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Private health insurance can help you cover the costs of medical treatment and care that aren’t included under Medicare. By taking out a policy and paying regular premiums, you can access to a choice of hospitals and doctors, along with a wide range of other benefits.

If you want to explore your options, Savvy can help you compare health insurance policies from a some of Australia's leading insurers in just a few clicks. Get started with a free quote today.

Types of health insurance

There are two main types of health insurance available in Australia, available to purchase separately or as a combined policy. Policies are available as single, couple and family plans, allowing you to choose coverage that suits your needs:

Hospital cover

Hospital cover helps pay for in-hospital treatment as a private patient in either a public or private hospital. It may also give you the option to choose your doctor, access private hospital care and avoid public hospital wait times, depending on your policy. There are generally four different levels of cover you can choose from:

• Basic cover: covers only a small number of hospital treatments.
• Bronze: includes everything in Basic, plus additional treatments.
• Silver: covers more than Bronze, offering a broader range of services.
• Gold: the highest level, covering all treatment categories.

Extras cover

Extras cover helps pay for out-of-hospital treatments that Medicare doesn’t cover. It’s designed to help with preventative and remedial treatments that support overall health. Extras policies range from basic to comprehensive, with coverage varying by provider:

• Basic: covers a limited range of services, often with lower benefit limits.
• Mid-level: includes more treatments and higher rebates.
• Comprehensive: covers a wide range of services with the highest benefit and annual limits.

Common health insurance inclusions and exclusions

Hospital cover, as its name suggests, covers treatment from doctors and specialists which are provided in a hospital setting. It may cover the following areas:

• Consultations with doctors, specialists and anaesthetists
• Tests administered whilst you’re in hospital or undergoing surgery
• Cost of surgery or other treatments
• Specified allied health services such as psychiatrists, psychologists and pain management specialists
• Ambulance cover*

*Not included in all hospital cover. Ambulance cover differs between states and territories, with some providing free cover to residents for transport within their state or nationally. Check with your state ambulance provider or health insurer for details of any cover offered.

What isn’t included under hospital cover?

Some of the items which are commonly excluded by hospital insurance include:

• GP visits (for which part of the cost is covered by Medicare, less any gap that is charged)
• Cost of visiting a public hospital emergency department (which is also covered by Medicare)
• Most x-rays, MRIs, CT scans and blood tests which are performed on outpatients
• Medical procedures not considered medically necessary (such as breast augmentation or liposuction purely for cosmetic purposes)

Extras cover

This may offer cover for treatments given outside of a hospital setting which aren’t covered by Medicare. Many preventative and remedial forms of treatment are covered by this type of insurance, which may include:

• Dentistry and major dental surgery
• Orthodontics (such as braces or aligners)
• Optometry (lenses, glasses and frames)
• Non-PBS pharmaceuticals (medicine and drugs not listed under the Pharmaceutical Benefits Scheme, so not subsidised by Medicare)
• Psychology (and other treatments for mental health conditions)
• Dietetics – including assistance with nutrition, diet and weight loss programs
• Gym memberships – offered by some health funds and subject to conditions
• Vaccinations – particularly if you’re travelling overseas and require less common vaccinations such as typhoid
• Supply and fitting of hearing aids
• Physiotherapy, other manual therapies and exercise programs
• Chiropractic treatment to assist with back or spinal issues
• Podiatry (treating any foot or ankle conditions)

What isn’t included under extras cover?

The treatments which aren’t routinely covered by extras health cover will vary between different health insurance providers and the level of cover chosen, but may include:

• Laser eye surgery
• Some alternative medicines and therapies
• Hypnotherapy

The amount of benefits or rebates available under extras cover will be limited to a set dollar amount per year. How much that limit is will depend on the level of cover you choose to purchase. For example, under a cheaper extras cover policy, you may be covered for up to $800 for major dental work, but if you choose a more expensive policy, you may be covered for up to $2,500 instead.

Private health insurance vs Medicare

Medicare, Australia's public health system, provides free or subsidised access to essential healthcare services, such as GP visits to general practitioners, hospital care and certain medical procedures, to citizens, permanent residents and select visa holders. However, it doesn’t cover everything.

This is where private health insurance comes in. It is optional cover that complements Medicare by providing access to additional services and treatments not available in the public system. It also allows you to be treated in private hospitals, choose your own doctor or specialist, and often experience shorter waiting times for elective procedures. While it comes at a cost, requiring you to pay for your cover, it can give you greater flexibility and choice in managing your healthcare needs.

Top 10 health insurance companies in Australia

The Australian health insurance market is dominated by two major providers, Medibank (including ahm) and Bupa, which together hold over 50% of the market. The top five insurers collectively account for 81.8% of the market, while smaller providers serve a more niche customer base.

Here’s a breakdown of the top 10 health insurers by market share:

1. Medibank (including ahm) – 27.1%
2. Bupa – 24.9%
3. HCF – 12.5%
4. nib – 9.6%
5. HBF – 7.7%
6. Teachers Health – 2.6%
7. Australian Unity – 2.2%
8. GMHBA – 2.2%
9. Defence Health – 2.0%
10. CBHS – 1.5%

While these large insurers dominate the market, smaller health funds often cater to specific groups, such as industry professionals or regional communities, offering competitive benefits tailored to their members.

Source: State of the Health Funds Report, March 2024

How to get health insurance

1. Figure out what you need

   Consider what type of cover suits you best, whether that's hospital, extras or both, considering what particular services you're after and what you can do without for now.

2. Fill out our quick online form

   Apply for a quote via the Savvy websites, providing us with your personal details and health insurance preferences.

3. Speak with a health insurance advisor

   Consider what type of cover suits you best, whether that's hospital, extras or both, considering what particular services you're after and what you can do without for now.

