Media releases

March 25, 2007

457 visa sponsors risk financial health

Medibank Private is alerting employers to beware of potentially exorbitant medical costs for uninsured employees on 457 working visas, following the announcement of a streamlined application process last week.

It is believed thousands of 457 visa holders are uninsured, despite immigration regulations specifying that sponsoring employers are responsible for the cost of medical treatment and repatriation (if required) for the visa holder and any dependents.

According to Medibank Private Industry Affairs Manager, Craig Bosworth, even the simplest of medical treatments can end up costing the employer thousands of dollars if sponsored workers and their families are uninsured.

"When international visitors go to a public hospital in Australia the costs, which the employer is responsible for paying, are not capped as they are for patients under the Medicare system. Hospitals can charge whatever they want as there is no schedule of fees for treatment of non-residents.

"Employers don't have to be in a high risk industry to be affected. As an example, if an employee's son or daughter falls off their bike and breaks a leg the sponsoring company could be up for anything in excess of $10,000. In most cases we're not talking about major health issues or pre-existing conditions here. We're talking about injuries and hospitalisation as a result of everyday accidents and common health complaints.

"We recently paid a claim of over $23,000 for a 457 visa holder. Employers need to ask themselves if this is a cost their business can afford.

"In contrast, private health insurance for a single employee is around $2,000 per year. This gives you comprehensive cover that eliminates risk for employers. Taking out health insurance for your employee, or including health insurance as a condition of contract means there will be no out of pocket expenses in the case of an accident or illness."

A recent Australian Government survey found that 457 visa holders have a high propensity to visit hospitals for their health needs, with about 60 per cent reporting use of such services. Medibank Private's data shows that on average a hospital visit costs over $2000 in hospital fees alone.
There are currently over 100,000 workers on 457 visas across Australia, based mainly in News South Wales and Victoria.

With the number of working visa's issued growing in-line with the ongoing skills shortage in Australia, the Australian Government last week announced plans to streamline the application process. Medibank have specifically designed Working Visa Health Insurance to suit the needs of employers and employees.

Ends

For further information please contact:
James Connors
Tel: 03 8622 5163 | Mob: 0433 992 677 | email: james_connors@medibank.com.au


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