Good cover essential for mental illness


Reforms waive waiting periods for mental illness cover

Feeling blue


There’s good news for consumers drained dry by the rising costs of health insurance – or at least potentially good news. The most wide-ranging reforms for health insurance in the last two decades are underway, with most changes coming into effect from April 2019.

One of the changes has already come into effect: Mental health cover waiting periods were waived on 1 April 2018.

Better cover for mental illness is essential

We all have good days and bad days. But every year, one in five Australians experiences anxiety, depression and other mental health conditions preventing them and their families from going about their normal life.

Young people (15–24 years old) are among the most affected, and suicide is the biggest killer of young Australians, even before car accidents.

But, when it comes to treatment for mental illness, the public system is overstretched. Comprehensive private health cover for mental health is normally only offered by expensive top cover policies.

For the best top-level policies covering psychiatry, see the CHOICE health insurance comparison.

Cover upgrade options

A centrepiece of the health insurance reforms is better access to mental health services:

  • You can upgrade your cover to a policy that covers mental illness without a waiting period once in your lifetime (you need to already hold health insurance for at least two months).
  • You can even upgrade when you’ve already been admitted to hospital – if you upgrade within five business days after entering hospital, you'll then be covered for your full hospital stay.
  • Limits on the number of specific treatments, such as day programs or electroconvulsive therapy (a treatment for severe depression) were abolished. 

While we welcome these changes, they may not solve all the problems with Australia’s health and mental health system.

“The reforms are an important step forward but only time will tell how practical it is to upgrade your cover when you most need it,” says Katinka Day, CHOICE Campaigns and policy team lead. “The reforms also don’t address the problem of ongoing high costs for top cover policies which may be hard for people to afford when they are suffering from mental illness.”

If you think you need cover for mental health, it’s a good idea to upgrade as soon as you can as it is not always practical to only upgrade once admitted to hospital. Also it can take some time to find the right policy, as you’ll want to make sure it covers all of your needs.

“We have some concerns that five days may not be enough time to make arrangements from the date of admission,” says Dr Kym Jenkins, President of the Royal Australian and New Zealand College of Psychiatrists.  “Also, if a patient is not able to make the request, a family member or carer should be able to advocate on their behalf.”

Private hospitals may ask for payment in advance which could be a financial burden. Also, it could be complex to find the right policy to upgrade to and may mean switching health funds if your health insurer does not offer a suitable policy or does not have an agreement with the hospital you’re admitted to.

Mental health cover checklist

If this cover is important to you, ask:

  • does this policy cover in-patient psychiatric care in a public and private hospital? Is there an annual maximum number of admissions or days covered in hospital? And does it cover re-admission to hospital within days of a previous hospital stay?
  • does it cover day programs in private hospital? Is there any limitiation on how many hours per visit are covered?
  • how about outreach nursing? Is day program and outreach nursing covered at the same time?
  • is there cover for specific treatments, such as electroconvulsive therapy, to treat severe depression?
  • does it cover all public and private hospitals or only a selection? Different private hospitals specialise in the treatment of different mental health conditions, and you want to be able to access the best one for your needs.

Also check on potential out-of-pocket expenses. For example, health insurance fund Medibank has stopped full cover for pathology provided in hospital.

Next to hospital policies, some extras cover policies will also provide cover for counselling or pay part of the costs to visit a psychologist. To find which extras policies we recommend for your needs, use our health insurance comparison.

If you have a complaint about your health fund, contact the Private Health Insurance Ombudsman on 1300 362 072.

For immediate assistance, contact 24/7:


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