About Private Health Cover

1. Why do I need private health cover?
2. Who are nib policies available to?
3. What is a hospital excess?
4. What is the Federal Government Rebate?
5. What is Lifetime Health Cover?
6. What is the Medicare Levy Surcharge?
7. What is the Pharmaceutical Benefits Scheme (PBS)?
8. What is the Medicare Benefits Schedule Fee and the 'gap'?
9. What is an agreement private hospital?
10. Why are there waiting periods, benefit limits and other rules of membership?
11. What are waiting periods?
12. How do I transfer from another fund?

1. Why do I need private health cover?

Private health cover gives you control of your health care. It allows you and your family to access the right health services at the right time, and to choose the doctor, hospital and timing of your treatment. With private health cover you have access to an extensive range of private hospitals and can rest assured that you are in good hands.

Private health cover also provides cover (called extras cover) for services not covered by Medicare such as dental, optical, physiotherapy, natural therapies, ambulance, plus many more.

The Federal Government Rebate on Private Health Insurance has made contributions even more affordable, and with the introduction of Lifetime Health Cover there is further incentive to take out health cover earlier in life and benefit from base rate contributions.

2. Who are nib policies available to?

nib policies are available to permanent Australian residents with a current green or blue Medicare Card. If you have a yellow Medicare Card you will not receive full hospital benefits from your nib health cover. Contact nib for more information.

3. What is a hospital excess?

An excess is the amount you elect to pay towards your hospital stay, before we pay a benefit. It's one of the things you can't claim back. Selecting an excess means your contributions are lower.

The excess is only payable if you, or someone on your membership, go to hospital - it does not apply to extras cover.

Depending on your health cover, you'll have to pay the excess each time you are admitted to hospital. But we "cap" it to a set amount per year. The amount varies depending on your health cover.

You should always check your cover's hospital excess before going to hospital.

4. What is the Federal Government Rebate?

The cost of maintaining your health needs is expensive. To help ease this cost, the Federal Government Rebate offers you a saving on the cost of your private health cover. You just have to be an Australian who is eligible for Medicare and have private health cover.

There are different levels of Rebate, depending on the age of the oldest person on your membership.

For example: If you are eligible for the 30% Rebate, this means that for every dollar you pay in contributions to NIB, the Government gives you 30 cents back.

There are three ways you can claim the Rebate:

1. Use it upfront to reduce the cost of your contributions
2. Claim it when you lodge your tax return
3. Get a cash or cheque payment from a Medicare office

Find out more

5. What is Lifetime Health Cover?

Lifetime Health Cover is a Government initiative that started on 1 July 2000. It recognises the length of time a person has private health cover and rewards that loyalty by offering lower contributions. A person who takes out hospital cover by 1 July following their 31st birthday, and maintains their cover, will be charged lower contributions throughout their life compared to someone who takes out hospital cover after 1 July following their 31st birthday. LHC does not apply to extras cover. All hospital covers offered by NIB meet the LHC requirements. Find out more.

6. What is the Medicare Levy Surcharge?

If your taxable income is above the Medicare Levy Surcharge thresholds, and you do not have an appropriate level of private hospital cover, you may have to pay the Medicare Levy Surcharge. This is an additional 1% in tax (on top of the Medicare Levy we all have to pay).

The good news is that you can avoid the Medicare Levy Surcharge (and pay less tax) by joining an nib health cover with a hospital excess of $500 or less for singles, and $1,000 or less for couples/families, per calendar year.

Note: if you took out hospital cover before 24 May 2000, you'll be exempt from the surcharge regardless of the nib excess you selected, as long as you remain on your current health cover and excess level.

If you suspend your policy for any period of time, you will not qualify for this tax break and the Medicare Levy Surcharge will apply.

Want to know more?

• Visit the Department of Health and Ageing website at health.gov.au
• Visit the Australian Taxation Office at ato.gov.au

If you're unsure whether your nib health cover meets Medicare Levy Surcharge requirements, please contact us.

7. What is the Pharmaceutical Benefits Scheme (PBS)?

Pharmaceutical Benefits Scheme is funded by the Commonwealth Government where patients make a contribution to the cost of a subsidised drug. Find out more.

8. What is the Medicare Benefits Schedule Fee and the 'gap'?

The Commonwealth Government has a schedule of fees for medical services. This is called the Medicare Benefits Schedule (MBS). Using the MBS Medicare pays 75% of the fee for a medical service provided in hospital to a privately insured patient and NIB covers the remaining 25% (provided the procedure is not excluded on your health cover). If Medicare does not pay a benefit an NIB benefit is not payable. The 'gap' occurs when doctors charge in excess of the MBS. The NIB MediGap scheme aims to eliminate these gap payments. Find out more.

9. What is an agreement private hospital?

An NIB agreement private hospital is one which NIB has negotiated charge agreements. Subject to your type of cover, this provides for in-patient accommodation fees including; bed fees, theatre and labour ward, intensive and coronary care.

Not all private hospitals have agreements with NIB and as such, there may be private hospitals in your area where you may incur out of pocket expenses.

To find out more or, to check if your private hospital participates in NIB's Agreement private Hospitals Scheme, please click here.

10. Why are there waiting periods, benefit limits and other rules of membership?

Rules of membership including waiting periods are necessary for the protection of current members and to provide fair access to benefits for all members. A number of fund rules are determined by government health legislation.

11. What are waiting periods?

The period of time you have to be an NIB member before you can make a claim. As with any health fund, there are waiting periods for new members and members upgrading from another cover for services that were previously unavailable. Please refer to the table below for our waiting periods.

As a transferring member, waiting periods are waived for all services which are covered by your current fund, providing you have already served the required NIB waiting period and NIB offers the same service. Benefits that are not available with your current fund, but are now available to you through NIB, will require the appropriate waiting period to be served. Where the NIB benefit is higher than paid by your current fund, the lower benefit will be paid until the appropriate NIB waiting period is served.

Note: your cover may exclude some of these procedures.

You should also check if a Restriction or Benefit Limitation Period applies to your cover.

* Please note that for members with closed products different waiting periods may apply. Please email or call 13 14 63 for more information.

12. How do I transfer from another fund?

If you are with another health fund, complete the Clearance Cancellation Certificate (PDF file). You will be given continuity of membership for services which were covered by your current fund as long as your chosen NIB cover includes these services and you have served the required waiting periods with your current fund. Where you have used part of or all of your annual benefits with your current fund, NIB will take into account the extent of benefits paid for the balance of the calendar year.