What’s a waiting period and why do we have them?
Why are there private health insurance waiting periods?
If you’ve ever visited a GP or been to a hospital in Australia, you’ve probably reaped the benefits of Medicare. Medicare gives Aussie residents access to free or subsidised treatment from doctors and specialists, both in and out of hospital.
But, how do you know which services are free and which ones you’re expected to pay for? And, how does the Government determine how much you pay?
That’s where the Medicare Benefits Schedule (or the MBS) comes in.
The MBS is a list of the types of consultations, procedures and tests that are covered by Medicare. Some of the types of services included on the list are:
Each of the items listed on the MBS has been given a ‘Schedule fee’ – a fee that the Government deems appropriate for the service. For some services, Medicare will cover the entire Schedule fee, but for others it will only subsidise you.
Who’s responsible for covering the extra 15% that Medicare doesn’t subsidise for non-GP services out of hospital? You.
Who’s responsible for covering the extra 25% for the specialist’s services in a private hospital? If you have private health insurance with nib, we will1. If you don’t have private health insurance, you’ll be required to pay the extra 25%. On top of the specialist services, there are also things like accommodation, theatre fees and medication, which (if you have private health insurance), nib will cover2.
However, this is where it gets more complicated. Despite these Schedule fees, ultimately a doctor or specialist can choose to charge what they want and many opt to set their fees higher than what the MBS recommends.
Related: What is nib MediGap?
There’s a number of reasons why a doctor might charge more than what’s recommended in the MBS, including geographic location, their reputation, qualifications and experience or even individual patient circumstances.
The Australian Medical Association (AMA) believes that the reason doctors are charging more is that the Schedule fees are simply set too low and in no way resemble the true cost of the service.
Regardless of why a doctor or specialist chooses to charge more than the Schedule fee, ultimately you are responsible for paying that extra amount (or what some people call ‘the gap’). That’s why it’s so important that you research your specialist before you book a consultation. Check out our article Tips for finding a great specialist: It’s all about knowing what to ask for more information.
If you’ve got a condition that means you’re going to regular consultations and receiving a number of tests or treatments – like diabetes or pregnancy – the costs that aren’t covered by Medicare could cause huge financial stress on you and your family.
Which is where the Medicare Safety Net (MSN) comes in.
With the MSN, once your out-of-pocket expenses for these services reach a certain amount (called your MSN threshold), Medicare will start covering a higher percentage of your costs – meaning you’ll pay less. For more information, check out nib’s Medicare Safety Net page.
Between Medicare, private health insurance and your own back pocket, we know it can be confusing trying to figure out who’s responsible for paying a doctor, hospital or specialist bill, so check out our article Who pays for what when it comes to your medical bills? for more information.
If you're an nib member heading to hospital soon, make sure you check out our Going to Hospital page. This tool gives you information on health insurance, tips on how to reduce any out-of-pocket expenses and helpful questions to ask your specialist. To find out the details of your current policy, chat to someone about your upcoming hospital visit or get some guidance, call us on 13 16 42.
1Coverage may differ depending on your level of cover and policy exclusions, waiting periods and limits.
2Coverage may differ depending on your level of cover and policy exclusions, waiting periods and limits and whether you go to an nib Agreement Hospital, a non-agreement private hospital or a public hospital.