What does Medicare cover?

Medicare is Australia’s public health system. It provides Australian citizens, permanent residents and visitors from the Reciprocal Health Care Agreement (RHCA) countries with free essential health care in public hospitals. It also subsidises GP visits and essential medications through the Pharmaceutical Benefits Scheme (PBS).

This guide looks at what is covered by Medicare, what isn’t covered and how the private health system plays a necessary role by filling in the gaps to provide Australians with comprehensive medical cover.

What’s the difference between Medicare and private health insurance?

While Medicare covers hospital treatment as a public patient in a public hospital, private health insurance provides additional options such as:

• Treatment as a private patient in a public hospital. Medicare pays 75% of the Medical Benefits Scheme (MBS) costs and private health insurance pays the remaining 25%.
• Treatment as a private patient in a private hospital. Private health insurance covers some or all of the costs for accommodation, theatre fees and specialist fees.

Advantages of private health cover over the public health system include the choice of your own treating doctor and eligibility for a shared or private room. Another advantage is shorter waiting times for elective (non-essential) surgery. While you can wait many months (sometimes years) in the public system for a procedure such as hip surgery, wait times are usually much shorter for private health fund members.

The other main advantage of private health insurance is extras cover for ancillary services such as optical, dental and physiotherapy, none of which are covered by Medicare.

Because Medicare covers some out-of-hospital services not covered by private health insurance, such as GP visits and PBS pharmaceuticals, it can be a real advantage to have a combination of both public and private health cover.

Still not sure if Medicare is enough for you? You can check out this roundup of some key Medicare facts every Aussie needs to know.

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What can you claim on Medicare?

Here’s a more in-depth look at some of the treatments covered by Medicare. It should be noted that all treatments must be professionally prescribed by eligible, licensed practitioners and medically recognised as the correct option for that particular situation:

• Testing and diagnosis. This includes X-rays, MRIs and other diagnostic techniques where they are considered necessary (eg, an eye test to diagnose cataracts is considered necessary, while an eye test for a pilot’s licence is not).
• Anaesthesia. Local and general anaesthetics and anaesthetist consultations if required, along with more complex anaesthesia needs, such as for more complicated surgeries or health issues like drug allergies and heart disease.
• Surgery. Operating theatre fees in public hospitals, required surgical consultations and surgery as a treatment if required (eg, surgery to remove a tumour is required, whereas elective cosmetic surgery is not).
• Some Dental. Under very few circumstances, Medicare will cover dental treatment. This includes emergency room visits where you're treated for pain, dental work that is necessary to continue with another Medicare-covered surgery and dental work for certain low-income children.
• Medication. Approved pharmaceuticals that have been prescribed by a licensed and approved practitioner and are covered by the PBS (a government scheme that subsidises the cost of many medicines dispensed by pharmacists)

What can you not claim on Medicare?

While Medicare covers a lot, there are a few things it won't cover and it's good to know what these are before going into treatment.

Here is what Medicare will not cover under most circumstances:

• Ambulance rides
• Overseas medical and hospital costs
• Medical treatments that aren't medically necessary, like facelifts
• Most dental treatments
• Most physio, acupuncture, and other natural therapy treatments
• Podiatry
• Glasses and contacts
• Most hearing aids and other appliances
• Home nursing

Are X-rays covered by Medicare?

Medicare covers the X-rays a doctor needs to help them diagnose or treat an illness, as long as it is considered medically necessary in a public hospital. This also includes other types of medical imaging techniques like CT Scans and MRIs. The amount Medicare will pay depends on where you are treated:

• In a public hospital. Medicare will pay 100% of the cost of your X-ray.
• In a private hospital. Medicare will pay 85% of the public rate and your private insurer will pay the additional 25%. If the cost is higher than the public rate, you will be responsible for the difference.
• In an outpatient setting. Medicare will pay 85% of the public rate and you will be responsible for the rest. Private health insurance doesn't usually cover outpatient services.

Just remember that Medicare doesn't cover most dental treatments and that includes X-rays related to dental work.

There are also situations where an X-ray isn't considered medically necessary. For example, Medicare no longer covers X-rays for lower back pain if a chiropractor is the one requesting it.

How much can I get back from Medicare?

The amount Medicare pays toward your treatment varies based on where you are being treated:

• If you are treated in a public hospital. Medicare will pay 100% of the cost for the treatment itself, the anesthesia, all diagnostic work like blood work and x-rays and all fees like theatre fees, accommodation fees and doctor's fees.
• If you are treated in a private hospital. Medicare will pay 75% of the public rate for the treatment, the anesthesia and all diagnostic work. You and your health insurer are responsible for the rest, including 100% of the cost of all fees like accommodation fees, doctor's fees and theatre fees.
• If you are treated in an outpatient clinic. This refers to diagnostic work like X-rays, ultrasounds and blood work. Medicare will pay 85% of the public rate and you will be responsible for the rest. Private health insurance usually doesn't cover outpatient services.
• If you see a GP. Medicare will pay 100% of the cost if the GP bulk bills. If they don't bulk bill, Medicare will pay 100% of the public rate and you will have to pay any extra if the doctor charges more.
• If you see a specialist. Medicare will pay 100% of the cost if the provider bulk bills. If they don't bulk bill, Medicare will pay 85% of the public rate and you will have to pay the additional 15% plus any extra if the doctor charges more.

