What should you look for in a health policy if you are over 65?

  • November 03, 2020 06:04 PM AEDT
  • Edita Ivancevic
    Journalist Edita Ivancevic
    212 Posts

    Edita is a young journalist who graduated in 2019 from the Faculty of Political Science in Zagreb, Croatia, specialising in Television and Public Relations. Since the teenage years, Edita gained knowledge of news reporting and analysing complex curre...

What should you look for in a health policy if you are over 65?


  • The older generation has a lot on its mind when on the verge of retirement – private health insurance being in the list’s top five.
  • Seniors are advised to take out insurance packages that offer more extras within the policy, as people aged 65 and over make 40 per cent of all hospitalisations in Australia.
  • Private insurance expenses depend on several factors, primarily location and the number of extras taken.
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Retirement should be a comfortable phase of life for senior citizens where all critical aspects have been handled in advance. Paying off one’s debt, making safe investments, and having an adequate superannuation provider are only some of the things Australians must take care of before leaving the workforce.

To have a safe and sound retirement, many Australians consider a private healthcare insurance policy. Private insurance in Australia may be of significant relevancy, as it offers many benefits compared to Medicare, such as choosing a particular specialist or a hospital, and many others.

MUST READ: 6 Important checklist items to consider while buying health insurance plans

As the Australian government introduced the Lifetime Health Cover initiative to push more youngsters towards private healthcare, more people have joined the privatised healthcare. However, people still need to change their private insurance policies over time.

When people hit a certain age, they should consider upgrading existing policies for extra medical treatments that are not covered by Medicare. This is because seniors are prone to specific conditions like heart diseases.

GOOD READ: How does age impact the cost of health insurance plans?

What can seniors choose from?

Every private insurer offers four layers of insurance - Basic, Bronze, Silver, and Gold scheme. Starting from the Basic plan, there is barely any additional coverage for hospital services. As policies progress, they get more medical departments included, but also get more expensive.

On most occasions, private insurers will also offer a Plus option for any on the above schemes. For example, in a Silver Plus alternative, patients would get some of the Gold advantages while not paying for the Gold policy (e.g. pregnancy assistance and treatments).

Image Source: © Kalkine Group 2020

Image Source: © Kalkine Group 2020

DID YOU READ: What factors can impact your health insurance premiums?

More than 40 per cent of the hospitalised patients overall are aged 65 and over, which means that having the right insurance policy might save some big bucks. As a comparison, this older generation makes only 15 per cent of the entire Australian population.

Other hospital services that are characteristic for seniors are heart surgery, dialysis, palliative (secondary) treatments, joint replacements, cataracts, and rehabilitation. All these amenities are covered mostly under the Gold package, with some exclusions to Silver and Silver Plus. It is advised to do some research before signing up for the cheaper policy, as its conditions might state that it does not cover for a particular illness or disease.

The last thing seniors should be careful of are waiting periods. Waiting periods apply at the start of every renewal or joining to private healthcare. Therefore seniors should schedule their appointments at the doctor’s once their waiting periods are over. In case they forget about the waiting period rule, seniors will face big out-of-pocket bills.

RELATED: What do we mean by waiting period for private health insurance?

What are the average expenses for senior health insurance?

No matter at what age one decides to take out private insurance, the policy will vary depending on extras (ambulance and in-hospital cover, dental, vision, and others). The same thing applies to senior health insurance – costs are higher with more extras taken.

However, special senior policies are mostly cheaper than family or couple packages. For example, most elders give up on pregnancy and obstetrician services once they get older. Different Australian states also have various costs for senior singles and couples.

According to some estimates, the average annual health insurance premium for mature singles (hospital and extras cover) ranges between A$2,300 and A$2,800. For mature couples, the premium is in the range A$4,600 – A$5,500.

It is worth mentioning that the average costs exclude overseas students (OSHC), visitors (OVHC), and corporate covers.

DO READ: Overseas Student Health Cover (OSHC): Why is it mandatory?

Are there some options for lowering the premiums?

There is one popular strategy that Australians use for lowering insurance premiums – signing up for higher excess bills. Excess is the amount one pays when being admitted to a hospital. Patients need to pay for one or two excess costs within a year (in case they go to a hospital).

In 2019, the highest amount for excess one could ask for was A$500. As of 2020, that amount has increased and is at A$750 for singles and A$1,500 for couples. If one chooses higher excess, one will have to pay lower premiums long-term.

However, seniors that know for sure about their future surgeries (in the next two years) are advised not to take this option. As persons might need to stay in the hospital for an extended period, there is a lower risk of paying substantial out-of-cost expenses with higher premiums.

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Why should seniors consider having private insurance?

Even though the Australian healthcare system is ranked 9th best in the world, there are a lot of benefits that are not covered by the public system.

Most people will inevitably develop some form of illness as the time passes. Hence, it is better to be prepared with extra advantages that insurers provide.

Heart surgeries are the most common medical treatment for people aged 65 years and above, but Medicare does not cover them. Also, other surgeries that would enhance the overall quality of quality are covered by Gold packages only.

However, the most significant element is no long queues. Waiting in lines for surgery might be critical for senior citizens; therefore, it is always recommended to be over with them as soon as possible. With public healthcare, queues can take up to six months.

All things considered, there is no harm in having a sense of comfort when it comes to health, especially if money is not a problem.  

MUST READ: What are the different types of health insurance available in Australia?



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