When you're considering taking out a private hospital insurance policy to cover your future medical needs, you need to be aware of the restrictions and waiting periods that can affect your ability to make a claim.
In particular, if you are planning to use your health insurance to cover treatment for an illness or injury sustained before taking out the cover, you will have to comply with the 'pre-existing condition' waiting period.
While health funds are unable to discriminate against any individual in regards to their health, Australian health insurance providers can impose a 12-month waiting period on benefits for hospital treatment related to pre-existing conditions.
To understand whether this restriction may apply to you, here are the key factors you need to know.
What counts as a pre-existing condition?
According to the Private Health Insurance Ombudsman (PHIO), a pre-existing condition is any ailment, illness or condition that displays signs and symptoms within the six months before an individual is covered by their health insurance policy.
Typically, a medical advisor appointed by the health insurance provider will make a decision on whether the signs and symptoms were present during the allotted time. This means that a direct link must exist between the condition and the health of the policyholder over the prior six-month period.
These signs include obvious symptoms and negative health effects, but exclude indirect influencers such as family history and other risk factors. It is not necessary for the condition to have been diagnosed in the six months prior to taking out health insurance; only for the signs and symptoms to have been present.
Why do the waiting periods exist?
If people had the ability to take out private health insurance and immediately begin using their benefits for significant and costly treatments, their premium payments would fail to cover the claims they submitted.
This expense would therefore fall onto long-term members who have been paying premiums for extended periods of time. Allowing this system to remain in place, health funds would soon find themselves out of pocket and would likely continue to raise premiums to reduce this gap.
Waiting periods exist to protect insurers and policy holders from premiums being priced beyond the reach of average Australians.
If you're unsure whether the pre-existing conditions waiting period applies to you, or you would like information on any other health insurance rules and restrictions, contact the team at HICA today.
HICA can offer specialist advice and guidance on Australian health insurance providers and their policies to ensure you choose the right cover for your needs.