4. Choose your policy and get covered

   Once you've found the best fit, you can take out your policy and enjoy the protection you need.

How much is private health insurance?

The cost of private health insurance in Australia depends on a range of factors, including:

• Level of cover: basic policies cost less but cover fewer services, while comprehensive policies cover more treatments at a higher price.
• Excess and co-payments: a higher excess can lower premiums, but you’ll pay more out of pocket if you need hospital treatment.
• Who is insured: policies for singles are cheaper than those covering couples or families.
• Government rebates: the Australian government provides a rebate up to 32.81% on private health insurance for eligible income earners, helping to reduce costs.
• Lifetime Health Cover (LHC) loading: if you don’t take out private hospital insurance before turning 31, you’ll be charged a 2% loading on top of your premium for every year you delay.
• Your insurer: premiums vary between insurers, so it’s always worth comparing policies to find the right balance between cost and coverage.

This means the cost of private health insurance can vary widely based on your circumstances. For example:

• A 30-year-old single person earning under $97,000 with basic hospital cover (no extras) and a $750 excess might pay around $20 per week.
• A family of four with gold hospital and top-level extras cover, a $500 excess and a high claim-back rate (up to 90%), could pay $180 per week.

On 1 April 2025, health insurance premiums began to rise by an average of 3.73% – the biggest increase since 2018. How much your premiums will change, however, depends on your insurer. While some premiums are increasing by as much as 9.56%, other providers are not increasing their prices at all.

Health insurance and tax in Australia

In Australia, having private health insurance can offer tax benefits in addition to providing extra healthcare coverage. While private health insurance is not tax deductible, holding an eligible policy can reduce your tax liability by avoiding the Medicare Levy Surcharge and claiming the private health insurance rebate.

Medicare Levy Surcharge (MLS)

If your income exceeds a certain amount set by the government, you may have to pay the Medicare Levy Surcharge, which is an extra charge on top of the Medicare levy. In the 2024 – 2025 financial year, the earnings threshold is $97,000 as a single person or $194,000 as a family; from July 2025, these limits will rise to $101,000 for singles and $202,000 for couple and families. The surcharge is 1% to 1.5% of your income, depending on your earnings.

However, you can avoid this surcharge by taking out basic hospital cover with an approved insurer with an excess of $750 or less (for singles) or $1,500 or less (for couples/families).

Private health insurance rebate

The Australian government’s private health insurance rebate is designed to make private health insurance more affordable. If you hold hospital or extras cover, you may be entitled to the rebate, which can be claimed either as an upfront reduction on your health insurance premiums or via your tax return. Eligibility depends on your income and age, with rebates up to a maximum of 32.812% available depending on your circumstances. As with the MLS, the 2024 – 2025 earnings threshold is $97,000 for a single person or $194,000 as a family, rising to $101,000 for singles and $202,000 for families in 2025.

Cheap health insurance

With an array of health insurance products available, it’s easy to find a policy that suits your needs and budget. If you're looking for the most affordable options, whether to save on costs or avoid extra tax, here are some of the cheapest types of cover available:

Cheapest to avoid tax

To avoid the Medicare Levy Surcharge, you need to have hospital cover – but this only needs to be the most basic level of insurance. These policies offer minimal health benefits but can help at tax time. The cheapest basic hospital cover can be as low as around $20 a week.

Cheapest dental cover

Dental insurance is typically included in extras policies. Basic cover for general dental (excluding major procedures) starts at $3–$4 per week, though it won’t cover more advanced treatments.

Cheapest ambulance cover

Emergency ambulance cover is often included in basic hospital policies available from around $20 per week. Alternatively, standalone ambulance-only cover is available, with prices starting at $60 per year (just over a dollar a week) for singles, depending the state or territory you're in.

Note: Queensland and Tasmania provide free ambulance services for residents.

No matter the level of cover you choose, you can make savings on your health insurance premiums by:

• Reviewing your plan: make sure your policy covers the services you use or are likely to use. Cutting back on extras you don't need can help lower your premiums without sacrificing essential care.

• Switching providers: if you're not happy with your current policy or think you could get the same level of cover for less, it's always worthwhile comparing your policy with others in the market to find better deals or more suitable cover for your needs.

Pros and cons of health insurance

Is private health insurance worth it?

Private health insurance helps cover medical costs you’d otherwise pay out of pocket, offering a financial safety net and greater peace of mind. It also gives you more control over your healthcare, including shorter wait times for elective procedures and access to private hospitals.

Even if you're young and healthy, it can still be worthwhile. Taking out hospital cover before turning 31 helps you avoid the Lifetime Health Cover (LHC) loading, which increases premiums if you take out cover later. It can also reduce your tax bill by helping you avoid the Medicare Levy Surcharge if you earn above a certain threshold.

However, whether it’s worth it depends on your needs and budget. Before making a decision, consider:

• What you’ll use: think about the health care treatment you have needed in recent years and choose a level of cover that offers inclusions you may need. For example, if you have 20:20 vision and are relatively young, you’re unlikely to want laser eye correction surgery cover.
• What’s excluded: check the exclusions on any policy you’re considering to make sure nothing vital you need is left out. For example, if you live with Type 1 diabetes, a health insurance policy that excludes cover for the cost of an insulin pump or blood glucose monitoring devices may not be the best option.
• Cost: your earnings and expenses will determine the level of health cover that you’re able to afford. Not everyone can afford gold hospital cover, which is why there’s a range of policies available to suit different budgets.
• Availability: people living in rural and remote areas of Australia may have fewer options for their health care than others who live in a major city. If you have a choice of several private hospitals nearby, private hospital cover may allow you to choose where you receive your treatment. However, if you live in a remote area where there aren’t any private health facilities, this type of cover may be less useful if you wish to have your medical treatment close to home.