Relocating to Australia brings exciting opportunities, but also requires careful consideration of healthcare needs. Australia boasts a robust healthcare infrastructure, blending public and private options, but navigating it can be complex for newcomers. Many expats require private health insurance, from providers such as Cigna Global, as a condition of their visas.
This guide will help you understand the different types of insurance (including family coverage and partner coverage), choose the right insurance for you, and give you peace of mind as you settle into your new life Down Under.
Legal Requirements and Immigration Rules
Understanding the legal landscape of healthcare in Australia is essential for expats. Medicare, Australia’s public health system, is generally not available to temporary residents. Expats who become permanent residents or citizens can access Medicare benefits but should be aware that Australia has financial incentives in place to encourage higher earners to take out private insurance.
For UK citizens, the Reciprocal Health Care Agreement (RHCA) between Australia and the UK provides some relief. Under this agreement, UK residents visiting Australia are eligible for medically necessary treatment under Medicare. However, this coverage is limited, making private health insurance advisable for long-term stays. It is also only available to those who were living in the UK (not abroad) prior to coming to Australia.
It’s important to note that requirements vary depending on the specific visa subclass. Some visas may require a higher level of coverage than others. For instance, student visa holders must have Overseas Student Health Cover (OSHC), while 457 and 482 visa holders need to maintain a specified level of private health insurance throughout their stay. You can read more about types of visas and how to apply here.
Students from the UK may be eligible for Medicare under the RHCA.
Medicare Levy Surcharge and Lifetime Health Cover Loading
The Medicare Levy Surcharge (MLS) and Lifetime Health Cover (LHC) Loading are two financial mechanisms designed to encourage Australians, including expats, to take out private health insurance.
The Medicare Levy Surcharge applies to individuals and families earning above a certain income threshold who do not have private insurance. The surcharge ranges from 1% to 1.5% of taxable income, depending on earnings, and is in addition to the standard Medicare Levy.
Lifetime Health Cover Loading is a financial penalty applied to individuals who take out private hospital insurance after the age of 31.
Here’s how LHC Loading works:
- If you don’t have private hospital cover by July 1st following your 31st birthday, you will pay an additional 2% on your premium for each year you delay getting cover.
- For example, if you wait until you’re 40 to take out private medical insurance, you will pay 20% more on your premium (2% for each year over 31).
- The maximum loading is capped at 70%, so even if you wait longer, the penalty won’t exceed this threshold.
- The good news is that once you maintain private hospital cover for 10 continuous years, the LHC Loading will be removed, and your premium will return to the standard rate.
For expats, there’s generally a 12-month grace period to sign up for private insurance after arriving in Australia to avoid LHC Loading.
Types of Health Insurance Coverage
Australia’s healthcare system offers two main types of coverage: public and private. Medicare, available to permanent residents and which provides free or subsidised care, covers doctor visits, public hospital treatments, and most prescription medications.
Private health insurance fills this gap with two primary components:
- Hospital cover: Pays for in-hospital treatments as a private patient.
- Extras cover: Covers out-of-hospital services like dental, optical, and physiotherapy.
Insurers offer these separately or as combined policies.
Private insurance offers faster access to treatments, a choice of doctors, and coverage for services not included in Medicare.
What Health Insurance Typically Covers in Australia
Hospital coverage includes accommodation, surgery, and in-hospital treatments. General treatments, or extras, encompass services like dental, optical, physiotherapy, and chiropractic care.
Dental coverage is particularly important, as prices can be high in Australia. A basic cleaning without insurance coverage might cost around AUD 150-200, while more complex treatments, such as a crown, can exceed AUD 1,500.
Prescription medication coverage varies, with some drugs subsidised under the Pharmaceutical Benefits Scheme (PBS) and others covered by private insurance.
Medications covered under the PBS are listed on the PBS Schedule, and their costs are significantly reduced. However, certain high-cost or specialised drugs may need to be covered by private health insurance. These may include some high-cost treatments, newer medications, or specific brand-name drugs. Private insurance policies typically cover part or all of the expense, depending on the plan’s terms.
