Australia's Healthcare System

Australia has a fairly complex healthcare system, comprising both public and private hospitals, medical practitioners and many insurance schemes set up to fund the people. The state-run healthcare scheme is called Medicare, which was instituted in 1984 and is available to all citizens and permanent residents of Australia. This is an Australia-wide health insurance scheme, funded through income tax (1.5 %). An additional levy of 1% is imposed on high income citizens without private insurance.


In recent years the Australian Government has made changes to the tax structure in order to encourage people to take out private health insurance. Responsibilities for healthcare are divided between the federal and state governments, and both the public and the private sectors. Government pays about 70% of healthcare costs (about 47% from the federal and 23% from state governments); the remainder is then paid by non-government sources, eg. insurance and private pay. Private health receives a 30% subsidy from the federal government. Everyone is eligible for this subsidy and 45% of the population has private health insurance.


There is no limit on fees charged by doctors but there is a government-set fee schedule. Doctors can bill patients or send their bills directly to the government insurance authority, the Health Insurance Commission (HIC). If sent to the HIC, for out-of-hospital treatment, Medicare pays 100% of the MBS (Medicare Benefits Schedule Fee) fee for general practitioner consultations and 85% of the MBS fee for specialist consultations. For in-hospital treatment, Medicare pays 75% of the MBS Fee. If the patient has private patient hospital insurance, that must cover them for the remaining 25% of the MBS Fee. The money is then paid directly to the doctor, and the doctor is not allowed to charge the patient an additional fee. If the doctor charges above the MBS Fee, some or all of the remaining charge may be covered by the private health insurance. If a doctor bills the patient directly, the patient will then apply for the rebate of the government set fee.


The Australian Government and the state and territory governments have implemented a five-year, $500 million national package called the Australian Better Health Initiative to reduce the impacts of chronic disease.


Supporting early detection of risk factors and chronic disease
The introduction of Medicare Benefits Schedule (MBS) provides a focused health check for patients aged around 45 years with identifiable risk factors such as weight, smoking or family history. It will identify patients at risk of developing chronic conditions and provide an opportunity to promote lifestyle changes. It will also help in the early detection of chronic disease so that any required treatment can be commenced early and the risk of the disease progression reduced.


Encouraging active patient self management of chronic conditions
This measure will encourage active patient self-management of chronic conditions through targeted training for health professionals to assist people with chronic conditions to better manage their health. State and territory governments will provide leadership and support for a range of local and regional level self-management activities for patients such as face to face group courses, telephone counselling and motivational counselling.

Improving the communication and coordination between care services
Governments will provide incentive funds to appropriate organisations to improve the connections at a local level between service providers including private medical services and community health services so that patient's needs are better met.


Overall, quality of care in Australia in both the public and private sectors is comparable to other developed countries. The major teaching hospitals have significant research profiles and the care is first-rate. Suburban and rural hospitals are also seen as providers of high-quality care.