Why do I need private health insurance?
Australia’s public health system, Medicare, provides essential coverage for a range of health services like visits to GP’s, public hospital stays and some medications.
You might be wondering: “Why would I need private health insurance when I already have Medicare?” Put simply, Medicare doesn’t cover the cost of everything. That’s where private health insurance comes in; it aims to compliment Medicare by contributing to costs for private hospital care and selected everyday services (like dental or optical), depending on your specific healthcare needs.
Private health insurance can give you that extra layer of support when it comes to treatments, hospital stays and services that Medicare doesn’t pay for. It’s all about having more control over your healthcare. There’s no denying private health insurance can be expensive, but hospital costs as a private patient without the appropriate cover can be even more so. Without cover you could be paying out tens of thousands of dollars.
For overseas members, it's worth researching what private health insurance^ can do for you if you become an Australian permanent resident.
At nib, we consider ourselves your health partner – helping you stay at your healthiest and being there to guide you through the often-confusing health system when you need us. So, we’ve put together a health cover explainer to help you make the right decision for your current circumstances.
First up, what is private health insurance?
Private health insurance is something you can purchase from a registered health insurer like nib. There are different types of private health insurance, so you can choose the plan that fits your needs:
Hospital cover: This covers your hospital stays, surgeries and other medical treatments in private hospitals. It gives you the freedom to choose your doctor and your hospital (which can also help avoid long waiting times).
Extras cover: This covers things like dental check-ups, physiotherapy, optical and other everyday health services that aren’t covered by Medicare like remedial massage for example.
Combined Hospital and Extras cover: If you want both hospital and extras cover, you can choose a combined plan that offers comprehensive protection for your health.
Having private health insurance can offer you a lot more flexibility, faster access to treatments and the ability to choose your healthcare providers in the private system (depending on specialist and facility availability), giving you more choice and control over your health.
Why do I need private health insurance?
1. Cover for hospital costs
Combined with Medicare, if you’re an Australian resident, your hospital health insurance will help cover the costs associated with your treatment as a private patient.
If you need treatment in a private hospital, Hospital cover ensures you’re protected. Without private health insurance, the costs of things like surgeries, specialist consultations and hospital stays can add up quickly.
If your chosen level of cover includes your procedure and you attend one of the nib Agreement Hospitals (or any public hospital as a private patient) nib will pay benefits towards:
Hospital accommodation (i.e. your bed and a private room if there's one available)
Operating theatre fees
Intensive care fees
Labour ward fees
Meals
Common treatments and support treatments1
Associated treatment for complications and associated unplanned treatment2
If you’re an nib member, you should always check that your procedure is covered before going to hospital and contact us, so we can help you understand your cover and minimise any potential out-of-pocket expenses.
Related: Preparing for hospital: What is covered?
2. Save money on emergency ambulance trips
If you’re in an emergency situation with an ambulance on the way, you might be in for the most expensive ride of your life. And, if you’re one of the 30% of Australians who think Medicare will cover the cost, you’re in for a shock.
If you’re not covered by your State Government, most of our products offer emergency ambulance cover3 so if you sign up to nib, you’ll get the help you need, when and as often as you need it. Visit Ambulance cover to learn more.
Related: How much does it cost to call an emergency ambulance in my state?
3. Cover in emergencies
While public hospital healthcare (including emergency treatment) is free to all Australian citizens and most permanent residents, lengthy waiting times can apply if you need further treatment after your initial admission. Waiting for treatment has the potential to impact so many aspects of your life, including your ability to work, so avoiding public hospital waiting lists could save you time and money.
With nib’s Accidental Injury Benefit, you'll receive benefits related to the accident in line with our Gold Hospital cover within 90 days after an accident if you present for treatment with a medical practitioner or attend an emergency department within 72 hours of the accident and are admitted to hospital. This includes admission to a private hospital or as a private patient in a public hospital. It’s offered with every level of nib Hospital cover4.
Learn how to quickly and easily check what you're covered for in your member account or via the nib App.
4. Skip the public hospital waiting lists
Without the right cover, wait times for non-emergency treatment in the public system can be weeks or even months. And if you choose to go to a private hospital without the right cover, your treatment won’t come cheap.
Taking out Hospital cover can help you avoid the long waiting lists you might experience in a public hospital. Data released by the Australian Institute of Health and Welfare showed that in 2024-25, the proportion of patients waiting more than a year on the elective surgery wait list was 6.0%, with patients requiring a septoplasty (surgery to fix a damaged nose) waiting for a median of 320 days.
With the right level of nib Hospital cover, you choose when and where you get your surgery – meaning you can get back to work (and play) – sooner. Private hospitals also manage their own wait times, so the timing of your treatment will depend on the availability of your specialist and the hospital you choose.
