Medical costs comparison

How out of pocket medical costs work in Australia

If you have Medicare, you have 2 options for receiving hospital treatment: public or private. In the public system, Medicare will generally pay all of your costs.

If you choose private hospital care, your costs can be covered in a few ways. Medicare will still pay some, but a private health fund can also cover some of your fees. If you don't have private health cover, then you'd need to pay for the entire private procedure. If you do have private hospital cover for your treatment, then there may still be out of pocket costs.

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Compare medical costs across Australia

The table below compares some costs of common medical procedures in 5 different states. The data comes from Medical Costs Finder, a tool managed by the Department of Health and Aged Care. The data was last updated on 29 September 2023.

• Typical specialists’ fees refers to the cost of specialists, assistant surgeons, and anaesthetists. It doesn't include hosptial fees, which are generally either mostly or fully covered by private health insurance funds.
• Patients typically paid refers to the the median amount paid by the typical patient, after Medicare and Private Health insurance benefits were paid.
• Patients typically paid refers to the the median amount paid by the typical patient, after Medicare and Private Health insurance benefits were paid.
• % with no out-of-pocket costs refers to the proportion of partients that didn't have to pay any out of pocket costs.

• NSW
• VIC
• QLD
• SA
• WA

Frequently asked questions

• How do medical costs work?

  If you receive medical treatment in a hospital as a private patient, Medicare will pay 75% of the Medical Benefits Schedule (MBS) fee. The MBS fee is the amount the government defines as fair. The fee for each service differs and you can usually find it online if you get the MBS fee number from your doctor. If you have private health insurance, this will ordinarily cover the remaining 25%.

  However, you still might have out-of-pocket expenses, also known as the gap. This is when the doctor treating you charges more than the MBS fee. Medical professionals in Australia are under no obligation to adhere to the MBS fee, meaning you still might have out-of-pocket expenses even if you have private health insurance.

  For specific services, such as weight loss surgery or treatment for your tonsils or your kidneys, it's often the case that the recommended MBS fee is far less than what most doctors charge, meaning you're more likely to have out-of-pocket expenses. For example, an ankle replacement in NSW has typical specialists' fees of $4,900, but Medicare typically pays just $1,700.

• What factors impact medical costs?

  Ever wonder why medical costs can differ so much. Here are some of the main reasons:

  • Location. Doctors charge differently depending on the area. Sometimes, this has a lot to do with patient load. Other times, it might be because you live in an expensive city like Sydney or in a rural area.
  • Procedures. Some procedures cost more than others, partly due to their complexity and the technology involved.
  • Skill shortages. If there aren't as many doctors who specialise in a specific field, you might have to pay more for treatment.
  • Quality of service. Australia attracts some of the best medical professionals in the world. As a result, some doctors and medical specialists charge considerably more than others – and more than the MBS fee – because they claim to offer better services than others. This may well be the case and some people are happy to pay more for their treatment.
  • A lack of accountability. The fact is, private health care is a business built upon profits. If doctors can charge more, many probably will since there's no obligation to adhere to the MBS fee.
  • Efficiency. In principle, you pay for what you get. Private health care generally has shorter waiting times when compared to public care.

• How to compare medical costs if you need treatment?

  There are a number of things you can do to figure out if you will have out-of-pocket expenses.

  • Call around to different doctors to get a few different quotes. This ensures you don't just go with the first person and potentially pay much more than if you went elsewhere.
  • Get a Medicare MBS code. This is so you know how much Medicare and private health insurance will cover. Get this code from your doctor and give it to your private healthcare provider.
  • Look on the Medical Costs Finder to see how much you are likely to pay. Alternatively, look at the table above for a breakdown of the costs for services by state. This shows what the average out-of-pocket expenses are, which you can then compare with the quotes you have received.
  • Find out if your surgeon is in your private health insurer's preferred list. Sometimes, your health provider will only cover certain doctors, so be sure to confirm this with your insurer beforehand.

Written by

Tim Bennett

Insurance expert

A seasoned journalist with over 10 years of experience in news, politics and finance reporting, Tim has previously held roles at the ABC, SBS and Fairfax Media. Tim’s expert insights have been quoted in The Australian, The Daily Telegraph, The Courier Mail and more. He regularly appears on TV and radio, and has been interviewed on 7 News, Sunrise, SBS News, ABC Local, 3AW and 5AA. Tim is passionate about simplifying complex insurance topics for Australian consumers. He holds a Bachelor of Arts (Politics) from Macquarie University and a Tier 1 General Insurance (General Advice) certification, which meets the requirements of ASIC Regulatory Guide 146 (RG146). If you’re interested in a media interview with Tim, please reach out to our PR team at aupr@finder.com. See full bio

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Gary Ross Hunter has over 6 years of expertise writing about insurance, including life, health, home, and car insurance. Having reviewed hundreds of product disclosure statements and published over 800 articles, he loves simplifying complex insurance topics for everyday readers. Gary has contributed to major outlets like Yahoo Finance, The Sydney Morning Herald, and news.com.au, and holds a Bachelor of Arts (Honours) in English Literature from the University of Glasgow, along with a Tier 2 General Advice certification, ensuring his work adheres to ASIC’s RG146 standards. See full bio

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