It's no secret that health can be unpredictable, but the good news is that your access to care doesn’t have to be. That’s where private health insurance steps in.
In Australia, private health insurance gives you more choice, flexibility, and control over your healthcare. It can give you the opportunity to avoid long public hospital wait times, choose your own specialists, and access services that aren’t fully covered by Medicare, like dental, optical, physio, and some mental health support.
But it’s not just about extras. Many people take out private cover to feel more secure, speed up treatment, and take advantage of government incentives like the private health insurance rebate.
Whether you're exploring options for the first time or rethinking your current cover, understanding how private health insurance works, and what it can actually do for you, makes all the difference. We're cutting through the fine print to help you make the right call for your needs and budget.
What is private health insurance in Australia?
Private health insurance in Australia is an optional way to access healthcare alongside the public system. While Medicare covers many essential services, private cover gives you extra options - like choosing your doctor, getting treated in a private hospital, or claiming benefits for services Medicare doesn’t fully cover.
The system is made up of two main types of cover: hospital and extras. Hospital cover helps with the cost of treatment as a private patient in either a public or private hospital. Extras cover, sometimes called ancillary cover, helps with services like dental, physio, optical, and some mental health support.
The key difference is choice and access. Medicare gives you access to free or low-cost treatment in public hospitals but doesn’t let you choose your doctor or guarantee shorter wait times. Private health insurance can give you more control over where, when, and how you’re treated.
Types of private health insurance cover
There are three main types of private health insurance cover in Australia: hospital, extras, and combined. Each one serves a different purpose, depending on your health needs, budget, and stage of life.
Hospital cover
Hospital cover helps pay for treatment as a private patient in a public or private hospital. It can cover theatre fees, accommodation, and doctor or surgeon fees. This type of cover is helpful if you want to avoid public hospital waitlists,
choose your own doctor, or access a private room. It’s especially worth considering if you’re planning a surgery, starting a family, or managing ongoing health conditions.
Extras cover
Extras cover is for everyday health services that Medicare doesn’t usually pay for. Think dental check-ups, physio appointments, optical, chiro, and sometimes even remedial massage or psychology. Each policy offers different levels of cover, so it’s worth checking what’s included and how much you can claim back.
Combined cover
Combined cover is exactly what it sounds like: a package that includes both hospital and extras cover. It’s a convenient option if you want broader protection without managing two separate products. Bundling can also help you save money, depending on the fund and level of cover you choose.
How private health insurance works in Australia
Private health insurance isn’t one-size-fits-all. Choosing the right policy starts with understanding your health needs, lifestyle, and budget. If you’re young and healthy, you might only want basic hospital cover or a simple extras plan that covers dental and physio. If you have a family, you might prefer more comprehensive cover that includes pregnancy, kids’ dental, or orthodontics. Older Australians might look for policies that support joint replacements, heart procedures, or chronic condition management.
Waiting periods
When you take out a new policy or upgrade your cover, waiting periods can apply. This means you’ll need to wait a certain amount of time before you can claim on specific treatments, commonly 2 months for most hospital services and 12 months for pre-existing conditions or pregnancy-related care. Extras policies also have waiting periods, often ranging from 2 to 12 months depending on the service.
Rebates, excess, and co-payments
Most Australians are eligible for a government rebate to help with the cost of premiums. The amount depends on your income and age, and it can be applied as a discount on your payments or claimed at tax time. A helpful resource to work out how much you could be eligible for can be found here.
Excess and co-payments are costs you might need to pay if you go to hospital. The excess is a set amount you agree to pay upfront per admission or per year. Co-payments are smaller daily charges you may need to pay depending on your fund and level of cover. Always check your policy to understand what’s included—and what’s not.
Why get private health insurance?
One of the main reasons people choose private health insurance is control, over your healthcare, your timeline, and your provider. With hospital cover, you can be treated in a private hospital and often choose your own doctor. You’re not limited to the public system, which means you can avoid long wait times for many elective procedures like knee surgery, cataracts, or gallbladder removal. Plus, with HIF’s Access Gap Cover initiative, eligible members may be able to reduce or eliminate out-of-pocket costs when seeing a specialist in a private hospital, making private healthcare more affordable.
