Private Health..Yay or Nay

Hey All,
Starting a new topic specifically to discuss the pros and cons of having private health.

Here is what I understand in terms of the the rules around PHI.

MLS - If as a single you earn over 90k or a family over 180k and don’t have private health you are slugged with the MLS. When this occurs, the cost of having private health is negligible so in most cases your simply better of having it.

Rebate - The government provides a rebate which is almost always included in your premium.

LHC - The LHC gets applied at 2% for every year over the age of 31 that you do not have PHI. The loading lasts for 10 years when you take out a policy and is capped at 70% (so getting PHI when your 66).
As an example of the above my current policy is $275 per month. If I got this policy when I was 41 and never had previous cover it would be $275 + 20% = $330

 

For me personally I have had private health for nearing 10 years now. I have never used hospital cover and have claimed back in extras Maybe $500.

My wife however has been ill for a number of years. Unfortunately until recently it was undiagnosed (she has endometriosis). To get to this diagnosis she has gone into private hospitals many times. She has also maxed most of the extras every year in services trying to manage the pain.

My wife recently changed jobs to help manage all this but took a fairly big pay cut which would now put us under MLS.

For me personally I am thinking of getting rid of it for myself and saving $1,500 a year which I’ll bang straight into the mortgage and let the wonder of compounding do it’s thing. I’ll then take out ambulance cover.

The only negatives I can see is if something happens then I’ll need to either wait to be seen in the public system which I know in some cases can take 12+ months OR just pay for private without cover.
With the latter if I don’t take out cover and I injure myself in 10 years then I’m looking at a saving of let’s say on average $1,500 a year so $15,000. This would then reduce my interest payable on the home loan further compounding the saving.

If I could not wait for surgery then chances are I would still be up in paying private without cover than the cost of 10 years of insurance + the out of pocket expenses.

The other consideration is I do have income protection (within super) so if I did injure myself and couldn’t work whilst I wait ages to get seen in the public system I would have this cover in place.

 

I personally don’t think PHI is worth the cost unless you are saving on MLS as you have mentioned.

Even if you are covered by PHI there is a likelihood you will be significantly out of pocket when you head into a private hospital. The gap costs can be large enough to force even people with PHI to wait for public hospital spot.

APRA has great PHI statistics. See link here. And if anything enrollements have been falling every year. PHI in current way, is not sustainable IMHO.

 

For emergencies, you will be OK. It’s only elective, non life threatening operations you may have to wait for - however you may end up in a lot of pain while you wait.

You can get cheaper insurance. My Australian Unity Smart Start costs about $110 a month and has a $100 excess. I’ve used it for a few day procedures. But mostly it’s just to remove the Medicare surcharge.

However, unless it’s day surgery, I’m not covered unless I go into a public hospital as a private patient. I get $25 back on visits to physio and two free dental checkups (x-ray, clean etc) a year at the Australian Unity dental Centres and a discount on fillings etc - plus $150 for glasses a year.

Did some comparisons the other day and My Own insurance costs between $111 and $116 a month (depending if remedial massage is included) and gives $65% back for physio, massage, dental etc, But would have a gap for dental checkups and the excess is $500 - though only payable once a year.

I also got a quote for the next level up HCF $130 a month which includes private hospital cover but is very basic.

I ended up staying with Smart Start.

 

I had Phi until last year when my my wife ask me why, it had been a while since I looked at it and as we're married Medicare surcharge was nolonger and issue; we put money for Phi into an offset and use the public system; it's need based, so yeah you might have to wait to be seen but for children I wouldn't dream of anything else.

 

We're getting towards the pointy end of life - both hubby and I have dodgy knees - so will opt to stay in PHI, although I'm going to do a reassessment of our policy today and perhaps drop a level.

Although it does cost, there have been times in the past when we could've been in fairly dire circumstances if we didn't have it:

- Two years back hubby needed a double hernia op. Public wait was nearly a year. Private was straight in. Risk with waiting was, having a physical job, he could've torn and ended up with a real internal mess

- Eight years back hubby had a dodgy bowel test. Public wait to be seen by a specialist was over 12 months (ie, in 12 months we'll let you know when your appointment was). Private he was in within 3 weeks and diagnosed with pre-cancer growths, which were promptly removed. If waiting 12 months+ they could've turned cancerous and been much more serious.

- Hubby's aunt was in extreme pain requiring both hip and knee replacement - she had to wait two agonising years but was only allowed one surgery (chose hip or knee) before being put back to the end of the waiting list for the other

- Friend was recently diagnosed with breast cancer and being private was acted on immediately. After going thru extensive testing, she was operated on promptly and is currently undergoing chemo. Fortunately it hasn't spread past the lymph nodes. If she'd been public, and put on a waiting list, there was a good chance the cancer would've progressed further into her body.

