01/08/2022
Very informative post for those interested in reading about out of pocket costs for Medicare based healthcare. Particularly interesting if you have a family / multiple people on one Medicare card.
Of course a lot of people are interested in bulk billing of GP's or lack thereof. This explains a bit of that topic (it's a finding conversation), but mostly how you can best have the system work for you. :)
Many of you would be aware that many GPs have moved away from the bulk-billing model due to the rising costs of running a small business. With more GPs implementing a mixed-billing or private billing model to remain sustainable, for the first time many patients are now experiencing out of pocket costs when they see a doctor.
I have previously spoken about how the freeze on Medicare rebates, over successive governments, has resulted in a ballooning deficit when it comes to the costs of providing medical services. While many patients may be dismayed at having to pay to see a doctor they previously saw ‘for free’, tonight I wanted to discuss a Medicare initiative that can help lessen the cost of medical care for those who have large families, are concession card holders, receive Family Tax Benefit A, or who have frequent medical appointments.
Many patients are unaware about the existence of the Medicare Safety Net. Many more may have heard of it, but are unaware that they need to register for it with Services Australia.
So, what is it?
The Medicare Safety Net is available to everyone who is registered with Medicare. For simplicity’s sake, I will discuss the Extended Medicare Safety Net, because this is the program that can have a big impact on saving money when you see doctors for out of hospital services.
So, how does it work?
Medicare will normally pay you a rebate for the medical services that you have accessed through them. Bulk billing doctors would ordinarily accept that rebate alone as sufficient payment for their services without charging you anything out of pocket. But with bulk billing on the decline, your doctor is charging you a fee for their services because the rebate in insufficient to remain viable. This results in you being out of pocket a certain amount. In GP land, this out of pocket payment will vary depending on the time spent with the doctor, and the indication for the appointment.
However most people don’t recognise that when you have paid a certain amount in out of pocket payments for medical services, Medicare’s Extended Safety Net kicks in. This means that Medicare will now pay 80% of the out of pocket costs, slashing the amount you are paying.
To illustrate, Jane goes to her GP every few weeks for management of several chronic health concerns. Each appointment costs her $85 (the recommended AMA rate) but the Medicare rebate only covers $39.7 of this. She is hence $45.3 out of pocket for her consultations.
However, once Jane has reached the Extended Medicare Safety Net threshold, Medicare will cover 80% of her out of pocket costs for seeing her doctor. She is hence $9.06 out of pocket for her consultations for the remainder of the calendar year.
So what is the threshold?
If you are an individual with no concession card then the threshold is reached when you have paid a total of $2249.80 in out of pocket services.
However, if you are a family with no concession card, then the threshold is reached when the entire family have paid a total of $2249.80 in out of pocket services.
But what people don’t realise is that having your children and spouse listed on your Medicare Card doesn’t automatically register you as a family for safety net purposes 🤯 You MUST fill out a form available on the Medicare Express app or the Services Australia website, explicitly stating that your spouse and dependents are one family unit, otherwise Medicare will consider you as seperate independents with a Safety Net threshold of $2249.80 each, instead of $2249.80 cumulatively.
So let’s get back to the example of Jane.
Jane is seeing her doctor every few weeks for her chronic medical needs, paying $45.3 out of pocket for her appointments. Her 18 year old daughter, Melanie, has been seeing a gastroenterologist monthly for her Crohn’s disease, paying $200 out of pocket for each appointment. Her 21 year old son, Paul, has been seeing a sports physician every fortnight for an acute and serious knee injury sustained playing soccer, and he has been paying $200 out of pocket for his consultations.
But because Jane registered her two dependents Melanie and Paul as her ‘family’ with Medicare, once they have collectively paid $2249.8 in out of pocket costs, the extended safety net kicks in. Jane now is $9.06 out of pocket for her GP visits, Melanie is $40 out of pocket for her gastroenterologist appointments, and Paul is $40 out of pocket for his sports physician appointments.
But there is more.
Because if the family is a concessional family, where two of the people in the registered Medicare Safety Net family have an eligible concession card, OR the families are eligible for Family Tax Benefit Part A, the safety net threshold is much, much lower: $717.90!
Continuing Jane’s example: Jane’s and Melanie’s chronic medical conditions mean that they are both on Disability Support Pensions. As a result of this, the family’s Safety Net Threshold is now $717.90. Once the family have collectively paid this amount in out of pocket fees, Medicare will cover 80% of their out of pocket medical expenses.
So, what services counts towards the safety net?
Out of hospital services with your GP and other medical specialists will count, as will radiology and pathology services.
But what many people don’t realise is that services like psychology also count! Anyone with a mental health care plan knows how cost prohibitive regular psychology sessions can be, but the Medicare Safety Net will slash the out of pocket costs associated with it.
But remember: anyone who is part of your family MUST register with Medicare as a family for Safety Net purposes. It is not automatic and it doesn’t matter if you are all listed on the same card. Go to the Medicare Express app or Services Australia website to do so.
I hope that the above information provides some relief to families that are experiencing hardship during these trying times.
- Sara
