Health Insurance Glossary

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Accident

Any injury inflicted as a result of unintentional, unexpected actions or events that require treatment by a registered medical practitioner. This excludes accidental illness, surgical procedures, pregnancy, injury or illnesses induced by alcohol or drug dependence and aggravation of a pre-existing condition.

Acute care certificate

After a patient has been hospitalized for 35 days health funds are not obliged to pay unless the treating doctor issues an Acute Care Certificate indicating why the patient needs to remain in hospital. Under section 3B of the Health Insurance Act 1973, an Acute Care Certificate needs to be completed by the Doctor for each 30 day period that a patient requires hospitalization. This is applicable to long term patients.

The 3B certificate can be reviewed by an independent committee called the Acute Care Advisory Committee (ACAC), formed under the Health Insurance Act. If the committee decides that the 3B should be revoked, health funds are only required to pay the equivalent of the benefit that would be payable to nursing home type patients – which is less than the Acute Care rate.

Agreement hospital

Agreement Hospitals are those hospitals that have a set charge that is agreed to with a health fund for the cost of accommodation and other hospital related charges. Health funds have these agreements in place to ensure that their members’ out of pocket expenses are minimized. These arrangements will vary between funds. Hospitalisation in a non-agreement hospital could generate considerable out of pocket expenses for the member.

Allied health services

These are extra services that may be included in a hospital policy as part of the core services of accommodation, theatre fees, and labour ward. Some allied health services include Dietetics, Speech Therapy, Occupational Therapy and Physiotherapy.

Alternative Therapies

Acupuncture -Treatment of a condition by influencing points on meridians, or 'lines of energy' known as the chi, which interconnect across the body surface and relate to major organs of the body. This is done by the insertion of fine needles.

Alexander Technique - Movement awareness and the re-education of that movement to relieve long-term muscular stresses.

Aromatherapy - A treatment using a specialised technique, incorporating essential oils that are individually chosen for each treatment.

Bowen Technique - The Bowen Technique is a treatment consisting of a specific sequence of gentle, rolling "moves" done across superficial muscles, tendons and nerves that effectively realigns the body and balances and stimulates energy flow.

Chinese Medicine/Herbalism - One of the oldest systems of herbal therapy in the world, it treats a wide range of conditions with the use of raw herbs as well as a vast array of prepared or patent medicines available in pill and powder form.

Dietary - The treatment of disorders and diseases, with specific substances, to correct or prevent an imbalance and to correct daily nutrition. It allows for the biochemical balance to be achieved through supplementation, that can be maintained with the daily diet.

Homeopathy - A scientific form of natural healing based on the Law of Similars, which states "like cures like". For example, a homeopathic remedy that could produce symptoms in a healthy person might cure those same symptoms in a sick person.

Hydrotherapy - A water based treatment for muscular strains and sprains, muscular fatigue and backache. Water is also useful in physiotherapy because patients who exercise in a buoyant medium can move weak parts of their bodies without contending with the strong force of gravity.

Hypnotherapy - Hypnosis or hypnotherapy is a method of lulling the conscious mind in order to reach the subconscious. When the subconscious is spoken to directly, old patterns and conditioning are reprogrammed and new ideas and positive suggestions are introduced. These positive suggestions are then used to help make the desired changes.

Kinesiology - The study of body movement, that identifies factors that block the body's natural healing process. These dysfunctions are rectified by attention to reflex and acupressure points and use of specific body movements.

Massage - Massage is a system of physical treatment aimed at alleviating tissue congestion. For examples of different massage techniques, see Remedial, Shiatsu, Kinesiology, Aromatherapy, Reflexology, Bowen Technique.

Myotherapy - Myotherapy is a method of relaxing muscle spasm, improving circulation and alleviating pain. To defuse ‘trigger points’, pressure is applied to the muscle for several seconds by means of fingers, knuckles and elbows.

Naturopathy - A wide range of diagnostic techniques are employed to assess causative factors, and treatment may involve dietary changes, herbal medicines, homeopathy, or nutritional supplements.