5. Choose your healthcare specialist and where you're treated
By having private health insurance you may be able to choose your hospital and treating doctor. This gives you more choice and control, and peace of mind knowing you're being treated by a doctor who participates in your chosen hospital and is available. Search for a provider in our network using nib's Find a Provider tool.
6. Avoid the Medicare Levy Surcharge and save at tax time
If your taxable income is above $101,000 ($202,000 for families) and you don’t have an appropriate level of private health insurance, you may have to pay the Medicare Levy Surcharge. This is an additional 1% to 1.5% tax on top of the Medicare Levy we all have to pay5.
If eligible, you could avoid the Medicare Levy Surcharge – and pay less tax – by taking out eligible nib Hospital cover and maintaining it for the full financial year. If you take out Hospital cover part-way through the financial year, (if eligible) you may be able to avoid the surcharge for the period you held suitable Hospital cover.
7. Save money on everyday healthcare services
While Medicare covers some essential healthcare costs, it doesn’t help with things like dental check-ups, physiotherapy sessions, or glasses. With Extras cover, you can help cover the costs of these services, which can add up quickly. Private health insurance can reduce the amount you need to pay for these types of treatments, meaning lower out-of-pocket expenses for you.
At nib, we offer a range of Extras covers so you can choose one that’s right for you and your family. There are some core inclusions that we pay benefits for across most of our Extras policies:
Emergency ambulance3
Preventative dental
General dental
Major dental
Optical
Physiotherapy
We know that everyone is different when it comes to their health, so we also offer a range of Extras covers that can provide cover towards the cost of popular treatments like osteopathy, dietary advice and orthodontia. Find out more in our article What Extras benefits can I get with nib?
What we covered for our members in FY25#
The increasing cost of healthcare means more reasons to ensure you have Hospital cover with the right level of Extras. Here are some numbers highlighting how much nib covered for our members in FY25.
Funded almost 400,000 hospital admissions
$2.3 billion in claims paid for Australian residents
Highest individual claim paid of $259,929#
Over 89,000 members undertook a health assessment or used a screening program to better understand their health.
When should I get private health insurance?
The peace of mind that comes with private health insurance is beneficial at any age, but you may have heard that it’s beneficial to take out a policy when you’re younger. Here’s why:
Lifetime Health Cover loading (LHC): If you don’t take out hospital cover before you turn 31, you’ll pay a 2% extra premium for every year you delay. So, the earlier you get covered, the less you’ll pay in the long run.
Discounts for under 30s: If you’re 18-29, you can get up to 10% off your premiums with nib’s age-based discount. Eligible members receive a 2% discount for every year they’re aged under 30, up to a maximum discount of 10% for those of us aged 18-25. The best bit? You’ll keep receiving the discount until you turn 41 (and after that it’ll gradually phase out at a rate of 2% per year).
Check out our page, Discounts for people under 30 for more information.
Interested in becoming an nib member?
At nib, we encourage you to talk to our expert team about selecting a policy that best suits your needs and budget. If you're not sure where to start, contact us – we’re here to help. Alternatively, you can get a quote online in just a few minutes.
1Common treatments include a number of Medical Benefits Schedule (MBS) items commonly used across services covered by your policy. Support treatments means a number of MBS items used to support a principal treatment covered by your policy. Common and support treatments will be covered in line with the level of cover your product provides for the principal treatment. Refer to the nib Policy Booklet for more information.
2Associated treatment for complications means treatment provided during an episode of covered hospital treatment to address a complication that arises during that episode. Associated unplanned treatment means unplanned treatment provided during an episode of covered planned treatment that is, in the view of the medical practitioner providing the unplanned treatment, medically necessary and urgent. Associated treatments will be covered in line with the level of cover your product provides for the principal treatment. Refer to the nib Policy Booklet for more information.
31 day waiting period applies. Not available to QLD or TAS residents when covered by their State Ambulance Schemes or pension, concession and health care card holders who have ambulance services provided by State Ambulance Schemes (check entitlements with Centrelink if unsure).
4Excludes consultations and treatments performed at an Emergency Department. T&Cs apply.
5If your income is over $101k for singles, $202k for couples/families (for families income thresholds are increased by $1,500 for each child after the first) and you take out and maintain Hospital cover for the full financial year, you could avoid paying an extra 1% to 1.5% in tax via the Medicare Levy Surcharge (MLS). Visit the Australian Tax Office website for specific rules for calculating income for MLS purposes. This information is accurate as of 1 July 2025. See the ATO website for changes that may be made to income tiers from time to time.
^All information provided is for general advice only. Please contact us to discuss the right cover for you.
#Figures are general claims statistics taken for the full financial year July 1 2024 – June 30 2025 for nib Health Insurance, including nib Corporate Private Health Insurance, Real Health Insurance, Australian Seniors Health Insurance, GU Health Insurance, Qantas Health Insurance, AAMI Health Insurance, APIA Health Insurance, Suncorp Health Insurance, Priceline Health Insurance, ING Health Insurance.