Health Care in Australia

by Jose Marc Castro on August 8, 2009

healthcareAUSTRALIAAustralia is a relatively large country with a land area of about 7.6 million square kilometers. Despite the vast land area, Australia has a small population, which is estimated at only 21 million people in 2007. About 89.3% of the population are of European descent and only 2.3% are indigenous or of Aboriginal descent.

Similar to other developed countries, the Australian population is characterized as an ageing society.  Fertility rate is low at 1.4 births per woman in 2005. According to experts, this figure is not enough to replace the impending ageing population. Currently, the Australian Government strongly encourages skilled and sponsored migration to sustain its population. The net migration rate recorded as of 2005 is 3.91 migrants per 1000 population.

Australian health is getting better in the last 10 years. Life expectancy has increased to 81 years old for males and 83 years old for females in 2008. This is one of the highest among developed countries.  Infant mortality is low at 4.7 deaths per 1000 population. Some of the common health concerns in Australia are skin cancer, heat strokes, obesity, diabetes, dengue fever, and other chronic diseases common in developed countries.

Australian Health Care at a Glance

The Australian health system is generally based on a broader perspective as defined by the World Health Organization. It does not only focus on the physical and mental health of its population but also on their general state of social well being and is characterized by a mixture of public and private health service providers. Known as Medicare, it coexists with a private health system. This was funded partly by 1.5% of an income tax levy with an additional levy of 1% for high-income earners.

The Australian government takes a Commonwealth form with six (6) States and two (2) Territories. In terms of health, the Commonwealth takes lead in the development of national health policies, regulations, and funding. The States and Territories operate in matters not covered by the Commonwealth’s responsibilities such as the execution, oversight, and regulation of public health services as well as health care providers.

Some of the government’s health strategies include: a) the provision of clinical services and programs, b) improvement of the social, physical, and economic environment of groups or individuals at special risk, c) reduction of health risk exposures, d) capacity building to enable individuals to exercise control in their environment and make appropriate health choices, and e) the provision of culturally relevant services, among others.

It is estimated that about seventy percent (70%) of Australia’s health expenditure is funded by the government. The commonwealth shoulders 67% of this cost covering three (3) national subsidy schemes, a) Medicare, b) the Pharmaceutical Benefits Scheme, and c) 30% Private Health Insurance Rebate while the remaining 23% is covered by the States and Territories.

Medicare in Australia

Medicare is a National Subsidy Scheme that subsidizes services and prescription medicines bought from pharmacies. It provides free treatment in a public hospital. Medicare also provides free or subsidized payments to health professionals for specific services.

It was established in 1984 aimed at providing high quality health care that is affordable and accessible to all Australian residents regardless of their circumstance. For the period July 2004 to June 2005 alone, there are 20.5 million people who have registered for Medicare benefits. Also, there are about 236 million services processed during the same period.

Medicare is financed through progressive income tax and Medicare levy derived from incomes of Australian residents. The amount of contributions depends on their ability to pay.

Claiming Medicare benefits can be done in several methods. One is by paying the doctor’s fee in full and then reimbursing the benefit to Medicare at a later time. Another possible method of claims payment is by requesting the doctor’s fee in advance from Medicare. Medicare shall issue a check payable to the doctor. Doctors may also deduct the subsidy that will be provided by Medicare from the fees and submit the benefit claims directly to Medicare. Claims can be made through post or in person at Medicare offices or in designated agencies. Another aspect of Medicare was shared in the Australia Expat Forum last February 14, 2009:

You may have to take out private health but for prior conditions that will be expensive if you can get the illness covered at all.  This link What Medicare covers – Medicare Australia says what is and isn’t covered by Medicare.

Pharmaceutical Benefits Scheme in Australia

Through the Pharmaceutical Benefits Scheme, the government provides high subsidies on a number of prescription medicines. This scheme is available to all Australian residents and international guests from countries where Australia has Reciprocal Health Care Agreements. The Australia Government subsidizes the cost of prescription making it more affordable for all Australians.

Individuals or families with heavy medicine utilization can avail of the subsidized rate. Eligible patients are categorized as either concessional or general patients. Concessional patients are those that have Veterans’ Affairs Cards, Family and Children’s Services Cards, or passed certain criteria and declared as disadvantaged. Concessional patients can claim higher subsidies than general patients. Subsidies in this scheme are being paid directly by Medicare to the pharmacy on a reimbursement basis.

Private Health Insurance in Australia

Private health insurance represents about 11% of health care funding in Australia. It can be used either in a private hospital or in a public hospital by patients who chose to be private patients. Similar to other countries, private health insurance allows the patient to have a wider option of doctors and hospitals. The timing is also important on the conduct of a procedure can be chosen by the patient. Private insurance also covers some services not covered by Medicare such as optical, physiotherapy, podiatry, and dental services.