I believe, if you can afford it, then it is worth every cent. Sure, for a broken leg or appendicitis, you get into hospital straight away - and all well and good if nothing "unexpected" happens - but there are so many significant health issues that you would have to wait. Is it worth the stress and pain to save a few dollars?

 

We have maintained private health since our late twenties. We're in MLS territory now so don't plan to stop. We've used the hospital cover maybe 7 or 8 times in 20 years including a couple of private hospital child births (one of which included the last 2 nights in a hotel) and some related visits.

We claim pretty regularly on extras too. Dentist for all 4 of us, a few episodes of major dental, and braces for our daughter. Glasses for 2 of us, regular chiro, some physio and psych at various times. Mouthguards for my son's footy, a couple of ambulance trips. Previously used it for discount Hoyts tickets too but a change of fund means I'm using RACV for that now.

 

The biggest issue with health care is the demand is infinite but the available resources are not.

 

^ ^ this!

 

My wife saw Doctor and she said - I think you have apendicitis. We were sent to the public hospital as its an emergency issue. They fart around for three days even as a private patient ina public hosital (they dont care about collecting any excess !!) . Terrible. But while scanning etc they see something on her kidney. Cancer. A luck break on her part. Most people find out too late. Two weeks later she meets the specialist (One of the top in the world) who gives her the choices :

1. Private patient. Laproscopic + robotic with a hefty gap of $20K. Can be done in 2 days. recovery will be fast. Kidney can be retained (99% sure). Scars will be small nicks. 100% recovery. Kidney will regrow. No chemo etc. Off work 2 weeks. 3 days is hospital.
2. Public patient. A massive cut from chest to centre of her back. 100% of the kidney is removed. The medicare scheduled fee isnt even $100 so what do you get for $100 ??? . No chemo. Off work 8 weeks + two weeks in westmead hosiptal maybe No choice of surgeon. If other kidney fails later etc she is in trouble and transplant is the sole solution. Risk of dialysis if the remaining kidney function struggles. eg No alcohol for life etc.
3. Oh...And the wait list for the public list is long. You may die from cancer before its scheduled.

The $20K was a great investment

 

You don't need it until you do. Then you'll be crying a river wishing you had it.

No point building wealth and stinging on Health Insurance.

 

When was this?

I ask because I’m pretty sure public hospitals have the capacity to do laparoscopic surgeries - not just private.

Or maybe Victoria’s ahead of NSW?

 

Thankfully for the past 3yrs we haven't had to use our PHI hospital cover but prior 3 years we claimed almost $150k with no or minimal out of pocket on some serious operations. There is a likelihood of future issues so we'll be staying in.

For extras/ancillaries we use orthodontics, dental, optometry, apnea CPAP device and remedial massage.

 

I've always had PHI (since adulthood), and always will. I just believe that the risks of NOT having it far outweigh the costs involved.

 

Budget reply had lots of spend in health. Good to see.

 

Yes, but the options available ate different.

I've broken a leg on a remote site in Victoria. The options were: regional Victorian base hospital or private in Sydney or Melbourne. Regional would have seen it set in plaster and a long a long slow recovery. Private saw me under the knife, a nail to stabilise the bones and a couple of screws. A week later, back at work.

For my next break I went public - 8 hours in emergency, to be told that I'd broken a bone, book into the bone clinic for next week and take a number. Getting a plate wasn't on offer. So I endured the weeks of pain & drugs until the bones knit. Then spent countless hours in physio.

Both outcomes were fine but I know which I prefer.

 

Like all insurances, you don't need them until you do! We have had PHI since we were 18 yo's , not going to stop insuring now we are 60 something year olds

 

WOW overwhelming response to keep!
I genuinely thought it would have gone the other way so your comments have definitely swayed my thinking.

I understand the point of insurance is to never actually want to use it. Just most other insurances you are required to have or have them because you don’t trust other people (e.g car insurance).

I am what I would consider a very healthy person, touch wood haven’t been a doctor in about 7 years and refuse to take any pain medicines.
Work a white collar job and don’t play sport anymore, just weights at the gym and running.

I guess the argument is you just don’t know what’s ahead and health is the one thing you don’t mess with.

Perhaps I’ll just need to review my level of cover.

 

4 years ago. Laproscopic and robotic partial kidney nephrectomy is not available in public hospitals. They cut you open like a shark and dissect it. The wonderful world of medicare pays a small amount so there is no budget for time, resources or multi million dollar gear for anything better. Medicare cant afford a specialist who can earn $1200 for a three hour operation with an assistant in tow.

Item 36527 | Medicare Benefits Schedule or
Item 36526 | Medicare Benefits Schedule

 

I have top PHI as part of my employment package - glad I do!

Wife did a knee in almost the same time as one of here mates who doesn't have PHI, almost identical injuries.

We saw specialist who said "what are you doing next Thursday ?"

Knee done by the Professor who teaches the others how to do it !

Wife's mate got an appointment to see a specialist 3 months later and the surgery a year after that !