Public and private: what’s the difference?

A private patient is someone who is liable for their treatment costs either through their insurer or paying themselves.

A public patient is someone who goes to a public hospital and relies on Medicare to fund their treatment.

It sounds simple enough, but as is usually the case, the devil is in the detail. Your choice – public patient or private patient – will shape your hospital experience.

In this blog, we look at the pros and cons of being a private patient in a private hospital; a private patient in a public hospital; and finally, a public patient in a public hospital to help you make an informed decision.

Pros of being a private patient in a private hospital

Avoid public hospital waiting lists: As a private patient in a private hospital, you can avoid the public hospital waiting list and choose when you get treatment. This is particularly handy if you have an upcoming holiday to plan around, or if you need to get back to work quickly.

Choice of doctors and specialists: Choose your doctors and your specialist for a more personalised approach to your care.

Private room availability: If covered by your hospital insurance and there’s one available, you can enjoy the comfort of a private room, offering more privacy and potentially better amenities (private bathroom).

Cons of being a private patient in a private hospital

Out-of-pocket costs: When you go private, there can sometimes be gaps you need to pay out of your own pocket. These can be things like any excess or co-payment you have on your hospital insurance, or if your doctor or specialist isn’t fully covered by your health fund.

Pros of being a private patient in a public hospital

Lower out-of-pocket costs: Private patients in public hospitals don’t often have gaps to pay. If there are any gaps, you’ll pay for these out of your own pocket, much like you would if you went to a private hospital.

Potential choice of doctors and specialists: You might have the opportunity to choose your doctors and specialists, though this is not always guaranteed.

Cons of being a private patient in a public hospital

Public hospital waiting lists: Even as a private patient, you’re still subject to public hospital waiting lists, which can delay the timing of your treatment. Availability of private rooms: While you may have cover for a private room, getting one is not guaranteed. It depends on availability and priority, with other patients possibly taking precedence.

Pros of being a public patient in a public hospital

Cost-free or heavily subsidised treatment: As a public patient, most of your treatment is covered by Medicare, meaning it will either be free or heavily subsidised. This applies even if you have hospital insurance that you choose not to use.

Cons of being a public patient in a public hospital

Limited choice of hospitals and specialists: You’ll usually be assigned to the public hospital closest to your home, and the hospital will choose your doctors and specialists. If your local hospital can’t provide the required treatment, you’ll be referred to another hospital that can.

Waiting lists for elective surgery: For elective procedures, you’ll be placed on a waiting list. The timing of your treatment is uncertain and depends on when a spot becomes available. Waiting times can range from months to years and may vary depending on urgency and other patients' needs.

No choice in treatment timing: You have no control over when your treatment occurs; it’s scheduled based on availability and urgency.

Shared room accommodations: As a public patient, you typically won’t have the option of a private room. You’ll likely stay in a shared room unless isolation is necessary due to your condition.

What about a self-funded patient?

If you don’t have private hospital insurance, you can still choose to go to a private hospital for treatment. If you go down this road, you’re considered a self-funded patient.

Medicare doesn’t cover private hospital costs (for example, theatre fees or accommodation), so if you receive private hospital treatment without hospital insurance, you’ll need to pay for everything out of your own pocket.

Is private health insurance right for me?

Deciding whether private health insurance is right for you is a personal choice and depends on your individual needs and preferences. In Australia, Medicare provides a strong safety net, ensuring that essential medical treatment is available without direct costs.

However, if you prefer to avoid public hospital waiting lists, have the ability to choose your doctors and specialists, and enjoy the possibility of a private room (subject to availability), private health insurance might be a worthwhile investment.

It’s important to remember that waiting periods apply for private health insurance. A waiting period is a period of time during which you must hold continuous membership under a particular health cover before you are entitled to receive a benefit at the level payable on that cover. This helps stop people from signing up for health cover, claiming and leaving soon after, which drives up premiums for all other members of the health fund.