The government provides a subsidy equivalent to 30% of the insurance premiums to those who have subscribed to private health insurance. The government facilitates payment of reduced premiums to health funds or directly to contributors as alternative payments. In the fiscal year 2004 to 2005, there are already 4.7 million registered subscribers of private health insurance. Of this, there is about AU$2.7 million paid to health funds and about AU$2.3 million claims directly paid to contributors. As of 2008, a total of $42.8 billion was spent on overall health care in Australia.

The government’s support to private patients includes the regulation of insurance companies to ensure that community rating is observed. This means that the insurance company should charge equal premiums regardless of medical status or claims history. This will ensure that the chronically ill or the aged will not be overcharged by the insurance company.

Another government program that encourages individuals to avail of a private health insurance early in their lives and maintain them is the Lifetime Health Cover. This means that people aged 31 and below and who chose to stay in private insurance will be paying lower premiums. Insurance premiums for people aged over 31 years old will be charged 2% higher premium for each year the individual has delayed joining a private health insurance.

A suggestion has been made in the Australia Expat Forum last February 19, 2009:

Not all the medical treatment is covered by Medicare. Private healthcare in a public or private hospital, ambulance transport, dental work and optometry are examples of services which fall outside Medicare cover. Many people decide to purchase private health insurance to cover some or all of these areas.

Health Care Options for International Travellers in Australia

Prior to entering Australia, some visitors are required to undertake certain health examinations such as HIV, Hep B& C, and/or a chest x-ray. These tests shall be required if:

  1. The visitor intends to attend a classroom environment;
  2. Intends to stay for more than 3 months and have recently been in a high tuberculosis risk country;
  3. Aged 70 year or older;
  4. A parent sponsored migration applicant who intends to stay for more than 6 months;
  5. Has an existing medical condition; and
  6. Has a possibility of entering a hospital or other health care facilities as a patient, visitor, trainee, or employee.

While in Australia, visitors that come from countries where the government has reciprocal health agreement can avail of Medicare benefits. However, the benefits of the reciprocal agreement do not include treatment as the purpose of their visit. Other visitors not eligible for Medicare can avail of a comprehensive health insurance to cover unexpected medical expenses during their stay.

Since special medical treatments are lower in Australia than in other developed countries, many patients go to Australia for treatment and other medical services. People going to Australia for treatment should be fully aware of all the related costs. They should also obtain an appropriate visa before entering Australia.

International students are required to avail a low cost health insurance called Overseas Student Health Cover during their stay in Australia.

{ 7 comments… read them below or add one }

Lynn December 13, 2009 at 5:42 pm

I am 63 years young moving to AU for 3 years. I have a 457 visa status as a dependent parent of my daughter who will be working there. I have diabetes and am looking into what my healthcare options would be. I can only keep my US healthcare for 6 months. Can anyone help?


Austin10 September 3, 2010 at 4:04 pm

Are companies required to provide private health insurance plans for their employees?


Jeff November 23, 2010 at 1:56 am

I am interested in moving for a job as a clinical pathologist from the US. I was initially shocked to find out that health care packages are not standard, but then it made more sense given that they have a nationalized health care system. Nonetheless it still is of no comfort to the potential expat from a country without reciprocity. Don't be surprised if they don't seem to understand your expectation for a health care package. It is a big problem…


Lucia Alexander December 1, 2010 at 3:42 pm

I have lived on the uk since the 1970's and intend to return to Australia in the near future. I have both UK and Australian Citizenship and have lived in australia since I was 3 years of age, and worked in australia for 12 years prior to leaving for the uk. What would be my monthly costs for medical insurance as I have not paid up for years like a permanent resident would have.
I cant seen to find that information on any site.
Many thanks,
Lucia Alexander


ashok February 11, 2011 at 6:22 am

i am studying in australia for last 2 years and me and my wife have still valid student visa. when testing a blood of my spouse(she is in my dependent) in a clinic , it charged as international visitors rate and when asking them they said that your spouse always charge as the visitors rate only you will be charge as low rate? does it right and how can i clam that? does anyone help me ? please…


marilyn moore May 11, 2012 at 5:08 am

hello there…
i need some from the philippines and i married an aussy guy..while waiting for my spouse visas approval im here for a tourist my problem is im pregnant..and i want to know if i can avail a prenatal check up with a low cost considering i cnt avail a medicare from my hushband yet..please i need ur help if uve any idea..tnx


Anne April 21, 2013 at 12:23 pm

I am visiting my sons in Australia for 2 months, I cannot take my humira medication with me as it needs to be kept between 2-7 degrees. This is impossible to travel with. Is there any way I can get my medicine in Australia and not pay the full price as it is very expensive. I know there is a health care agreement signed between Australia and Britain, but i cannot make head nor tail of it. Can anyone give me any more information that could help me.


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