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How to avoid health care out-of-pocket costs

Tips on how to get cheaper health care and negotiating with your surgeon.

surgeon consulting with patient
Last updated: 23 August 2018


Checked for accuracy by our qualified fact-checkers and verifiers. Find out more about fact-checking at CHOICE.

Need to know

  • Where you live may affect how much you're out-of-pocket for doctor and medical services
  • Specialists are more likely to charge on top of what Medicare covers than GPs and other medical services
  • There are ways to minimise your out-of-pocket healthcare costs

Australians in high socioeconomic areas are more likely to be out-of-pocket than others after visiting their GP or getting a blood test, according to a new report by the Australian Institute for Health and Welfare.

And specialists hit you hardest with out-of-pocket costs compared to other medical services you might access outside of hospital.

So how much extra do we pay for medical services outside of hospital?

The report found that Australians were out of pocket by $3 billion in 2016–2017 for doctors' visits, blood tests and other services provided outside hospitals that are covered by Medicare. In other words, doctors and medical service providers charged $3 billion above what Medicare agrees to cover for those services. 

But not all of us are out of pocket – this sum was borne by half the people who used the services, while half were bulk-billed.

How can you avoid being out of pocket for health care?

Outside of hospital

Having private health insurance doesn't help when you visit a GP or specialist outside of a hospital, as their fees can't be claimed through private health cover.

Finding a doctor that charges the same as, or close to, the Medicare Benefits Schedule (MBS) fee is your best bet to reduce the expense to you.

  • Medicare will pay 100% of the Medicare Benefits Schedule (MBS) fee if you visit a GP and 85% of the MBS fee if you visit a specialist. See Medicare 101.
  • If your doctor bills Medicare directly (bulk billing), you won't have to pay anything. 

When it comes to visiting a specialist, it pays to shop around – and even be prepared to travel. The Australian Institute for Health and Welfare report says:

  • seven in ten patients visiting a specialist paid extra, with a median cost of $64 per service
  • there are large variations of costs between patients living in different geographical and socioeconomic areas 
  • patients living in a higher socioeconomic area in one of the major cities faced the highest charges. 

The report can even tell you which suburbs and towns in Australia have the highest, and lowest, out of pocket costs – so you can travel if you think it's worth it.

At the hospital

If you need to visit hospital and you have private health insurance, your fund will offer some protection from out-of-pocket costs in a private hospital. But some health funds are much better at protecting you from extra charges than others.

And if you do need to have surgery, whether you go public or private, it is possible to find out how much extra you'll have to pay on top of your Medicare (and health insurance benefit), and use that information to negotiate with your doctor or shop around to get a better deal for surgery. See our handy guide below.

How to save on surgeons' fees

You may be more than a little surprised to learn that using your private health insurance can expose you to thousands of dollars of out-of-pocket costs, while public patients enjoy the same treatments for free.

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