Certain medicines are not available in Australia at all, so you may need to speak to a healthcare provider to discuss alternatives or explore special access schemes that allow some unapproved medicines to be prescribed under specific circumstances. Some common medications which are not available in Australia include Adderall, Zolpidem (Ambien), Hydrocodone (Vicodin), and Chantix (Varenicline). Certain high-cost biologics are not available under Medicare/PBS. While some biologics are subsidised under the PBS, newer or niche treatments for autoimmune diseases or rare conditions may not be listed and can be extremely expensive without private insurance.
Emergency services, including ambulance transport, are often included in comprehensive policies, though coverage may differ by state.
The extent of coverage depends on the chosen policy, with higher-tier plans offering more extensive benefits, so be sure to carefully review policy details.
Health Insurance Options and Costs
Expats in Australia have several private insurance options to consider:
A. International health insurance plans cater specifically to expats, offering global coverage and often including benefits like repatriation. These plans can be advantageous for those frequently travelling or anticipating returns to their home country.
B. Australian private health insurance providers offer local coverage tailored to the Australian healthcare system. Major providers include Bupa, Medibank, and nib, among others.
When comparing features and benefits, international plans typically offer broader geographical coverage and may have higher limits, while Australian plans are often more cost-effective for local care and better integrated with the Medicare system.
Typical costs vary widely based on coverage level and family size. For individuals, basic hospital cover might start around AUD 800-1,200 per year, while comprehensive hospital and extras cover could range from AUD 2,000-4,000 annually. Family plans generally cost 2-2.5 times the individual rate, potentially ranging from AUD 2,000-10,000 per year depending on the level of coverage.
Considerations for Those With Families/Partners
Family health insurance in Australia typically offers coverage for couples and families with children. These policies often provide broader benefits, including paediatric care and family counselling.
For partner visa applicants, adequate health insurance is mandatory, covering both the applicant and any dependents.
Pregnancy and childbirth coverage is a crucial consideration for many expat families. While Medicare covers most pregnancy-related services for eligible residents, private insurance can offer additional benefits like choice of obstetrician and private hospital accommodation.
Most policies impose a 12-month waiting period for pregnancy coverage, so planning ahead is essential.
Choosing the Right Health Insurance Plan
Selecting the right health insurance plan involves considering factors like pre-existing conditions and planned treatments and comparing costs, including premiums, excesses, and out-of-pocket expenses. Pay attention to coverage limits, excluded treatments, and in-network providers. Get a tailored quote here.
Be aware of waiting periods, which can range from a few months to a year for certain treatments, especially for pre-existing conditions.
Additional Health Insurance Considerations
For expats in Australia, several additional health insurance considerations are crucial to ensure comprehensive coverage:
A. Travel Insurance for Trips Outside Australia: While Australian health insurance provides coverage within the country, it typically doesn’t extend to international travel. Expats should consider purchasing travel insurance for trips abroad, including visits to their home country. Some international health insurance plans may include this feature, offering seamless coverage both in Australia and overseas.
B. Repatriation Coverage: Repatriation coverage is vital for expats who may need to return to their home country for medical treatment or in case of death. This coverage typically includes the cost of medical evacuation, which can be extremely expensive if paid out of pocket.
C. Mental Health Coverage: Mental health support is an important consideration, especially given the challenges of expat life. Be aware that some policies may have limits on the number of mental health sessions covered per year.
Why You Should Get Insurance Before Your Move
Comprehensive health insurance is vital for expats in Australia, fulfilling visa requirements and ensuring care when it’s needed. Be sure to keep a detailed record of all medical expenses and treatments. Many Australian insurers offer online claim submission and mobile apps for convenience.
Ultimately, finding the right insurance safeguards both health and finances. Ticking it off the list now means you can focus on your move and fully embrace your Australian experience.