Medicare

Medicare is Australia’s healthcare insurance scheme, backed by the government. All citizens and permanent residents (and some temporary residents like New Zealanders who live in Australia) get access to health services for free or very low costs (eg. visits to a general practitioner, medically necessary surgeries, prescription drugs, etc.).

Medicare is funded through the Medicare levy and Medicare levy surcharge (MLS).

If you owe $Xforsomesortofcare/treatment,thenthepublichealthproviderwil{l}^{\prime }bulkbil{l}^{\prime }Medicare,lettingyouwalkwithnoout-of-pocketcosts,orasmall\ast gappayment\ast withMedicarepromisingtothehealthcareprovidertopaytheotherlargefractionof$X.

• When you make an appointment, ask whether they bulk bill.

Medicare Levy

The levy is in addition to your regular income tax and is collected the same way. Everyone must pay the levy unless they meet some exceptional criteria. If you pay the Medicare Levy (which you almost certainly will), there is another separate payment called the Medicare levy surcharge that you probably have to pay as well.

As of 2023, the Medicare levy is 2% of your taxable income. This amount is likely already withheld by your employer.

Medicare Levy Surcharge

As of 2023, the Medicare levy surcharge (MLS) is something you pay if you don’t have appropriate private health cover and you earn more than $90000 per year. It’s about 1-1.5% of your taxable income.

You are exempt from MLS if you earn less than $90000 per year.

Why does MLS exist? It exists to encourage individuals to take private hospital insurance. This reduces demand on the public healthcare system.

Medicare vs. Private Health Insurance

See Private Health Insurance. Health insurance doesn’t replace Medicare, it’s something you get in addition to it for more complete healthcare coverage.

• Medicare doesn’t cover most of the following (whereas private health insurance might):
  • Dental care.
  • Physiotherapy.
  • Chiropractor care.
  • Optometry.
  • ‘Elective surgeries’, which are non-essential surgeries.
• Screening services like MRI, PET, CT, x-ray scans, etc. are all typically covered.
• Pathology tests (against blood, urine, tissue) are covered.
• Wait times are often very long if you’re opting for pubic healthcare. With private healthcare, you can select doctors and access treatment much quicker in general.

Separate to Medicare is the Pharmaceutical Benefits Scheme (PBS), which greatly subsidises the cost of medicine for anyone covered by Medicare.