How does the healthcare system work?

Australia's healthcare system is made up of both government and private organisations. The federal government pays for the cost of healthcare under the Medicare system. It also pays extra healthcare benefits to veterans and people on low incomes. If you are new to Australia, you can check with Services Australia to see if you are eligible for Medicare or other benefits.

Australians are also encouraged to buy private health insurance, although it is not compulsory. There are many different types of private health insurance policies.

What does Medicare cover?

Everyone in Australia with a Medicare number is entitled to:

• free treatment as a public patient in a public hospital, paid for by Medicare
• doctor visits and medical tests partly or fully paid for by Medicare
• a reduced cost for many prescription medicines, subsidised by the Pharmaceutical Benefits Scheme (PBS)

If you have a chronic health condition or a mental health disorder, you may be eligible for some allied health services that are partly or fully paid by Medicare. Speak to your doctor to see if this applies to you.

If you need an ambulance, it will not be covered by Medicare. In some states, the state government pays for ambulance services. In other states you can pay privately for ambulance cover.

What does private health insurance cover?

There are 2 types of private health insurance:

• Hospital insurance — this is for treatment in a public or private hospital.
• General treatment (also called ancillary or extras) insurance — this is for treatment outside hospital, which is not covered by Medicare, such as dental or allied health services.

If you need to go to hospital, most private hospital insurance policies let you choose your doctor or specialist and receive treatment as a private patient in a private or public hospital. Around 2 in every 5 hospitalisations in Australia are in a private hospital. Depending on your policy, there may be hospital costs that your private insurance doesn’t cover. You may also need to pay an amount (called an excess) towards your hospital costs. Health funds require a waiting period before you’re covered by your policy. Check with your fund which costs you’re covered for before you choose care in a private hospital.

If you have private health insurance, you are still entitled to free care in a public hospital.

Why should I choose a private hospital?

If you choose treatment in a private hospital, you will have more options. For example, you can choose your own doctor. Some doctors may work only in a private hospital. Waiting times for elective (planned) surgery are usually shorter in a private hospital. You can choose when you want to have elective surgery. You may get extra services like your own room and a more pleasant environment.

Why should I choose a public hospital?

Australia’s public hospitals provide high quality medical care and are free of charge for anyone with a Medicare number. They tend to be more widely accessible, especially in rural areas and offer more services than private hospitals. Public hospitals may have better medical facilities for your condition than private hospitals and are usually equipped to handle more complex cases.

For these reasons, public hospitals are usually the first choice for emergencies or acute health issues. The majority of emergency department and outpatient services in Australia are provided by public hospitals.

What does it mean to be a private patient in a public hospital?

If you choose to be treated as a private patient in a public hospital, you will receive treatment from your own doctor, you will be given a single room if one is available, and you may be transferred to a private hospital for follow-up care. You will likely keep seeing the same doctor later in their private rooms.

How do I decide?

Deciding whether to go to a public or private hospital can be confusing, especially when you are unwell. You might have previous experience in a public or private hospital, or you can take advice from friends, family, or your doctor when choosing a hospital. Your choice will also depend on your health condition, where you live and whether you want to choose your doctor.

It is important to consider what your private health fund will cover, if you have one. Ask your insurer out about any out-of-pocket costs, waiting periods, and what facilities are available. You can learn more about private health insurance at the Private Health Insurance Ombudsman website.

If you are deciding between public and private care for pregnancy and birth, you can find more information here.