Guest post: How to avoid out of pocket private hospital expenses

How to avoid out of pocket private hospital expenses - Ever-changing Life of a Mum

*This post is sponsored by Health Insurance Comparison

You’ve been paying your health insurance premiums each month, it’s rather expensive but you keep finding the money for peace of mind that your family is protected.

So it’s really frustrating that when you do finally need to go to hospital and make a claim on your insurance to find that not only do you need to pay the excess but you’re also you out of pocket a chunk of money to cover a range of expenses not covered by your policy.

This has happened to me. I originally took out private health insurance when my husband and I began planning to have our first baby. I’ve since had all three of  my children in the private hospital system. At the time, my hospital cover was considered top of the range, but I have still found myself out of pocket for certain costs, such as the anaesthetist.

I have to admit that it was a bit of a shock at first as we hadn’t factored in that extra expense, but after that we were better prepared and knew we needed to allow for these costs.

However, not all hospital visits are planned, so Sally from Health Insurance Comparison is here to offer some tips to help keep those costs to a minimum and your family budget looking healthy at the same time.

{Guest post} When your health insurance doesn’t cover everything – how to avoid medical gaps

If you have Hospital cover, you may assume that it will automatically cover all costs associated with a hospital admission. Unfortunately, this isn’t actually the case and most people will rack up some out-of-pocket costs (known as “gaps”) for services that are not covered by their policy. These type of “medical gaps” can be costly and unexpected so it’s vital to know if you can expect them and what you can potentially do to minimise the impact on your budget.

Are “gaps” inevitable?

Unfortunately for your budget, there will usually be a “gap” when you go to hospital as a private patient. This is because Medicare will only cover 75 per cent of costs associated with being a private patient.

Doctors can also choose to charge above the Medicare Benefits Schedule (MBS) fee for their services, which creates a “gap”.

Depending on your health fund, they may bridge some or all of the “gap” but if not, this needs to come out of your own pocket.

Will your health fund help?

Some health funds have “gap cover” schemes, which means that they can meet some or all of the “gap”.

There are 2 types of “gap cover” – No Gap and Known Gap. The best option for your budget is “No Gap” cover, as this means you won’t have a “gap” of any description and your health fund will take care of it. “Known Gap” cover means that there will be a “gap” but you will at least know what it will be before going to hospital.

Doctors can choose whether they want to participate in health fund “gap” schemes so this doesn’t necessarily mean that you will be covered. If your doctor decides not to enter into an agreement with your health fund, there will still be a “gap” that needs to be paid.

What to check right now

Firstly, you need to know whether your health fund has a “gap cover” scheme that you can potentially take advantage of if any member of the family needs to go into hospital.

If they don’t, you have the option to switch to one that does but don’t forget to make sure that your new policy is definitely the best option for your family’s health needs and offers great value for money. Don’t make the switch solely on “gap cover” grounds, or you may find that you’re actually losing out more in the long term if you’re not covered for services that your family will need. If you’re worried that this sounds very time consuming and confusing, then use an online comparison service such as Health Insurance Comparison to help find the best cover for your needs and budget, including your “gap cover” options.

What to check in the event of a hospital admission

If one of the family needs to go to hospital, you’ll need to find out whether the doctor that you are referred to is willing to get involved in your health fund’s “gap cover” scheme.

If they are, this can relieve a lot of the financial burden of the “gap” but be aware that there may still be some other out-of-pocket costs to contend with, depending on your policy.

If they won’t participate in your health fund’s “gap cover” scheme and treatment isn’t solely dependent on their services, you may want to think about asking for a referral to a different doctor. This may then allow you to take advantage of your “gap cover”.

Putting money aside

Even with “gap cover”, there could potentially be a few out-of-pocket costs associated with a hospital admission and this can still impact on your budget if you don’t know that it is going to happen. It can therefore be useful to put a bit of cash aside to cushion the blow to your finances.

For more information or to compare health insurance funds, visit Health Insurance Comparison at


13 thoughts on “Guest post: How to avoid out of pocket private hospital expenses

  1. Very timely Erika I always like to check our health insurance every year to make sure we are still getting the best value for money. It is something that we can’t really afford but I can’t afford to be without if that makes sense.

  2. That’s great advice. We changed our health insurance around a year or so ago – thanks to Health Insurance Comparison and have been very happy with the change.

  3. I’ve been in hospital (privately) quite a few times and both my sons have been in so I’m used to expecting the multiple expenses. My husband, however, had his first hospital stay recently and was horrified at all the separate costs! We do have private health insurance – with an excess to keep the monthly payments down. For me, the main thing is being able to choose when and where medical procedures will be carried out.

    • I feel the same way. My daughter needed a minor operation when she was younger and she was admitted just a couple of days after seeing the doctor, I was amazed at how quickly it was all arranged. That being said on top of our hospital excess, we were out of pocket from the doctor and the anesthetist but we were made aware of these costs prior to the surgery.

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