What level of hospital cover is right for me? All tiers explained

Choosing a tier of hospital cover is arguably just as important as picking the right health insurance provider. In Australia, hospital cover comes in four tiers: Basic, Bronze, Silver and Gold. Each one has different levels of cover, and they include different treatments and services as part of your policy. Plus, the higher you go up the tiers, the more you’ll pay in premiums.

Confused? Thankfully it’s much simpler than it sounds. This guide will give you a greater understanding of the different tiers on offer, and armed with this information you’ll be able to decide between Gold, Basic and everything in between!

Most health insurers in Australia break down their hospital cover into four distinct groups – each of which has a specific level of cover. At the very top, there’s Gold, followed by Silver, Bronze and then Basic. Each tier includes a pre-set range of medical treatments and services that are included within their private health insurance policies.

As you might expect, the more you pay for your hospital cover, the greater the range of inclusions and vice-versa. When searching for the best hospital cover for your circumstances, think about the four tiers as a guiding framework that will help match up your healthcare needs with your budget.

Basic cover is the ‘starter pack’ of health insurance. For many Aussies, it’s chosen because it doesn’t cost that much and it helps you dodge the Medicare Levy Surcharge. It’s the cheapest health insurance option available, guaranteeing cover for essential healthcare needs but not much more.

Perhaps most importantly, Basic will cover you for ambulance services (except in Queensland, where the state already has your back on ambulances). It can also help you navigate the intricate maze of Lifetime Health Cover (LHC) loading, a rather complex web of premiums linked to your age and insurance history.

The bottom line? Basic doesn’t have many bells and whistles. These policies cover only the bare essentials, leaving the extra stuff for more expensive tiers. Sure, they’re a money-saving element that’s pretty attractive, especially if you’re doing it for tax-saving purposes. But here’s the secret: for just a little bit more in weekly costs, the Bronze tier will take your hospital cover up more than a few notches.

Rather than being just a small step above Basic, Bronze hospital cover is more of a middle ground between the thrifty and the comprehensive. It’s the sensible choice if you’re watching your wallet (and who isn’t these days?) without sacrificing essential healthcare safety nets.

Affordable and appealing to a younger crowd or budget-conscious families, Bronze generally includes plenty of common treatments needed across all ages, including:

• Hernias
• Appendix operations
• Tonsil removals
• Ear grommets
• Some cancer treatments
• Gynaecology
• Endoscopies

But wait, there’s more! If you go for a Bronze Plus policy, they’ll sneak in some extra items usually reserved for the Silver tier. You’ll find out more about these policies further down.

You could say the Silver hospital cover tier is akin to being ‘upper middle class’. In other words, it has a comprehensive range of healthcare benefits but won’t exactly break the bank for a large segment of Australian families. With Silver, you really do get what you pay for – yes, premiums are higher, but it’s also a sweet spot for those who want a balance between affordability and extensive coverage.

Here's what you can expect (depending on the insurer you go with):

• Heart and vascular surgeries
• Lung and chest treatments
• Dental surgeries (e.g. wisdom teeth removal)
• Podiatry surgeries
• Therapies for your back, neck and spine

Once again, there’s more on offer with Silver Plus policies, which are a popular choice for private health insurance these days. You’ll get some of the more deluxe items found in Gold cover but still only pay for a mid-tier plan.

What more is there to say for Gold hospital cover than that it’s like being a VIP? It’s exclusive, top-tier and, perhaps most importantly, expensive. It’s the pinnacle of health cover and you really will get premium healthcare services for the hefty price tag you pay. But is it worth it? That depends on what you want to get out of it.

This elite tier boasts a huge array of services:

• Pregnancy and IVF
• In-patient psychiatric treatments
• Weight-loss programs
• Joint replacements
• Cataract surgeries
• Insulin pumps
• Palliative care
• Pain management
• Dialysis
• Sleep studies

As you might expect, Gold is the preferred choice for couples who want to start a family, or for those approaching retirement who might need expensive healthcare treatment over the years to come.

But here’s a tip: many of the services included in Gold hospital policies, such as joint replacements and cataract procedures, can also be found in many Silver Plus policies. So before splurging on the most expensive level of cover, it’s wise to compare what health insurance options are out there and see if you can get what you want at lower premiums.

As you’ve probably guessed, ‘Plus’ policies are premium upgrades within the different tiers. They include additional services beyond the standard level of cover – albeit at an additional cost.

They tend to include select services from higher tiers, which gives you – the policyholder – access to extra benefits without the hefty premiums of an upper-tier plan.

Choosing the right hospital cover will hinge on your circumstances, your current healthcare needs and your budget. It's also important to note that waiting periods may apply if you decide to switch your health insurance to a higher level of cover or are joining a policy for the first time.

For those who want comprehensive cover that includes everything from pregnancy to cardiac surgeries, Gold or Silver Plus policies might be your best option. Bronze cover will suit basic hospital needs at a lower cost, while Basic is ideal if you only really want to avoid paying the Medicare Levy Surcharge.

The tier of hospital cover you choose (i.e. Gold, Silver, Bronze or Basic) generally won’t affect your eligibility for the rebate. However, if you nominate the incorrect tier for a premium reduction on your health cover then that may cause some issues.

As PrivateHealth.gov.au puts it: “If you choose to claim the rebate as a premium reduction, you will be asked to nominate a tier based on your estimated income.

“If you nominate a higher tier than your actual income, you will receive a lower rebate than your income entitlements. If that happens, you will receive a tax offset through your income tax return for that financial year.”

Selecting a tier of hospital cover is all about you as a person – or your family. Unfortunately, there’s no one-size-fits-all solution. The most important thing is that you factor in your current health needs, your budget and your preferred level of coverage. While Basic policies might suit some Aussies, others will need a much broader range of cover found in Silver or Gold tiers to give them peace of mind.

No matter which tier of hospital cover you choose, regularly review your policy to make sure it’s still meeting your needs over the long term.