Reflexology - A system of manipulation of pressure points in the feet. It is believed that by stimulating these points, the body's own healing mechanisms can be mobilised.

Remedial Massage - A blend of approved, scientific massage techniques promoting efficiency in the body's systems, that in turn enhances the functioning of the entire person.

Shiatsu - The traditional Japanese technique of diagnosis and treatment is a method in which the thumbs and the palms of the hand are used to apply pressure to certain points. Deep pressure is used to stimulate these points, clearing blockages and restoring the flow of energy to the body.

Western Herbalism - Classical herbal medicine utilises the Hippocratic principles of treating the person, not the disease. It evaluates the patient's lifestyle and the emotional, circumstantial environment of the patient, not just the physical symptoms. Individually applicable herbal extracts and tinctures are then prescribed.

Ambulance

Emergency transport - An emergency is when immediate life saving treatment is required or where, in the opinion of a medical professional, the patient has received a significant trauma.

Ambulance subscription - A subscription from a recognised ambulance provider to cover medically necessary ambulance transport.

Ambulance Levy (for NSW and ACT only) - All residents of NSW and ACT who have hospital cover are entitled to free emergency ambulance transport within Australia. Transportation between hospitals may also be covered at the discretion of the Ambulance Service. If you are a pensioner, you may be eligible for free ambulance transport and you should pay the ‘exempt’ rate of hospital contribution which does not include the Ambulance Levy.

Ambulance cover in Tasmania - All Tasmanians as part of their residential taxes pay for ambulance coverage. When travelling interstate, Ambulance Services are covered through a reciprocal agreement.

Ancillary / Extras

These are benefits for health-related services that are not covered by Medicare. Health funds vary considerably in what they offer as services and benefits. However most include services such as dental, optical, physiotherapy, chiropractic and naturopathy.

The breadth of benefits covered and set benefits paid on services vary between polices and funds.

These are set benefits paid for health-related services that are not covered by Medicare.

Annual limit

These are benefits for health-related services that are not covered by Medicare. Health funds vary considerably in what they offer as services and benefits. However most include services such as dental, optical, physiotherapy, chiropractic and naturopathy.

Arrears

Membership contributions that have not been paid by the due date. Allowing payments to fall into arrears for more than two months means that the allowable unfinancial period has been exceeded and you are at risk of having your membership automatically cancelled by the fund.

Assisted reproductive services

The term Assisted Reproductive Services is used as a term for fertility treatments using reproductive technology such as IVF (In-Vitro Fertilisation).

Australian Government Rebate

The Australian Government provides a rebate on private health insurance to help Australians meet their private health insurance costs. The private health insurance rebate is income tested, which means the level of rebate you’re eligible for, depends on your annual income, age and the number of dependent children you have. The rebate means if the premium on your private health insurance is $1,000 (and you’re eligible to receive a 29.04% rebate), you’ll only pay $709.60 for your health insurance.

You can claim the rebate in one of three ways:

  • Premium reduction through your private health insurance: You can register under the premium reduction scheme for any financial year by applying to your health fund.
  • Tax rebate in your annual tax return: You can claim the health insurance Rebate at the end of the financial year in your individual income tax return.

More information on Australian Government Rebate

Babies

Persons covered under a Single membership are advised to change to a Family membership at least 4 months prior to the birth of the child to ensure that the child will be covered. Couples planning a family are advised to upgrade to a Family membership if the policy they are on does not include cover for obstetrics. In such instances there will be a 12 month waiting period before full benefits will be paid.

Benefit

Benefit ($). The dollar value paid to you by the health fund for a service or services received by an ancillary provider, hospital or medical providers.

Benefit (service). A tangible service provided as part of the hospital component of your health insurance policy.

Benefits are received in either:

  • A Calendar year: that takes in each 1st January to 31st December.
  • A Membership year: that is 12 months from the date that you joined the fund and each anniversary date thereafter.
  • A Financial year: that begins from the 1st July through to the 30th June.

Calendar year and membership year

Calendar year means 1st January to 31st December. Membership year commences on the date that the member joined the fund.

