Private Health Insurance Reforms FAQs

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Government reforms

What are the new hospital categories?

The government’s Private Health Insurance reforms mean that all hospital covers in Australia must be categorised as either Basic, Bronze, Silver or Gold by 1 April 2020.

The idea behind the change is to make it easier for you to understand and compare covers between all health funds.

Peoplecare is moving all hospital products into the government’s new categories by 1 April 2019.

What do Basic, Bronze, Silver and Gold mean?

All hospital covers in Australia must list what hospital services they cover across 38 clinical categories. You can see the minimum requirements of a Basic, Bronze, Silver and Gold hospital cover across these 38 clinical categories in the table below.

The changes will result in standardisation of hospital covers and will give Peoplecare members the confidence in knowing how their choices stack up against the rest.

Private health insurance reforms: Gold/Silver/Bronze/Basic product tiers (PDF) on health.gov.au.

Is Peoplecare offering the youth discount?

One of the optional government reforms is that health funds can offer age-based discounts from 1 April 2019 for 18-29 year olds. 

Peoplecare doesn’t have any plans to offer a youth discount right now. We think it’s a bit complicated and it isn’t clear yet if the benefit of having more young people join Peoplecare outweighs the discount itself along with the clunky admin cost of it. And the value of our current covers speaks for itself, even without discounts. We’ll make sure to let you know if we decide to have any age-based discounts in the future.

Which natural therapies are no longer covered?

The new government rules mean that most natural therapies can no longer be covered on private health insurance from 1 April 2019.

This is the full list of natural therapies to be taken out of private health insurance by the government: Alexander technique, aromatherapy, Bowen therapy, Buteyko, Feldenkrais, Western herbalism, homoeopathy, iridology, kinesiology, naturopathy, Pilates, reflexology, Rolfing, shiatsu, tai chi, and yoga.

For Peoplecare members, we’ll be making these changes to the natural therapies benefits in our extras covers from 1 April 2019:

Natural therapy consultations, Western herbalism, homeopathy, Pilates and yoga. 

Peoplecare still pays benefits for remedial massage, acupuncture and Chinese herbal consults available on some of our extras covers.

What are the new travel benefits for rural members?

Health funds can now offer travel and accommodation benefits on hospital cover now. These benefits are most useful to rural Australians who need to travel long distances for hospital services.

Peoplecare already offers travel and accommodation benefits on a broad range of extras covers, so we won’t be offering this on any hospital covers.

What are the new excess options?

From 1 April 2019, health funds are able to raise the highest excess available from $500 to $750. Peoplecare will offer the $750 excess option on some hospital products so members can reduce their ongoing premiums. We’ll let you know details early in the new year.

How do the government’s Mental Health Reforms work?

The once-in-a-lifetime psychiatric services wait exemption has been available from all health funds as part of the new government rules. From 1 April 2018, a health fund member with hospital cover could upgrade to a cover with psychiatric services without having to serve the usual 2-month waiting period for psych hospital admissions.

If you use the once-in-a-lifetime upgrade and want to drop or downgrade your hospital cover in the future, and need to claim psychiatric services again, the full 2-month wait will apply for upgrading your cover. This rule applies whether you stay with Peoplecare or transfer to another fund.

 As usual, all membership payments need to be up-to-date for any psych admission to be funded by a health fund.

What are the changes to Private Health Insurance information?

There are two small changes in health insurance information.

  1. A re-design of the Private Health Insurance Ombudsman comparison website privatehealth.gov.au.
  2. An easier to read Private Health Information Statement (PHIS) replaces the current Standard Information Statement available. You can request your PHIS from 1 April 2019 from your health fund or via privatehealth.gov.au.
What new powers does the Ombudsman have?

Health fund members have the right to take complaints about their health fund cover and service to the Private Health Insurance Ombudsman (PHIO, sometimes also called the Commonwealth Ombudsman). 

The two new measures for the PHIO are:

  1. Audit and inspection powers to address consumer complaints; and
  2. More staff at the Ombudsman who’ll investigate complaints for consumers
What are the prostheses reductions?

Prostheses are any physical items that are inserted into the body during surgical procedures. There are commonly known ones like screws for broken bones and artificial hip and knee joint replacements. But there are a heap more, such as stents (tubes that keep blood vessels and other body passageways open), heart valves and pacemakers.

A key problem according to the private health insurance industry is that we pay more for prosthesis than public hospitals do. 

The government has responded by passing through staged reductions in prosthesis costs from 1 February 2018 to 1 February 2020. The government estimates these changes will save around $200 million a year. Health funds, in turn, have agreed to pass on any savings to members.

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