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Throughout your life, you may face health issues that require the type of attention and treatment that only a specialist doctor can provide (e.g. an immunologist if you have a certain allergy). In these cases, you’ll be referred to one usually by your GP or another medical professional.

Depending on who you’re seeing and the treatment and tests you require, you could face out-of-pocket costs.

Let’s break down how Medicare and health insurance may cover specialist treatment – and when you may need to dip into your savings.

  • Medicare rebate for specialist consultations and treatment.
  • How a hospital insurance policy helps cover specialist costs.
  • How much specialist treatment could cost?
  • When you’ll pay out-of-pocket fees for specialist doctors.
  • How to reduce out-of-pocket costs.
  • Questions to ask before treatment.

Is there a Medicare rebate for specialist consultations and treatment?

When you’re treated as a private patient in a private or public hospital, Medicare automatically rebates some of the cost of your treatment providing it’s listed on the Medicare Benefits Schedule (MBS)

The MBS is a list of item numbers assigned to medical services; each item has an assigned cost that the government deems reasonable. Medicare will rebate 75% of the cost that’s listed on the schedule for that item.

For treatment outside of hospital like dialysis or rehabilitation, you may be able to get a Medicare specialist rebate of 85% of the MBS cost.

To be eligible for a Medicare rebate, you need to hold a Medicare card.

Is there specialist health insurance that can help cover treatment costs?

When it comes to treatment from a specialist, health insurance can help cover costs while you’re in hospital providing the treatment you need is included in your policy.

If your treatment is listed on the MBS, Medicare will rebate 75% of the treatment’s MBS fee. Then, your insurer will cover the remaining 25% of the MBS fee. See our example below:

private health insurance vs medicare covered costs for specialist appointments

Keep in mind that some specialists can charge you more for your treatment than what is listed on the MBS (e.g. they could charge you $500 for your treatment, even though its MBS fee is $400).

As such, it’s possible that you may have some out-of-pocket costs, which are also referred to as ‘the gap’.

Many insurers provide an extra level of cover (called gap cover), which may help further reduce the amount you need to pay out-of-pocket by limiting the maximum amount your specialist charges you as an out of pocket expense.

Below, we’ve included a visual example of how Medicare and your insurer may help cover the cost of treatment when the treatment is greater than its MBS fee.

In our example, the total cost the specialist charges for treatment is $1650, while it’s listed MBS fee is $900. In this instance, the insurer’s gap cover reduces out-of-pocket costs to $500.

gap payment and out of pocket cost for specialist appointments and treatment on private health insurance vs medicare

However, for your hospital policy to contribute to the cost of specialist consultations (the orange and grey portion of the above example), your treatment must meet specific criteria:

1. Your treatment must be in-hospital

For your hospital policy to contribute towards your specialist doctors’ fees, your consultation or treatment must take place while you’re admitted in hospital as an in-patient.

If you’re seeing a specialist doctor without being admitted to hospital (i.e. as an outpatient or just for an appointment), your health insurer will not contribute towards the cost, even if you see them in their rooms within the hospital. This includes obstetrician and gynaecologist consultations prior to giving birth.

But the good news is that outpatient consultations attract a benefit from Medicare of up to 85% of the MBS fee.

2. Your treatment or procedure must be covered under your policy

If you see a specialist doctor while you’re admitted in hospital, the treatment you’re receiving must be included on your hospital cover for your health insurer to contribute towards their fees.

Not all health insurance policies cover all procedures and claiming restrictions may vary, so make sure you know which treatments you’re covered for and which procedures and services are not included.

If you find your cover isn’t suitable for your treatment, or if you don’t have a policy, try comparing health insurance with our handy tool.

With our free tool, you can select which treatments and services you’d like covered in your policy. From there, we provide you policies from some of Australia’s top insurers, so you can easily compare features, cover options, excesses and premiums.

Consider coverage early as waiting periods may apply.

How much will you pay for specialist treatment?

The amount you need to pay in total for your treatment depends on:

  • Where the treatment takes place, as an out-patient or as an in-patient
  • For in-patient services, the type of hospital policy you have (i.e. Basic, Bronze, Silver or Gold)
  • If your treatment is one of your policy’s inclusions.
  • Your specialist’s willingness to participate in ‘Gap Cover’ – leading to the ‘gap’ above the MBS fee owing on your treatment – which you are responsible for; and
  • Any additional specialist’s fee’s required to be present as part of the surgery ie; Anesthetists
  • Any other potential out-of-pocket costs (such as excess’ or copayments for your hospital stay.)

