Mental health is a key part of overall wellbeing, yet many Australians are struggling. According to Beyond Blue, half of all adults have experienced symptoms of anxiety or depression, and two in five have been diagnosed with a mental health condition.
If you need help, private health insurance can help reduce the cost of mental health care and provide faster access to treatment so you can get the support you need.
What health insurance covers mental health?
Mental health services can be covered under both hospital and extras policies, but what’s covered depends on the type of policy and the level of cover you have.
Mental health hospital cover
Hospital cover can provide cover for in-hospital psychiatric services and medical care for severe mental health crises. This can include treatment for conditions such as depression, schizophrenia, eating disorders and addiction.
However, full coverage is only available on Gold-level policies. Lower-tier hospital policies (Basic, Bronze and Silver) will only cover psychiatric services on a restricted basis.
Restricted cover means the insurer provides only a partial benefit for psychiatric services, which means you will not be covered for most or all of the cost of hospital treatment as a private patient, potentially leaving you with substantial out-of-pocket costs.
Mental health extras cover
Extras insurance can cover outpatient mental health services for managing mild-to-moderate conditions, including psychology, counselling, cognitive behavioural therapy (CBT) and hypnotherapy.
The specific services covered and the amount you can claim depend on your fund and level of cover, so it’s important to check your policy carefully.
What's included under mental health insurance cover?
Hospital coverage
- Severe depression
- Anxiety disorders (agoraphobia, claustrophobia, panic attacks)
- Acute psychotic episodes (including schizophrenia)
- Postnatal depression (mother-baby services)
- Drug and alcohol addiction issues
- Withdrawal from benzodiazepines or analgesics
- Eating disorders (anorexia, bulimia)
- Personality disorders (borderline personality disorder, bipolar disorder)
- Neuropsychiatric conditions caused by acquired brain injury
- Neurocognitive and neurodegenerative issues (including dementia)
- Medications prescribed as an inpatient
Extras coverage
- Counselling with accredited mental health social workers
- Counselling with accredited First Nations mental health care providers
- Psychologist sessions
- Telehealth counselling sessions
- Cognitive behavioural therapy (CBT)
- Anxiety management therapy
- Relaxation techniques
- Hypnotherapy
Why compare health insurance policies through Savvy?
How much is mental health insurance?
The cost of mental health cover depends on your provider, policy type and level of cover, with higher-level policies generally offering higher annual limits and more generous reimbursements.
When it comes to extras cover, you may be able to access some mental health services on lower-level policies, but the limits and types of services included are usually more restricted. Benefits will typically be paid per session, either as a set dollar amount or as a percentage of the session cost.
Let’s look at an example of how much cover could cost for a single person in Sydney.
As of February 2026, the cheapest extras cover with mental health benefits available through Savvy from around $8 per fortnight. This includes:
- CBT therapy with an annual limit of $120 per person ($240 per policy)
- Online CBT courses reimbursed between $35 and $59 per course
- No cover for in-person psychology services
At the other end of the scale, the highest-level policy on offer costs around $62 per fortnight, and includes:
- CBT benefits up to $150 per person, with 100% back for contracted providers
- Psychology benefits up to a $500 annual limit
- 75% of the cost covered per psychology session
Source: Compare Club, February 2025
So, how much of my treatment will this actually cover?
Private-sector psychologists set their own fees, which can vary. However, according to the Australian Psychological Society, in 2025–2026, the standard 46–60 minute consultation fee is $318.
For someone on the high-level extras plan above, a single consultation would be covered at 75% of the cost. This would mean:
- 75% of $318 = $238.50 reimbursed per session
- Out-of-pocket cost = $79.50
With the $500 annual limit on psychology sessions, you could use the full benefit for two consultations and get $33 off a third session before reaching the policy limit. Any additional sessions would need to be paid entirely out of pocket unless covered by Medicare.
What are typical waiting periods for mental health cover?
Whether you want to access hospital or extras mental health services, you will generally need to serve waiting periods. As standard, these are:
- Hospital psychiatric services: 2 months
- Extras psychology and counselling services: 2 months, though some providers may offer no waiting periods
Mental health waiver
If you have already served a two-month waiting period on a lower-tier hospital policy, you can upgrade to a Gold policy and get full psychiatric cover straightaway – though be aware that this waiver can only be used once in a lifetime.
Accessing immediate mental health support
If you need mental health support, there are services are available regardless of whether you have health insurance and can provide immediate, 24/7 support, including:
- Lifeline – 13 11 14
- Beyond Blue – 1300 22 4636
The Australian Government also funds Medicare Mental Health, a service that provides free, confidential support accessible without a referral or Medicare card.
Medicare vs private insurance: mental health cover
If you’re facing mental health challenges, Medicare is a good starting point. Under the Australian Government’s Better Access initiative, you may be able to get subsidised access to mental health professionals. To use these services, you’ll need to see your GP, who can assess your mental health and prepare a Mental Health Treatment Plan.
With a Mental Health Treatment Plan, you can claim up to:
- 10 individual sessions a year
- 10 group therapy sessions a year
However, fees are set by the practitioner. If your provider doesn’t bulk bill, Medicare will only cover part of the cost of your mental health treatment, meaning you may still have out-of-pocket expenses.
Private health insurance can complement this by offering additional cover and broader access to services.
For example, you may choose to use your Medicare-subsidised sessions first, then access extras cover once you’ve reached your annual Medicare limit.
Here's a look at what each could cover you for – and what to keep in mind when using Medicare or private health insurance for mental health care:
Medicare typically covers:
- GP visits (bulk billed or partial rebate)
- Public hospital treatment
- Up to 20 mental health sessions per year under a treatment plan
But…
- You may have a limited choice of provider
- You'll usually face longer waiting times to access care
- You will have out-of-pocket costs if your provider charges above the Medicare rebate
Private health insurance can provide access to:
- Private hospital psychiatric care (though typically only on Gold hospital policies)
- A wider choice of healthcare providers
- Potentially shorter waiting times for treatment (though you will still need to serve waiting periods)
But…
- Extras policies have annual limits, so you may still face out-of-pocket costs
- Full psychiatric hospital cover is only available on top-level hospital policies
- Not all extras policies include mental health benefits
