Best Health Insurance Australia FAQs

Its critical to find the best health insurance policy not only to ensure you get the best value but also to ensure you have sufficient cover for your circumstances.

The article below focuses on breaking down the elements which will determine what type of health insurance you are either required to have or can purchase voluntarily.

It also goes through legislation including tax penalties that you may receive if you don't have the right level of Australian private health insurance.

1) What Is Your Australian Residency Status?

Not everyone in Australia is a permanent resident with many overseas migrants every year choosing to work, study or visit Australia.
There are individual health insurance policy groupings that meet the specific health cover Australian requirements set by the government

Permanent Residencea) Permanent Residents

Health Insurance for permanent residents is not compulsory but a majority of Australians choose to have health cover because:

– The Australian public health system is feeling the strain of an ageing population with lower service levels and long waiting periods

– Medicare does not cover all medical costs with most treatments resulting ‘out-of-pocket’ expenses which can be significant

– Health Insurance becomes more expensive every year that your not a member after you turn 31 years old (Lifetime Health Cover).

– You may be taxed up to an extra 1.5% due to the Medicare Levy Surcharge if you don’t have health insurance over the financial year.

The best health insurance Australia policy will have a ‘hospital cover‘ component. While extras cover only policies may seem appealing because you may make more frequent claims on health services such as seeing a dentist or physiotherapist, they don’t provide cover when you become sick or injured and need to visit a hospital or require services such as an x-ray. Only a hospital cover policy will also help you avoid elements such as the lifetime health cover loading and medicare levy surcharge.

Most Australians choose hospital + extras option which combines the element you will more commonly claim (extras) with the important hospital cover component.

b) Temporary Overseas Visa Workers

Migration has always been the backbone of Australia and still today thousands of overseas workers move to Australia on a temporary basis to work under schemes such as the subclass 457 visa. These working visa sub-classes have ‘condition 8501’ which requires them to have adequate health insurance both when applying for the visa and during their stay.

Overseas visitors cannot purchase the same health insurance policies that permanent residents are eligible. Rather they must must purchase a health insurance Australia policy that meets condition 8501 which only a handful of health funds offer.

Below shows an example of Australian 457 Visa Health Insurance Policies that meet condition 8501.
457 visa health insurance policy

There are also health insurance for 485 visa policies and more generally overseas visitor health insurance policies which can be compared by clicking on the links to the left.

When an individual comes from a country that has a reciprocal health care agreement with Australia they may apply for Medicare when they arrive in Australia. Once they receive their Medicare card they have met condition 8501 and have the option to cancel their health insurance Australia policy. That said, they may want to keep the policy due to the same reasons that permanent residents voluntarily to purchase health cover from avoiding the medicare surcharge to the level of care they receive if they are sick or injured.

c) International Students
Permanent Residents Health Insurance

Any overseas student who wishes to study in Australia must have overseas visitor health insurance (OSHC) when they apply and stay in Australia. This health insurance Australia policy is cheaper then the two policies above but has reduced cover compared to their counterparts. You can at a sister site.

It should be noted that there are many add-on products to OSHC policies for those looking to increase their cover during their stay within Australia. It is also worth knowing that its your choice which OSHC provider you go for so make sure you shop around before choosing the best policy for you.