How long can I stay on my parents’ policy?
For most health funds, at the age of 18 or 21, you will automatically be taken off your parents’ policy. After that, you are expected to get your own health fund or rely on Medicare.
You may be able extend your stay on your parents’ health insurance until you are 25 if you meet certain criteria. First, you cannot be married or in a de facto relationship. If you are in post-graduate programs and thus can be classified as a ‘student dependant’, you can get back your parents’ insurance. If you don’t meet any of the criteria, your parents can keep you on their plan in exchange for higher premiums.
What are my other options?
Medicare is free but it offers limited coverage (no extras) and one emergency can stick you with a large bill of out-of-pocket costs. Getting on your own health insurance policy is the recommended path.
In order to encourage young adults to sign up for private health insurance earlier in life, the government offers a carrot (incentive) and a stick (penalty). The ‘carrot’ is the age-based discount of up to 10% on premiums for people aged 18-29 years. The government started allowing insurers to offer this discount in April 2019. This benefit could last until the age of 41. So more financially suitable options might be available to you as a new member of the workforce. The ‘stick’ is the Lifetime Health Cover (LHC) which charges 2% loading on the premium for every year you are over 30. It’s a punitive charge for not having your own health fund earlier in life and lasts for 10 years until you request for removal.
So signing up for your own health fund as a new adult is sensible if you find the right provider. Staying on medicare could limit the treatment services covered or the speed of access to urgent services, potentially increasing your subsequent out-of-pocket costs. You can use our website to start exploring your options!