Medicare is Australia’s universal health insurance scheme. It guarantees all Australians (and some overseas visitors) access to a wide range of health and hospital services at low or no cost.
Medicare commenced in 1984 to help Australians with the costs of their health care, regardless of where people live or their ability to pay. It has since grown to cover a broad range of health services.
The Medicare Benefits Schedule (MBS) describes the medical services, hospital services, tests, imaging and scans subsidised by Medicare.
Medicare benefits are payable only for services that are listed on the MBS. A medical service is a clinically relevant service if it is accepted by the medical profession as necessary for the appropriate treatment of the patient. The extent to which the Medicare subsidy covers the cost of a Medicare service depends on factors such as whether the service is in hospital or outside of hospital (determining which Medicare benefit rate is applicable), and how much the health practitioner charges.
Health practitioners have the option to either bulk bill or to charge a patient for the cost of the service. Bulk billing means a patient does not have to pay for the service. Instead, a health practitioner accepts the Medicare benefit as the full payment for the service. Under this arrangement, the patient assigns their entitlement to a benefit to the health practitioner, and the health practitioner cannot charge the patient any additional fee.
Alternatively, a health practitioner may charge the patient a fee for the service. In this instance, the patient either pays the full cost or the difference between what the charge is and what Medicare covers. If the patient pays the full cost, they can then make a claim for a Medicare benefit.
If you are a public patient in hospital, Medicare covers all your medical expenses. However, if you are a private patient in a public hospital, Medicare only subsidises the doctor fees paid by the patient and the patient pays for hospital accommodation, theatre fees and doctors’ fees.
Private health insurance may cover some or all of the costs of private treatments in hospital that Medicare does not cover, depending on the hospital cover an individual takes out, however it does not cover Medicare services outside of hospital.
Families, couples, and individuals who face high out-of-pocket medical costs for services delivered outside of hospital can access Medicare safety nets. Once the out-of-pocket costs reach a threshold amount, Medicare pays extra benefits for the remainder of the calendar year. Individuals enrolled in Medicare are automatically registered for the safety nets, but families and couples are required to register separately to be eligible.
Responsibility for managing Medicare lies with the Department of Health and Aged Care. Services Australia is responsible for the day-to-day administration and the payment of benefits under Medicare.
The Department of Health and Aged Care advises the Australian Government about new services to be funded through Medicare, as well as proposed amendments to existing services, following provision of advice from the Medical Services Advisory Committee (MSAC).
The Medical Services Advisory Committee (MSAC) provides independent advice to the Minister on the strength of evidence relating to the safety, clinical efficacy and cost effectiveness of new and emerging medical services and technologies and under what circumstances public funding, including Medicare funding should be supported.
For more information about Medicare, including what is and is not covered and safety nets, go to the Department of Health and Aged Care website. For information about enrolling in Medicare or claiming a benefit, go to Services Australia website.
