KNOWING WHAT YOU’RE COVERED FOR (AND NOT COVERED FOR) WITH YOUR HEALTH INSURANCE POLICY IS CRUCIAL. HERE’S WHAT YOU NEED TO KNOW ABOUT RESTRICTED TREATMENTS IN PRIVATE HEALTH INSURANCE IN AUSTRALIA.
When it comes to hospital insurance policies and hospital treatment in Australia, there are certain rules set by the Australian government and the private health insurance ombudsman to ensure fairness and transparency.
Different insurance products offer various levels of coverage, and whether you're seeking private hospital cover, coverage for elective procedures, or want to be prepared for potential hospital costs and medical treatment, it's important to understand the limitations and benefits of your policy.
In this guide, we’ll be covering everything you need to know about restricted services and some of the limited benefits that come with certain levels of hospital cover.
Let’s get straight into it with the three types of treatment cover.
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1. Restricted Service
Restricted services are treatments that your health insurer will partially cover, which means you may have out-of-pocket expenses. Since the 2019 private health insurance reforms, all health funds must offer restricted cover for:
hospital psychiatric services
Typically, however, full coverage is available with gold level cover.
2. Covered/Included Service
When a service is covered or included in your policy, your health insurer will pay the full benefit for the treatment, as long as it's listed in your hospital cover policy. This means that if you're treated as a private patient in a private hospital, Medicare typically covers 75% of the MBS costs, and your private health insurance covers the remaining 25%.
3. Excluded Service
Exclusions are treatments that your health insurer will not provide any benefit for. For instance, if you have basic or bronze level of cover, you may not be covered for pregnancy and birth, leading to significant out-of-pocket expenses.
Pro tip: All health insurance funds are required to cover specific services. Explore our comprehensive guide to the four tiers of health insurance: basic, bronze, silver, and gold.
How Restricted Treatments Affect You
When it comes to restricted services in health insurance, it's important to understand the impact on your expenses.
Typically, you'll have larger out-of-pocket costs because the full cost of treatment is not covered.
Even if your health fund fully covers the service, there can still be out-of-pocket expenses. Private hospital insurance generally covers 25% of the Medicare Benefits Schedule (MBS) fee, while Medicare covers the remaining 75%.
However, it's worth noting that medical professionals in the private system are not obliged to follow the MBS fee. If they charge more, you may have to pay the difference unless you have no gap cover.
What if You Need Treatment That’s Restricted By Your Insurer?
If you need treatment that’s restricted by your insurer, it may be worth asking your doctor to write a special appeal letter, including supporting documentation that explains the necessity of the treatment.
If that fails, you may need to start shopping around for another health fund provider that covers the treatment you need. However, be aware that waiting periods may apply.
Or, you can consider seeking a healthcare provider or clinic outside your insurer's network, although you may have to pay for any out-of-pocket expenses in these cases.
It's worth noting that many practitioners offer sliding fee scales or financing options to make necessary treatments more accessible. Don't hesitate to explore these alternatives to ensure you receive the care you need.
What are some examples of restricted treatments?
Restricted treatments are commonly seen in health insurance plans, and they may vary depending on the specific plan. Examples of restricted treatments include fertility treatments, mental health services like psychiatry and psychology, as well as alternative therapies such as acupuncture, chiropractic care, and lifestyle management programs.
Why do insurance companies restrict treatments?
Insurance companies impose restrictions on treatments for several reasons. The primary goal is to manage healthcare costs and ensure that customers receive coverage only for treatments included in their plan. By doing so, insurance companies aim to mitigate financial risks associated with extensive medical bills while still providing adequate care to patients.
How can I determine if my insurance company restricts treatments?
To find out if your insurance company restricts specific treatments, the most efficient way is to refer to your plan's online documents and review the list of covered medical services. Many insurance websites provide a search bar where you can enter the treatment or procedure you're interested in and see if it's covered. Alternatively, you can contact the company's customer service and inquire directly about coverage for specific treatments. It's always a good idea to cross-reference with other documents or representatives to ensure your preferred treatments are covered when needed.
What is the MBS?
The Medicare Benefits Schedule sets the standard for medical costs and rebates.
How do restricted treatments work with extras cover?
When it comes to extras cover, which typically focuses on ancillary services like dental, optical, or physiotherapy, restricted treatments may have limitations or exclusions. This means that certain treatments or services considered restricted by your health insurance may not be covered under your extras cover. It's important to carefully review the details of your extras cover policy to understand what treatments are included and whether any restrictions apply. If a treatment you need is classified as restricted, it's possible that you may need to pay for it out of pocket or seek alternative coverage options if available. It's advisable to reach out to your insurance provider directly to discuss any questions or concerns regarding restricted treatments and how they align with your extras cover.