Medicare is Australia’s universal tax-funded healthcare system, created in 1984. It aims to provide access to adequate healthcare at little or no cost to all Australians in need of treatment, regardless of their age or income.
Medicare is funded through taxation:
The government pays for all or most of the services used (if they are covered services).
Some services are bulk billed, so the customer pays nothing and the government is billed directly by the service cost. Otherwise, the customer pays for the service and then lodges a claim with medicare to receive money back for the service.
When the government does not pay for all of the fee charged by a health service, the additional money is regarded as an out-of-pocket expense, as this is how much the patient pays for directly.
Once a certain amount of out-of-pocket expenses have been incurred in one year, individuals or families can receive additional assistance with their health service payment.
The PBS is basically Medicare for medicines – the government subsidises essential medicines to make them more affordable. It’s a Federal Government scheme that subsidises the cost of a wide range of prescription medicines, providing all Australians with access to vital and cost-effective medicines at an affordable price.
Private health insurance is where individuals or families choose to pay a premium to an insurance fund, which offers financial benefits for additional healthcare services that aren’t covered by Medicare, depending on the type of insurance you buy and how much you’re willing to pay. It also gives people the opportunity to be treated in a private hospital by the doctor of their choice.
The government wants high income earners to take out private health insurance to help reduce the burden on the public Medicare system, which lower income earners need to be able to access. So, the government has introduced some incentives to take out PHI cover:
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