What is Excess in health insurance?

You have the option to add an excess to any medical insurance policy you choose. However, you must be able to cover the pocket expense if you need to make a claim.

The cost of the hospital treatment you receive under your private health insurance policy will be split between you and your insurer, with whom you will pay your excess, plus anything exceeding the cover limit of your health policy.

You may be required to pay a health insurance excess on every claim you make or only on the first claim in each policy year. You can find this information under the terms and conditions of your policy.

How Is Health Insurance Excess Paid When You Need Hospital Care?

Understand better how a health insurance excess work by learning the payment procedure when you need the services of health professionals and private hospitals. Every health insurance provider has a different process, but most of them follow these steps:

Step 1: Inform Your Health Insurer

When your medical specialist prescribes medical treatment, and you decide to push through with it in a private hospital, you need to call or visit your insurance provider. They would provide you with an authorisation number or code. Often, designated hospital staff will contact the company on your behalf, especially for the unplanned hospital admission.

Most insurers have payment rules wherein you must pay the excess upfront before admission and hospital treatment. It is usually the case if you have a traditional excess cover type, as the specific amount is already known.

Step 2: Proceed to the Hospital

With your insurer’s authorisation, make arrangements with specialists and any private hospital accepting payment from your specific insurer. Once you’re in the hospital, the staff will take it from there and provide you with instructions. Then, proceed with your consultation and medical treatment with your choice of specialist.

Step 3: Billing

After providing you with the health services you require, you’ll receive a bill once you’re ready to go home as per your choice of specialist’s advice. It includes the total amount and the analysis of hospital costs. In other words, you’ll find a detailed and clear list of tests, procedures, medical specialist professional fees, and other range of services provided that your insurance policy covers and does not cover.

Step 4: Pay

Review your bill to see any discrepancies, and pay the out-of-pocket hospital expenses (actual hospital costs not covered by your insurance). Remember that you would need to pay the total amount if it’s less than or equivalent to your insurance excess. Otherwise, your insurer will take care of the remaining medical costs.

Step 5: Inform Your Insurer

Communication with your private healthcare insurance provider is essential even after your treatment. Some conditions will need repeated hospital care, ongoing treatment, and the expertise of health professionals within one calendar year. Thus, when you’ve reached the maximum annual limit of your excess, your insurer will take sole responsibility for paying the health care costs.

Of course, this still depends on your policy’s level of cover, so you might still have out-of-pocket hospital expenses. That’s because you would need to pay a portion of the medical costs.