Certified age at entry

Related to Lifetime Health Cover, it is the age each member of a health fund is assigned when they purchase hospital cover for the first time.

Change of cover

The upgrading or downgrading of a health insurance policy. If you upgrade your policy, the benefit/s paid for any pre-existing condition, within the first 12 months, will be those benefits paid at the lower level of cover.

Claim

A direct payment paid to you either in the form of cash, cheque or payment into a nominated bank account - this latter option is not always available through all funds. If the claim is unpaid, a reimbursement cheque will be drawn in favour of the provider.

Increasingly, health funds are encouraging their members to settle their claims with extras providers at the ‘point of purchase’ through an EFTPOS style transaction called HICAPS, where the payment of the benefit is transmitted electronically to the provider. Any $ amount in excess of the set benefit set by the health fund is paid to the provider by the member.

Time limit on claims - Claims must be submitted within two (2) years of the date of service to be paid. Claims submitted after two years will not be paid.

Compensation and damages from other sources

Fund benefits are not payable where compensation and/or damages may be claimed from another source in relation to a condition, injury or ailment eg. Workers Compensation, Compulsory Third Party Insurance, Common Law, Sports Insurance, Travel Insurance, Litigation, Crimes Compensation.

Complaints about your fund

Refer to the heading of ‘Ombudsman’.

Co-payment

You could elect to pay a lower premium by taking out a hospital policy with a co-payment where you agree to pay an agreed amount per day/night each time a service is provided.

For example, a policy may have a co-payment clause that requires the member to pay the first $50 for each day's hospital accommodation. If your policy has such a co-payment and you were in hospital for 5 days, you would have to pay $250 ($50 x 5).

The total amount of co-payment a member can pay in a year is often limited to a set maximum amount.

Death and trauma cover

A few funds have this cover as an add-on benefit to some of their hospital or extras cover. Conditions and benefits vary widely between funds.

Dependent

  • An unmarried child/children with no dependants of their own
  • A full time student at an approved school, college or university and is under 25 years of age.
  • Dependants must be dependent upon their parents (they can, however, have some part-time employment - the amount they may earn varies between funds.
  • A child not attending school who is under 17 years of age - ages vary between funds.
  • Some funds offer an 'Extended Family Cover' that increase the maximum age that a dependant is able to remain on the family policy. The premium will reflect a relevant surcharge.

*Age may vary from fund to fund.

Families with non-dependent children - Some funds allow single, non-dependent children, aged 17 years and over to remain on the family membership regardless of whether they are working or living away from home. In some cases an additional premium is required.

Domiciliary care

Non-medical treatment such as personal assistance, showering and dressing which is not covered under home nursing.

Excess (also known as front-end deductible).

You could elect to pay a lower premium and take out a hospital cover policy with an excess or front-end deductible. This is an amount of money a member agrees to pay per hospital admission before health fund benefits are payable.

For example, if your policy has an excess of $200, you will be required to pay the first $200 of your hospital costs should you go to hospital as a private patient. This could apply every time that you go to hospital in a year, or it may be capped at a total amount that you would ever have to pay in a year. If you are unsure how the excess on your policy works you should ask your consultant.

Extras / Ancillary

These are benefits for health-related services that are not covered by Medicare. Health funds vary considerably in what they offer as services and benefits. However most include services such as dental, optical, physiotherapy, chiropractic and naturopathy.

The breadth of benefits covered and set benefits paid on services vary between polices and funds.

These are set benefits paid for health-related services that are not covered by Medicare.

Health Insurance Providers

A full list of Australia's Registered Private Health Insurance providers is accessible at www.phiac.gov.au.

In-patient

A person who is admitted to a hospital and occupies a bed.

Lifetime Health Cover

Lifetime Health Cover is a Government initiative introduced on 1 July 2000. It is designed to encourage people to take out hospital insurance earlier in life, and to maintain their cover.

Under LHC health funds are able to charge different premiums based on the age of each particular member when they first take out hospital cover with a registered health fund. For additional information, please read the Lifetime Health Cover article in our private health insurance education centre.

