for emergency medical services, hospitalization, and surgeries.
- Provision for medical repatriation or evacuation in case of severe emergencies.
- Peace of mind and a safety net in a new healthcare environment.
How to choose the right overseas health cover policy
When choosing an overseas health cover policy, there are a number of factors you need to consider. These include:
- The level of cover you need
- The cost of the policy
- The policy’s terms and conditions
It’s important to choose a policy that provides you with the level of cover you need. You also need to make sure that the policy is affordable and that the terms and conditions are fair.
Proactive Planning for Australian Expats
Securing private hospital cover upon your return to Australia can save you significantly in the long run, given the potential penalties associated with the LHC loading. Remember to plan ahead – don’t leave securing health cover until the last minute.
Make sure to collect necessary documents to ensure correct LHC loading, if any. Obtain a Clearance Certificate from your previous insurer if you’re switching providers or rejoining after a hiatus. Request an International Movement Record from the Department of Home Affairs to verify your travel dates for LHC purposes.
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Frequently Asked Questions (FAQs)
The cost of overseas health insurance Australia varies depending on a number of factors, including the level of cover you need, your age, and your health status. However, you can expect to pay between $50 and $200 per month for a comprehensive policy.
No, Australian health insurance does not cover overseas expenses. If you’re an Australian citizen or permanent resident who is traveling overseas, you will need to purchase separate overseas health insurance.
OSHC Australia is a type of overseas health insurance that is specifically designed for Australian students and temporary visa holders who are living in Australia. OSHC policies typically cover the cost of doctor’s visits, hospital stays, and prescription drugs.
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