Australian healthcare is partially free. The country’s public system, called Medicare, covers the cost of treatment in public hospitals, subsidises doctor visits, and heavily discounts prescription medications. But several common health needs, including dental care, glasses, physiotherapy, and ambulance services, are not covered at all. What you actually pay out of pocket depends on where you live, which doctor you see, and whether you hold private health insurance.
What Medicare Covers at No Cost
If you’re admitted to a public hospital as a public patient, your treatment is free. That includes surgery, tests, specialist consultations, and aftercare during your stay. You don’t choose your doctor and you may wait longer for non-urgent procedures, but you won’t receive a bill.
Outside the hospital, Medicare subsidises visits to GPs, specialists, and certain diagnostic services like blood tests and imaging. Whether you pay anything for these visits depends on whether the provider “bulk bills,” a system where the doctor accepts the Medicare rebate as full payment and charges you nothing. In 2025, about 79% of GP services are bulk-billed. That’s down from a peak of 89% in 2020 and 2021. If your GP doesn’t bulk bill, you pay the full fee upfront and claim a rebate back from Medicare, leaving you with a gap that typically ranges from $20 to $80 per visit.
What Medicare Does Not Cover
Several routine health expenses fall entirely outside Medicare:
- Dental treatment and orthodontics
- Glasses and contact lenses
- Physiotherapy, chiropractic care, and speech therapy
- Home nursing
- Ambulance transport
These gaps are significant. A single dental check-up and clean can cost $200 to $350, and a pair of prescription glasses often runs $300 or more. For many Australians, these are the expenses that make healthcare feel far from free.
Ambulance Costs Vary by State
Ambulance coverage is one of the most confusing parts of the system because the rules change depending on which state or territory you live in. Medicare does not cover ambulance services anywhere in Australia.
Queensland is the most generous: the state government covers ambulance costs for all permanent Queensland residents, even if they need an ambulance interstate. In Tasmania, the state provides free ambulance cover for residents as well. In other states like New South Wales, Victoria, and South Australia, residents can face substantial bills. An emergency ambulance callout in NSW costs $909 plus $8.20 per kilometre. Without private health insurance or a separate ambulance membership, that bill is yours.
How Prescription Medicines Are Priced
The Pharmaceutical Benefits Scheme (PBS) caps the price of most prescription medications. General patients pay up to $25.00 per script, while concession card holders (pensioners, low-income earners, and some other groups) pay up to $7.70.
There’s also a safety net for people who need many prescriptions in a year. Once a general patient’s total PBS spending reaches $1,748.20 in a calendar year, each script drops to $7.70. Concession card holders hit their safety net at $277.20, after which their prescriptions become free. These thresholds reset each January.
How Medicare Is Funded
Medicare isn’t funded by a single premium you pay. Instead, it’s built into the tax system. Most Australian taxpayers pay a Medicare Levy of 2% of their taxable income. This is automatic and appears on your tax return, not as a separate bill.
Higher earners who don’t hold private hospital insurance also pay a Medicare Levy Surcharge. For singles earning over $101,000 (or families over $202,000), the surcharge adds 1% to 1.5% on top of the standard levy, depending on income. The surcharge is designed as an incentive: take out private hospital cover and you avoid it.
Why Many Australians Still Buy Private Insurance
About half of Australians hold some form of private health insurance. The main reasons are practical. Private insurance lets you choose your own surgeon, get a private room in hospital, and skip public waiting lists for elective procedures like joint replacements or cataract surgery, where public waits can stretch months or even years. “Extras” cover handles the things Medicare ignores: dental, optical, physio, and similar services.
The government uses financial incentives to push people toward private cover. The most notable is Lifetime Health Cover loading. If you don’t take out private hospital insurance by the year you turn 31, your premiums increase by 2% for every year you delay. Someone who first buys hospital cover at age 40 pays a 20% loading on top of the standard premium. The maximum loading is 70%, which applies if you wait until age 65. Once you’ve held cover continuously for 10 years, the loading is removed.
There’s also a private health insurance rebate, where the government covers a percentage of your premium cost depending on your age and income. Combined with the levy surcharge you’d otherwise pay, private insurance can end up costing a similar amount to going without it for higher earners.
What Visitors and Non-Citizens Get
Medicare is available to Australian citizens, permanent residents, and citizens of countries with reciprocal healthcare agreements (including the UK, New Zealand, and several European nations). These agreements generally cover essential medical treatment but not elective procedures.
Tourists from countries without a reciprocal agreement have no Medicare access. They pay full price for all medical services, including emergency care and ambulance transport. Travel insurance is the only safety net for these visitors.
The Practical Reality
For a healthy person who rarely sees a doctor, Australian healthcare can feel close to free. A bulk-billed GP visit and a $25 prescription are the extent of most interactions with the system in a given year. But for anyone who needs dental work, wears glasses, requires physiotherapy after an injury, or calls an ambulance in most states, the out-of-pocket costs add up quickly. The system covers the most expensive and urgent care well, while leaving everyday health maintenance largely to individuals to fund.