Does Medicare cover surgery?

Yes. Medicare covers most medically necessary surgeries, and you can find a list of these on the Medicare Benefits Schedule (MBS). Since surgeries happen mainly in hospitals, Medicare will cover 100% of all costs related to the surgery if you have it done in a public hospital. This includes anesthesia, diagnostic work and all fees.

If you have it done in a private hospital, Medicare will chip in 75% of the public rate for the surgery, anesthesia and diagnostic work. You and your private health insurer will be responsible for the rest including 100% of the fees.

Can I make a specialist claim through Medicare?

Yes. Medicare will cover your specialist visits as long as a GP refers you and as long as it's a service listed on the MBS. This includes visits to dermatologists, psychiatrists, cardiologists and many others. If the specialist bulk bills, Medicare will cover 100% of the cost. If they don't bulk bill, Medicare will cover 85% of the public rate and you will be responsible for the additional 15% plus any private premium the specialist charges.

Does medicare reimburse anaesthetist fees?

Yes. Medicare will pay for any anaesthesia that is part of a Medicare-covered surgery or treatment. It will pay 100% of the anesthesia cost if the treatment is done in a public hospital leaving you with zero out-of-pocket expenses.

Medicare will split the bill with your private health insurer if the treatment is done in a private hospital - although there may also be a gap that you'll have to pay yourself.

Who is eligible for Medicare?

You are eligible for Medicare if you live in Australia or on an Australian dependency island such as Norfolk, Christmas and Lord Howe Island, though specific requirements and criteria apply. You must also be:

• An Australian citizen. If you were born in Australia.
• New Zealand citizen. You must have lived or intend to live in Australia for more than 6 months to be eligible.
• An Australian permanent resident. If you have applied for your PR, or are disputing your PR, you are eligible for Medicare.
• Reciprocal Health Care Agreement. You may also be entitled to a Medicare card if you're visiting from one of the 11 Reciprocal Health Care Agreement countries.
• Living Overseas. You can also get access to Medicare if you're an Australian citizen and you live overseas. However, if you've been living overseas for more than 5 years you will no longer have access to Medicare.

How to register for Medicare

If a treatment or service is covered by Medicare and your service provider doesn't bulk bill, you will need to pay upfront for your treatment and claim some or all of the cost back later (100% for GP visits and 85% for specialist visits).

By registering your bank account details with Medicare, you can streamline the process, as your benefits will be paid directly into your nominated bank account. You can register in several different ways:

• Through your Medicare online account at myGov
• With the Express Plus Medicare app
• By completing a bank account details collection form
• By calling the Medicare general inquiries line
• By registering in person at your local Medicare service centre

You will need to have your Medicare card and bank account details including BSB, account number and account name with you when you register.

How to claim Medicare benefits

The fastest and easiest way to claim your Medicare benefits is at the point of service (eg, your doctor or service provider). Many are now equipped with electronic Medicare claiming facilities, which allow them to lodge your claim and have your benefits paid directly into your bank account. If your GP does not offer electronic claiming, you will need to claim your benefits in one of the following ways:

• Using your Medicare online account through myGov (note that some types of consultations cannot be claimed online)
• Using your Express Plus Medicare mobile app
• Submitting a Medicare claim form by post, at your local service centre or at a participating private health insurer
• Submitting a claim over the phone by calling Medicare (be sure to have your details handy including your Medicare number, your bank account details and the service provider's receipt)

Can I get any special Medicare benefits?

There are other special Medicare benefits available for certain people in certain situations. These include:

• The Medicare Safety Net. This is available to all Australians with a Medicare card who exceed an annual threshold on the cost of their PBS pharmaceuticals. After the threshold is reached, you receive cheaper medicines for the remainder of the year. The threshold is considerably less for concession card holders.
• Dental benefits for children. Benefits for basic dental services for eligible children, which are capped at $1,000 per child over two consecutive years. Services covered include examinations, x-rays, cleaning, fissure sealing, fillings, root canals and extractions. No benefit is payable for orthodontic or cosmetic dental work or any services provided in a hospital.
• Pensioner medical equipment. Eligible pensioners can claim a payment towards the cost of eligible equipment such as home dialysis machines, home ventilators and respirators, oxygen concentrators, heart pumps, nebulisers, electric wheelchairs and insulin pumps.

Compare private health options in just a few clicks

Where Medicare can’t help you, health insurance could pick up the slack. Less waiting time, choice of doctor and help with dental. Use this free tool to see health insurance options across Australia.

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Richard Laycock

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Richard Laycock is Finder's insurance editor, and has spent the last five years wrangling insurance product disclosure statements. His musings about insurance have appeared on Money Mag, Yahoo Finance, and Travel Weekly. When he’s not helping people make sense of insurance fine print, he is testing the quality of cocktails in his newfound home of New York. Richard studied Media at Macquarie University and The Missouri School of Journalism and has a Tier 1 Certification in General Advice for Life Insurance.

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