Major Dental

These include crowns and bridges, inlays, onlays and facings, periodontics, endodontics, orthodontics, surgical extraction of wisdom teeth and dentures. Precious metal fillings eg. Gold, may also be included in Major Dental.

Means Testing the Australian Government Rebate

Means testing is a process where a person's eligibility for a particular government benefit is determined by their level of income. For the Private Health Insurance Rebate, it means your level of rebate depends on your age, annual income and the number of dependent children you have.

More information on means testing the Australian Government Rebate

Medically necessary

In the opinion of a registered Medical Practitioner a specific treatment is necessary.

Membership

Membership refers to the health insurance contract that exists between the member and their chosen fund.

Medicare Levy Surcharge

The Medicare Levy Surcharge (MLS) is an additional tax (on top of the 1.5% Medicare Levy) that’s levied on to Australian taxpayers who earn above the MLS thresholds and don’t have private hospital cover.

The MLS income thresholds for 2014 -2015 are:

MEDICARE LEVY SURCHARGE
NO CHANGE TIER 1 TIER 2 TIER 3
Singles Less than $90,000 $90,001–$105,000 $105,001–$140,000 $140,001+
Couples/ Families Less than $180,000 $180,001–$210,000 $210,001–$280,000 $280,001+

What levy will I be charged in 2014 – 2015 financial year?

This table shows the MLS you’ll be charged by the Government if you, your spouse or your dependent children don’t have hospital cover.

MEDICARE LEVY SURCHARGE
NO CHANGE TIER 1 TIER 2 TIER 3
ALL AGES 0% 1% 1.25% 1.5%
SINGLES $900-$1,050 $1,312-$1,750 $2,100+
Couples/ Families $1,800-$2,100 $2,625-$3,500 $4,200

See Medicare Levy Surcharge for more information.

Ombudsman

The Private Health Insurance Ombudsman provides an independent service to help consumers with health insurance problems and enquiries. The Ombudsman can also deal with complaints from health funds, private hospitals or medical practitioners. Complaints must be about a health insurance arrangement.

The Ombudsman also publishes reports and consumer information about private health insurance.

Out of pocket costs/expenses 

An out of pocket expense is the 'medical gap' (which is the difference between the doctor's fee for services provided in hospital and the combined Medicare benefit and health insurance benefit) that the patient must pay.

An out of pocket expense could also be incurred for extras/ancillary services, when the benefit the health fund pays does not cover the cost of the service provided.

If the health fund has a negotiated agreement or gap cover scheme in place with doctors as well as ancillary providers, the out of pocket costs/expenses may be substantially reduced.

Out-patient services

Care for patients not admitted to hospital. Some services include – emergency department and emergency services, pathology, radiology and visits to doctor’s or specialist’s surgeries.

Pharmaceutical benefits

The Pharmaceutical Benefits Scheme (PBS) is a national scheme funded by the Commonwealth Government. The PBS subsidises the cost of an approved prescription drug, and private health funds are prohibited from paying a benefit for the fee charged for subsidised drugs dispensed on a PBS prescription. However, health funds pay the cost of a drug in excess of the PBS fee to a set maximum that varies from policy to policy and fund to fund.

Pre-existing condition, illness or ailment

The National Health Act 1953 specifies a pre-existing ailment as an ailment, illness or condition, the signs or symptoms of which, in the opinion of a medical practitioner appointed by the health fund, existed at any time during the six months prior to the member joining a hospital table or upgrading to a higher level of cover.

Health funds are able to impose a maximum 12-month waiting period for hospital treatment for ailments, illnesses or conditions that are considered to be pre-existing. When transferring to a higher level of cover, the payment of benefits are limited to the benefits received on the lower level of cover until 12 months of continuous membership is served on the higher level of cover.

Premium/s

The payment, or regular periodic payments, that a policyholder makes to own an insurance policy.

Public hospital charges

The cost of providing public hospital services is shared by the Australian Government and state and territory governments (through budget funding) and individual patients (through their purchase of private health insurance and paying bills from their own pockets).

Patients admitted to a public hospital can choose to be treated as public or private patients. Public patients receive treatment from doctors and specialists nominated by the hospital, but are not charged for their care and treatment. Private patients have the choice of their own doctor and may find that their private health insurance will cover most of the charges, depending on the level of cover.

