The new Gold/Silver/Bronze/Basic tiered model for private health kicks in on April 1, signalling one of the biggest changes to hospital policies in more than a decade. While the tiered system is intended to make it easier for customers to compare policies in the long run, policy holders may notice significant changes to what’s covered under their plan.
Services and treatments once covered by some policies will be bumped to policies that cost more, while some customers will notice their existing policy now includes services that weren’t previously offered. In addition to the tiered system and premiums rising by an average of 3.25 per cent, policy holders should also be aware that there have been changes to the way natural therapies are covered by private health insurance and extras policies.
“A lot of Boomers might do yoga or Pilates or Tai Chi. Previously you could get a rebate under your extras policy. That’s no longer going to be the case,” Laura Crowden, Corporate Affairs Manager at iSelect, tells Starts at 60. “The government’s decided they’re not going to help fund those anymore.”
Alexander technique, aromatherapy, Bowen therapy, Buteyko, Feldenkrais, Western herbalism, homeopathy, iridology, kinesiology, naturopathy, Pilates, reflexology, Rolfing, shiatsu, Tai Chi and yoga will no longer be available on any private health policies. Having said that, remedial massage, Chinese medicine, myotherapy and acupuncture will still be included within extras policies, while Pilates provided by a registered physiotherapist may still be claimable under a policy holder’s physiotherapy limits.
As outlined by the Department of Health, rules have been made to exclude most natural therapies from the definition of general treatment under section 121-10 of the Private Health Insurance Act 2007. This means insurers will no longer be able to offer benefits for these therapies as part of a complying health insurance policy.
“Customers are of course free to continue using any natural therapy they wish,” Crowden says. “However, the full cost of the service will need to be covered by the customers, and they’ll no longer receive full or partial rebates from their private health insurance extras cover.”
The Department of Health made the decision to scrap these treatments after a review chaired by the former Commonwealth Chief Medical Officer Chris Baggoley found there was no clear evidence demonstrating the efficacy of the excluded natural therapies.
Undertaken by the National Health and Medical Research Council (NHMRC), the review analysed the effectiveness, safety and cost of 17 natural therapies and found that changing coverage for the excluded natural therapies would ensure taxpayer funds were spent appropriately instead of supporting therapies without demonstrated evidence of clinical efficacy.
In addition to the changes to natural therapies, it’s an important for older people to know exactly what they’re covered for and to ensure they’re on the right policy. Most over-60s should be looking at Gold or Silver policies.
“Any health need will still be covered, it may just be some are moving to a Gold policy,” Crowden explains. “Previously some silver policies would have covered cataracts. Now in order to get that, you’ll generally have to go to a Gold.”
All Silver policies will include treatment for the heart and vascular system, lung and chest, blood, back, neck, and spine, plastic and reconstructive surgery (medically necessary), dental surgery, podiatric surgery (provided by an accredited podiatric surgeon) and implantation of hearing devices.
Gold policies include all treatments covered by the Silver policy in addition to treatment for cataracts, joint replacement, dialysis for chronic kidney failure, weight loss surgery, insulin pumps, pain management with device and sleep studies.
Both Gold and Silver also include all the benefits of the Bronze and Basic policies, which cover rehabilitation, hospital psychiatric services, palliative care, as well as treatments for the brain and nervous system, eyes (excluding cataracts), the digestive system, pain management, skin and pain management, just to name a few.
“You might find all the things that are absolute must-haves for you are covered under a Silver, whereas if you do want to make sure you have something like cataracts covered, then that is going to push you up to Gold,” Crowden says. “It can be worthwhile talking through that with a health insurance expert and they’ll help you understand whether your health needs sit within the Silver or Gold and obviously there’s a price difference there.”
It’s also important to know that customers are never locked in to a policy and it’s not hard to change. Despite this, there’s a myth that changing policies is difficult or complicated, resulting in many over-60s remaining on policies that cover irrelevant health needs such as pregnancy.
“Our key advice is when your life stage changes, your health needs change, your life stage might be entering retirement or your health needs might be that you had a medical situation, they should be your triggers to reassess private health insurance and make sure you’re still on the right deal,” Crowden says. “You’re not locked in to any. If you decide to change in April or November next year, you can change at any point.”
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