Hi All,
This seems like a good place to ask the question since its about how far to go to save money.
If I get basic hospital cover to avoid tax (Private patient in public hospital), and my partner or I need to go to the hospital
A) Is it possible to present as a public patient and avoid $500 excess?
B) Is it wrong/immoral to do this?
Background:
Last tax year I had to pay the MLS (Medicare levy surcharge) as our combined income was over the threshold (Some capital gains pushed us into the 1.25% bracket but I expect to be in the 1% bracket for the foreseeable future).
That means I paid tax surcharges of around $2600 for not having private health insurance last year, I will probably have to pay a similar amount this year. I'm happy to pay that towards the government because I'm fortunate and believe in socialized medicine (I wish Australia went full NHS like the UK, dislike private health).
However, I can get a basic health policy that would make me a private patient in public hospitals and avoid the tax for $1760 a year with a $500 excess. That saves me $840 a year if we don't use it. Even though I think the system is crazy and all high earners should pay the tax, I also like to save money!
Other considerations
Don't care about choosing my doctor
Don't care about private rooms
Not interested in private hospitals
Do have a new infant, born in the public system (Great experience) (I believe children are excess free anyway)
I don't necessarily agree with your stance on socialized medicine and your belief that all high earners should pay tax (which means the biggest user of health system don't have to pay for it while the group of people who uses least of it have to pay for it = freeloaders)
However, since the thread is nothing to do with that, these are the considerations for you
The main benefit of Private System is to do with waiting list and the ability to choose the doctor (which can be a surgeon, really famous surgeon like Dr. Charlie Teo). Going public means you are on the waiting list and depending if you can persuade your GP to up your urgency status, then there will be a considerable wait.
You can present yourself as private patient in public hospital. My friends in medical profession said the main benefit of this is own room and probably a bit more pamper service. You still cannot choose your doctor and still in waiting list. The latter information came from my ENT surgeon so that adds more credibility. HOWEVER, you are effectively asking the hospital to bill private health insurer for a system that is already funded by Medicare, a service that should have been free for you.
That gives an effect of increased premium for every policy holders because of how insurance works (more claim = more premium). Additionally, since public hospitals are largely funded by State Government, it then budgeted for reduced hospital funding in an effort to encourage Public Hospitals to attract private patient and bill them accordingly.
That, in my view, is immoral.
Little wonder why people going to public system as private. So go ahead, do that and you will save your $500 excess
"All other in-hospital services where a Medicare benefit is payable unless they are Limited or Excluded"
That effectively excludes more than 90% of common services such as appendectomy, tumour extraction, tonsillectomy, etc and your basic cover is only covered for up to 3-5 procedures. Back 10 years ago, it used to be a hospital cover covers everything except blah blah blah
Now it becomes the other way around, the insurance only covers specific procedures and excludes everything by virtue of that exclusion clause. Be very careful. This makes your cover a junk cover.
Hope this helps
TLDR: Go ahead and do as you plan even though it contributes to your premium increase but please be careful to make sure your cover does not have a specific exclusion clause of "All other in-hospital services where a Medicare benefit is payable unless they are Limited or Excluded"
EDIT: I don't know why my numbering appears at 1,2,1,1 when in edit it says 1,2,3,4