Rate increase protection

A member who has paid his or her health insurance premiums in advance is protected from any increase in premiums that may occur during that period. However, he/she will be required to pay the increased premium rates once the date to which the advanced payment had been paid is reached.

Recognised providers in private practice

Health funds will only pay benefits for extras/ancillary services when the service is provided by a practitioner in private practice and is registered with the appropriate State or Federal Registration Board. The practitioner has to also be registered with each individual health fund.

Respite care

Respite care is residential or community care to assist frail older people and others with care needs to continue living in the community. It gives carers a break from their usual care arrangements.

It should not be taken for granted that ‘respite care’ will be covered under your hospital cover.

Same day procedures

Improved surgical techniques have assisted in various procedures being done in Australia as day surgery, and often with local anaesthesia only. This has contributed towards keeping the costs of hospitalization down.

Scheduled Fee

Benefits for services provided by medical practitioners are based on a Schedule of Fees listed in the Medicare Benefit Schedule, these benefits are called the Scheduled Fee. Medicare benefits are paid based on 85 per cent of the scheduled fee for out-patient services. For private patients in hospital Medicare will cover 75% of the Scheduled fee, while the remaining 25% is covered by the health insurance fund.

Single parents

There are a select number of health funds that provide specific cover/s for single parents with dependent children. These policies generally include restrictions or exclusions on the types of benefits covered e.g. obstetrics.

Transferring from another fund

You can transfer between funds with no loss of benefit entitlements provided you are transferring to an equivalent level of cover. If you are upgrading your level of cover, waiting periods for pre-existing ailments will apply for the higher benefits that you will be receiving.

Transfer – clearance certificate

When transferring between funds the new fund will require a clearance certificate that will determine your Federal Government Rebate as well as identifying you and your partner’s Lifetime health Cover status – including your certified age/s at entry, any applicable loadings, and accumulated days without hospital cover. The transfer or clearance certificate also reports on your claims history for hospital and extras (if applicable).

Travel Insurance

Some health insurance funds do not cover the member for hospitalization or extras/ancillary benefits when they travel overseas, and it they do the level of cover is inadequate and limited to non-elective surgery. It is recommended that members take out travel insurance when travelling overseas, as it provides cover for an extensive range of eventualities e.g. loss of baggage, hospitalization and death - to name a few.

Overseas travel - When travelling overseas Medicare has reciprocal agreements with UK, Italy, Malta, Ireland, Finland, The Netherlands, Sweden and New Zealand to be covered with the participating countries’ National Health Scheme.

These benefits vary between countries and should not be seen as a substitute for travel insurance.

With some health funds if you are travelling overseas for an extended period and plan to return within 1-2 years you can suspend your membership.

Unemployment cover

When a health fund offers ‘Unemployment Benefits’ it is based on the premise that the unemployment is involuntary. Not all health insurance funds and policies offer this benefit, and the criteria that a member is required to fulfil to take advantage of this benefit may vary from fund to fund.

Waiting / qualifying periods

All private health insurance funds have waiting periods. These can vary according to the fund, and can be found in your individual policy brochure.

The following waiting periods generally apply for new memberships and when upgrading cover for items not previously covered. For those not listed, please refer to your individual policy brochure or contact your health fund before treatment.

CONDITIONS / BENEFITS WAITING PERIOD
  • Accidents
  • Ambulance
24 Hours - 2 Months
  • Alternate/Natural Therapies
  • Chiropractic/Osteopathic
  • Dietetics
  • Eye Therapy
  • General Dental
  • Hospital accommodation and Theatre (not pre-existing)
  • Occupational therapy
  • Pharmacy
  • Physiotherapy
  • Podiatry
  • Speech therapy
2 Months
  • Optical
Six months
  • Major Dental – crowns, bridge work, surgical removal of teeth, gold inlays, orthodontics, periodontics.
  • Maternity/obstetrics
  • Orthotics
  • Pre-existing condition (any)
Twelve Months
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