Private health cover also helps with out-of-hospital services that Medicare doesn’t fully fund. Extras cover can reduce the cost of regular check-ups like dental, physio, optical, and more. However, coverage for these services depends on the level of cover you choose. These services might seem minor day to day, but they add up fast—and a good extras policy can make a real difference to your overall health and budget.
For many, it’s about peace of mind. Knowing you’ve got more options and faster access to care when you need it takes the pressure off, especially when life throws a curveball.
Government incentives and potential savings
The Australian Government offers a few incentives to encourage people to take out private health insurance, and understanding them can help you save money now and in the long run.
Private Health Insurance Rebate
If you have an eligible private health insurance policy, you may qualify for a rebate to help cover the cost of your premiums. The rebate is calculated based on your income and age. You can claim it as a reduced premium through your health fund or as a tax offset when you lodge your return.
Medicare Levy Surcharge
If your income exceeds certain thresholds and you don’t have hospital cover, you may need to pay the Medicare Levy Surcharge. This additional tax, which can be up to 1.5% on top of the standard Medicare levy, can be avoided by taking out an eligible hospital policy. For detailed information on income thresholds and how the surcharge applies, please visit this link.
Lifetime Health Cover loading
If you don’t take out hospital cover by 1 July following your 31st birthday, you may end up paying more later due to the Lifetime Health Cover (LHC) loading. This loading adds 2% to your premium for every year you delay, up to a maximum of 70%. Once it applies, the loading remains in place for 10 years. Taking out cover earlier can help you save significantly in the long run. Some exceptions do apply—such as time spent overseas or your residency start date. Visit the Lifetime Health Cover page to see how LHC loading may affect you.
How to claim and make the most of your cover
Making a claim with HIF is simple, and getting the most out of your policy comes down to knowing what’s included and how to use it.
To submit a claim with HIF, you can use the HIF Member App, claim online via the member centre, or swipe your membership card on the spot at your provider if they offer HICAPS. Some providers can even lodge the claim for you electronically, which means less paperwork and faster reimbursements.
Your cover isn’t just for major procedures - it can support your everyday health. Use your extras cover for regular check-ups, physio appointments, dental cleans, new glasses, or even remedial massage if your policy allows. Keeping on top of routine care can help prevent bigger health issues down the track.
Common mistakes people make include not checking their remaining annual limits, letting unused benefits expire at the end of the year, or forgetting to serve waiting periods. Always check your policy details, compare providers if needed, and reach out to HIF if you’re unsure what you’re covered for—a quick question could save you hundreds.
To make things easier, HIF members have 24/7 access to their cover details through the Online Member Centre (OMC). You can check what’s included on your policy, view your annual limits and claim history, update your membership details, and more. Learn more at hif.com.au/members or log in anytime at member.hif.com.au.
Here's more info on how to submit a claim with HIF.
FAQs about private health insurance
Here's a look at some of the most frequently asked questions about the benefits of private health insurance.
Is it worth paying private health insurance?
For many Australians, yes - especially if you want more control over your healthcare. Private health insurance can help you avoid long wait times, choose your own doctor, and access services Medicare doesn’t cover, like dental or physio. Depending on your income, it can also reduce your tax through the Medicare Levy Surcharge and give you access to the private health insurance rebate. With options like HIF, you can tailor your cover to suit your lifestyle and budget.
What happens if you don't have private health insurance after 30?
If you don’t take out hospital cover by 1 July after your 31st birthday, you may have to pay the Lifetime Health Cover (LHC) loading. This adds 2% to your premium for every year you delay, up to a maximum of 70%. The loading lasts for 10 years. Taking out cover earlier through a fund like HIF can help you avoid this extra cost and give you peace of mind sooner. For more comprehensive information please visit the following resource
Which private healthcare is best?
The best private health insurance is the one that fits your needs, lifestyle, and budget. It depends on what you want covered - hospital, extras, or both. Some people want top-level hospital cover, while others are after extras like dental and optical. HIF offers flexible options with no lock-in contracts, so you can adjust your cover as your needs change. Always compare based on benefits, limits, and out-of-pocket costs, not just premiums.
Key Takeaways on Private Health Cover
Whether you want to skip public hospital waitlists, access specific services, or simply take better care of your health with extras like dental and physio, the right private health insurance policy can make a big difference.
If you’re looking for flexible cover without the fluff, HIF offers policies that are easy to understand and built to suit your stage of life.