Understanding Medicare Benefits and the Medicare Safety Net

Medicare in Australia
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What are Medicare benefits?

Medicare benefits in Australia provide financial assistance via rebates for a wide range of health care services and treatments. It helps Australians access affordable healthcare by covering or subsidizing the costs of various medical services.

To access Medicare benefits, you need to have a valid Medicare card and meet the eligibility criteria for the specific service or treatment. You can claim Medicare benefits by presenting your card at the time of service or by submitting a claim afterwards.

You can find more information about Medicare benefits on the Services Australia website.

These rates are indexed annually- new rates and changes to the Medicare Benefits Schedule effective from 1st July 2024. 

At BodyMatters, all of our clinicians- Doctors, Psychologists and Dietitians- provide services via the Medicare scheme (except for Provisional Psychologists- a fee adjustment has taken place to reduce the out-of-pocket cost clients would otherwise experience for these consultations). 


What is the Medicare Safety Net?

The Medicare Safety Net is a program in Australia designed to help reduce  high out-of-pocket costs for medical and allied health services. It provides additional financial support once you’ve spent a certain amount on eligible services within a calendar year.

There are two levels of Medicare Safety Nets, the Original Medicare Safety Net (OMSN) and Extended Medicare Safety Net (EMSN). The thresholds and benefits for each are explained below. 

Threshold and benefits of Medicare in Australia

It’s important to note that the Medicare Safety Nets are calculated on a calendar year basis (1 January to 31 December) and reset on 1 January each year.


What do the fee types refer to?

The Medicare Benefits Schedule (MBS) references various types of fees: http://www.mbsonline.gov.au/

  1. Scheduled fee: This is the amount set by the Australian Government for a specific medical service and listed on the Medicare Benefits Schedule (MBS). It’s the maximum amount Medicare will contribute towards the cost of the service. This is the set amount the Australian Government determines for each medical service covered by Medicare. Think of it as the “official price” of the service. 
  2. Benefit fee: This is the amount Medicare usually reimburses you for a service. It’s typically a percentage of the scheduled fee (often 85%). Example: If the scheduled fee is $100, the benefit fee might be $85.
  3. Practice charge: This is the amount the healthcare provider (doctor, specialist, etc.) charges for the service. It can be equal to, less than, or more than the scheduled fee.
  4. Gap fee: This is the difference between the practice charge and the Medicare benefit.

If the practice charges the scheduled fee: The gap fee is the difference between the scheduled fee and the Medicare benefit (usually 85% of the scheduled fee).

If the practice charges less than the scheduled fee: There is no gap fee, and you only pay the practice charge.

If the practice charges more than the scheduled fee: The gap fee is the difference between the practice charge and the Medicare benefit, meaning you pay the Medicare benefit plus the full gap amount.

Please note that when you reach the Medicare Safety Net thresholds, you may still have out-of-pocket costs if the practice charges more than the scheduled fee. The Safety Nets only cover the scheduled fee amount. For services not covered by Medicare and therefore not subject to the Medicare Safety Net.


How the Safety Nets impact these fees:

The Medicare Safety Net reduces your out-of-pocket expenses in two ways, once you have reached the aforementioned thresholds…

  1. Original Medicare Safety Net (OMSN): Once your gap payments (difference between scheduled fee and benefit fee) reach a certain threshold, Medicare boosts your benefit fee to 100% of the scheduled fee for the rest of the year. This means no more gap to pay for out-of-hospital services.
  2. Extended Medicare Safety Net (EMSN): This kicks in after you reach the specified higher threshold. It doesn’t change the benefit fee percentage but offers additional financial assistance by reimbursing a portion of your out-of-pocket costs (which can include the gap and other expenses).

If you have any questions, we recommend you contact Medicare directly.

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