With over forty health insurance funds in Australia, it’s a fiercely competitive market at the best of times. When it comes to comparing the available policies with all these health funds, it can often be an overwhelming experience trying to decipher the important differences.
To put it simply, a ‘junk’ policy is insurance jargon for a “basic” or “cheap” policy that provides you with a low level of hospital cover at a low cost.
1. Accidents may only be covered if you seek medical attention within a set amount of hours (usually 24) and may only cover you for a set amount of days. This could leave you seriously out of pocket for procedures and services, especially if you are in the beginning/mid stages of treatment.
2. Choosing a policy where you are a public patient in a private hospital still requires you to wait on the public list with everyone else. In most cases it is advertised that you can choose your doctor/specialist but this can be limited as your choice of practitioner may not work in the public sector.
3. Procedures covered in ‘Junk Policies’ like wisdom teeth, gynecological procedures, knee investigations and reconstructions, can often require additional when you go in for the procedure. For example, if you were to go in for a gynecological procedure for Endometriosis surgery you may get the minor surgery covered but if you require major surgery eg) something cancerous to be removed you could either find yourself out of pocket or waking up with a surgery half done (depending on the finer details of your policy). It is important to ask specifically what Medicare item numbers are required for your procedure before going under.
4. Some of the more serious services like rehabilitation and palliative care often lie under ‘Restricted Services’ which means you are limited to a public hospital and unfortunately can end with long wait periods due to limited facilities. These services are important as they are required in the final stages of an accident, injury and/or illness.
Remember ‘Junk’ policies can still serve some sort of purpose. For people earning over a certain threshold trying to avoid the Medicare Levy Surcharge and for people wanting to avoid Lifetime Health Cover Loading but are happy not to have a more comprehensive level of basic cover.
At iSelect, our aim is to tailor a policy suited to your needs and budget without compromising your health and to ensure you understand your level of cover.