Common health insurance terms and definitions

05 October 2017

Lifetime Health Cover, Medicare Levy Surcharge, Annual Limits…what does it all mean?! The private health insurance world can be full of acronyms and complicated jargon. So to help you understand the meaning of some common terms and phrases, we've put together the A-Z of health insurance terms. So when you're doing your research or a health insurance comparison, you'll know an MBP from a BLP – that's Minimum Benefits Payable and Benefit Limitation Period, by the way.

The A-Z of health insurance terms

Annual Limits or Annual Benefits Limits: the maximum amount of benefits payable for a specific good or service in a calendar year. For example, with Suncorp Health Insurance Starter Extras Cover you have an annual limit of $150 on Optical.

Benefit Limitation Period (BLP): a period of time during which a new private health insurance customer is entitled to restricted benefits or Minimum Benefits Payable (MBP) for a particular condition or treatment.

Extras Cover: cover for a treatment that is intended to manage or prevent a condition, for which benefits are payable.

Gap payment or out-of-pocket expense: a charge or fee not covered by a health insurance provider or the Medicare Benefits Schedule (MBS). For example, Suncorp Health Insurance will not cover medical fees above the MBS fee or any hospital excess.

Hospital Cover: cover that includes benefits for fees and charges for hospital treatments.

Lifetime Health Cover (LHC): a Government initiative designed to encourage people to take out hospital insurance with a private health fund earlier in life and to maintain their cover. In most cases, to avoid this loading, you will need to take out Hospital Cover with a private health insurer before the 1st of July following your 31st birthday. If you don't have Hospital Cover by this time, you will pay a loading percentage fee on top of your Hospital Cover premium, which will increase by 2% for every year you do not have cover, up to a maximum of 70%. For example, if someone waits until they turn 40 to get Hospital Cover, they will pay an additional loading of 20% more on their health insurance premium, compared to someone who joined before they were 31.

Medicare Benefits Schedule (MBS): the schedule of fees for medical services set by the Federal Government. The percentage of this fee that you can claim varies. Bulk Billing at the GP is one example of a full 100% claim through the MBS.

Medicare Levy Surcharge (MLS): a levy on Australian taxpayers who don't have an appropriate level of private hospital insurance and who earn above a certain income. It's designed to encourage people to take out private hospital cover, and where possible, to use the private hospital system to reduce demand on the public system. The base income threshold (under which you don't have to pay the MLS) is $93,000 for singles and $186,000 for families.

Minimum Benefits Payable (MBP): the minimum amount of benefits that a health insurance fund is required to pay under the Private Health Insurance Act.

Pharmaceutical Benefits Scheme (PBS): the scheme under which the Federal Government subsidises the cost of some medicines.

Pre-existing condition: means a condition, the signs or symptoms of which, in the opinion of a medical practitioner appointed by a health insurance provider, existed prior to joining or upgrading health insurance cover.

Premium: the amount of money that you pay for your policy.

Private hospital: a hospital that is deemed under the Private Health Insurance Act to be a private facility.

Public hospital: a hospital owned and operated by the State, Territory, or Federal Governments.

Restricted Benefits: the lower level of benefits payable for some services. Benefits paid will be equivalent to a shared-ward of a public hospital. There is usually a gap payment if you choose to be treated for a procedure with a restricted benefit.

Waiting Period: a period of time during which you must continuously hold a policy for a particular product before you're entitled to receive a benefit. For example, Emergency Ambulance transport has a 1 day waiting period with all Suncorp Hospital and Extras Cover, while other benefits require a longer waiting period.

Organising health insurance has never been easier – with Suncorp Health Insurance you can get a Hospital or Extras Cover online quote within minutes. If you're unsure of what you need, use our handy health insurance comparison table to compare Hospital and Extras Cover.

Or if you'd like to speak to us regarding other health insurance terms or find out which policy might best suit your needs, chat to our Suncorp Health Insurance specialists on 13 11 55 (Mon-Fri 8am-8pm & Sat 9am-1pm AEST/AEDT).

Suncorp Health Insurance is issued by nib health funds limited ABN 83 000 124 381 (nib), a registered private health insurer, and is marketed by Platform CoVentures Pty Ltd ABN 82 626 829 623 (PC), a Suncorp Group company. PC is an authorised agent of nib and receives commission from nib.

Information is intended to be of a general nature only and any advice has been prepared without taking into account any person's particular objectives, financial situation or needs. You should make your own enquiries, consider whether advice is appropriate for you and read the relevant Product Disclosure Statement or Product Information Document before making any decisions about whether to acquire a product.

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