Health Insurance Over 50: Not Kid Stuff

Over 50 Health InsuranceWhen you reach a certain age, your health insurance needs take on a whole new definition.  The coverage you purchased when you were a young adult, had small children at home and enjoyed a certain lifestyle and level of activity is not adequate for your health care needs after age 50.  For many older Australians, health problems develop that are a natural part of the aging process, while for others poor nutrition, lack of exercise, or simply a history of hard living can catch up with our bodies. Adopting a healthy lifestyle later in life is always a good idea, and obtaining good health care coverage is very important.

Every Australian can get basic health care through Medicare. But Medicare may not be enough for individuals over 50, since its coverage options are limited and the medical needs of seniors are almost always greater than those of younger people. For this reason, comparing health insurance plans is important when it comes to protecting yourself financially and medically in later life.

Seniors face the need for more prescription medications, more surgical procedures, and more ancillary services such as hearing aids, vision, and dental care. Medicare coverage alone limits your choice of hospitals that will admit you for treatment, and which physicians you can enlist for your examinations, surgical procedures, and any other medical needs you may have.   Additionally, if your health insurance is limited to Medicare with no private policy in place, your coverage may not be adequate to cover all medications and treatments you may need; some medical services are not covered by Medicare at all.

Seniors who do not have a pension can apply for the Commonwealth Seniors Health Card before purchasing private health insurance. Australians over 50 with a fixed income who do not qualify for a pension can qualify for this card to help cover some prescription medication and medical services costs.

If you’re an individual over 50 who has a pension and are looking to enhance your health insurance coverage, comparing private insurance plans is a great start to learning all you need to know about securing your health policy options. Although all private health insurers offer options for improved care above your Medicare supplement, each fund offers its own plan structures, coverage options, and premium costs, so it pays to compare.

Whether you are already facing additional medical services related to an age-related injury or illness, or you are simply planning ahead and making sure your health insurance coverage is adequate as a prudent measure, comparing health insurance plans and purchasing a private insurance policy can provide financial security if extra costs arise from medical services that are not covered by Medicare alone.

Seniors with a pre-existing condition may face a waiting period of up to 12 months before their private coverage can be used for treatment. It is important to compare private health insurance policies and determine which have waiting periods that may not work for you. Remember, no medical insurer can refuse to provide you with coverage based on your age or any pre-existing conditions.

Your private medical plan may cover services specific to seniors that are not covered by Medicare, including ambulance costs, home nursing care, podiatry services, physiotherapy, occupational therapy, cataract surgery and glasses, and more.

Remember, the Australian government reimburses 30 percent of the cost of every private medical plan premium, a great incentive to make sure your health insurance coverage is adequate.  And that percentage increases for seniors to 35 percent at age 65, and 40 percent at age 70, in order to make private coverage more affordable to aging citizens who are often living on a pension alone, with no other source of income. Those seniors who do have more income sources are still eligible for the same government reimbursement rates on private insurance premiums.

It may be a wise idea to get a complete physical and discuss with your physician which health insurance features you should have in place to meet your specific medical needs.

Many seniors take advantage of their new found freedom from work and raising children to travel. Anytime you travel overseas, make sure to contact your health insurance provider to suspend your premiums for up to three years while you are away, without any consequences to your Lifetime Health Cover. Check with your health fund to see if your absence and premium suspension will affect your policy when you return.

The lifestyle of a senior today can be full and rewarding, particularly since there is time to do so many things you may not have been able to do when you were younger, working and raising a family. Living an active, healthy lifestyle is certainly the best option for every older Australian, and securing a good private health insurance policy can help you maintain your health and your pace. Your health insurance is a ticket to the kind of financial and medical security that can keep you doing the things you love, even when the nuisances of age catch up with you.

Lifetime Health Cover

Lifetime health coverOn July 1, 2000, the Australian government put its Lifetime Health Cover in place, an initiative designed to motivate everyone to purchase private health care policies as early in life as possible, and to maintain these plans throughout their lives.

In Australia, your health insurance is not ‘risk-rated’ like other types of coverage. Private health carriers cannot refuse to insure anyone, and all policyholders must be charged the same amount for the same level of benefits, regardless of their risk profile and how likely they might be to use heath services.

Lifetime Health Coverage (LHC) is a financial loading that helps pay for Australia’s widely inclusive health insurance system, and can be paid to secure private hospital coverage in addition to your health insurance policy’s base rate premium. Individual who purchase LHC at a young age and maintain it will end up paying lower health insurance premiums than those who purchase it later in life.

Keep in mind that LHC loadings apply only to hospital coverage, and not do not apply to your private health insurance policy’s general treatment coverage, nor does it include ancillary or non-traditional treatments – acupuncture and chiropractic services, for instance.

Australians can avoid paying a LHC loading by simply purchasing hospital coverage no later than the July 1 date immediately following your 31st birthday. In other words, if you turn 31 on December 12, 2011, you have until July 1, 2012 to purchase your hospital coverage and avoid any LHC loading costs. After this date, you can be required to pay a two percent fee for every year over 30 that you are when you purchase private hospital coverage. If you wait until you’re 40 to buy hospital coverage, you could be paying an extra 20 percent in LHC loading fees, and if you wait until you’re 50, that figure goes up to 40 percent, with a cap of 70 percent before you’re done. Even if you fall into this loading fee limbo, make sure you continue to compare health insurance policies routinely to make sure you are still getting the best deal possible on the bulk of your coverage.

New migrants to Australia age 31 or older are exempt from LHC loading when you purchase your hospital coverage within a 12 month period of registering for Medicare benefits. Delaying the purchase of private hospital coverage beyond 12 months will land you in the same two percent LHC loading bracket for every year over that you are over 30. Once you purchase your hospital coverage and keep it active for 10 years without interruption, the LHC loading fee will be removed from your hospital coverage premium. If you cancel the hospital coverage at any time in the 10 year window, you will probably become liable for the LHC loading once again when you repurchase it.

There are exemptions from the LHC loading; for instance, anyone born on or before July 1, 1934 is free from this tax, no matter when you purchased your hospital coverage. All you will pay for is your hospital coverage base rate.

Sometimes, calculating your LHC loading rate can be confusing. The Private Health Insurance Ombudsman (PHIO) has developed a Lifetime Health Cover Calculator, which will help you to figure out your LHC loading. When comparing health insurance policies, this calculator can help you predict and budget your total medical coverage costs over the years.

The Lifetime Health Cover loading is an important element in making Australia’s health insurance program work for the majority of Australians. By planning ahead, and making knowledgeable decisions about every aspect of your health insurance coverage, you can have good, comprehensive coverage at the lowest cost possible.