Keep in mind that the cost of your treatment will depend heavily on your specialist – they can set a fee they believe is suitable for their services.

As such, it’s crucial you ask your specialist and any additional specialists to participate in your health fund’s gap cover program, check that the treatment is included in your health insurance product, and know all possible out of pocket costs before booking or agreeing to your treatment.

Other costs to be aware of

When you use your hospital policy for treatment, you may need to pay an excess. An excess is an amount you agree to pay when you are admitted to hospital. If you elect to pay more for your excess, it will lower your policy premiums.

You might need to pay your excess every time you go to hospital or as a once-off in a membership period– it depends on your policy and insurer.

Also keep in mind that you may also need to pay a co-payment. A co-payment is where you agree to pay a certain amount of money for each day you’re in hospital.

When will you pay out-of-pocket for specialist treatment?

If your specialist charges more than the Medicare Benefits Schedule (MBS) fee.

Some specialists charge a higher fee for their services than what’s listed on the MBS. As such, Medicare and your health insurer’s contributions towards your bill might not cover all expenses. This leaves you to pay the rest – the gap – out of pocket.

If you’re seeing a specialist out of hospital.

When you’re receiving out-of-hospital specialist care, Medicare might not always provide a rebate. This is where extras health insurance may help. This type of policy can provide cover for certain specialist treatment that Medicare doesn’t cover.

Depending on the type of extras policy, you could be covered for visits to:

  • dentists
  • psychologists
  • chiropractors
  • optometrists, and more.

When you claim on your health insurance policy.

Depending on your policy and insurer, you may need to pay an excess or co-payment.

How can you reduce your out-of-pocket hospitalisation or specialist costs?

Be treated at Partner or Agreement hospital.

Ask your health fund for their list of partner or agreement private hospitals. At these hospitals, your insurer has negotiated and agreed to the amounts to be charged and will than cover those costs related to:

  • admission
  • accommodation
  • theatre
  • labour ward.

If you choose to go to a private hospital that isn’t a partner or agreement hospital with your insurer, you may face higher out-of-pocket expenses for your treatment.

Public hospitals, on the other hand, are typically treated as agreement hospitals by your insurer. So, if you want to be treated as a private patient in a public hospital, your out-of-pocket fees are likely to be less than being in a private hospital.

Be treated by a partner or gap cover agreement specialist.

Once you know what you need to be treated for, speak to your health insurer, ask for their list of partner or gap cover agreement specialists for your required treatment. These are specialists that have previously participated in ‘gap cover’ agreements with that fund.

Seeing one of these specialists can reduce the likelihood of being severely out of pocket for fee’s charged above the scheduled fee for that procedure. It’s important to discuss the fee’s that they will be charging and request that they participate in your funds gap cover to reduce your out of pocket expenses.

Don’t forget that multiple specialists might see you during your treatment. Ensure you’re clear about who will be involved in your care and ask specialist to be seen by those who will also participate in the gap cover arrangement.

Tip: Specialists can choose, on a case-by-case basis, whether they’ll participate in a gap cover agreement with your health fund. So, make sure you ask them during your consultation.

a patient with a specialist discussing health insurance

Questions to ask your insurer and specialist before treatment

When signing on the dotted line for treatment, it’s important you’re providing informed financial consent – that is, you understand and are fully aware of the costs your treatment will incur.

Below are some questions you can ask to help guide you through the process.

Ask your insurer:

  1. Does my policy provide cover for this type of treatment?
  2. How much of my treatment, appointments, tests, etc. will my policy cover?
  3. How much will I need to pay for this treatment, including excess (and any co-payments, if applicable)?
  4. Which hospitals and specialists do you have agreements with?

Ask your specialist:

  1. How much will my treatment cost, and when will I need to pay?
  2. Are there any other consultations or tests I may need to pay for (again, when will I need to pay these)?
  3. Are these costs estimates?
  4. Is it possible that these costs could change? If so, when will you advise me of changes?
  5. Will I need to pay a gap for other specialists (i.e. anesthetists or surgeons)?
  6. Will you participate in a gap cover arrangement with my health fund?

So, what are you waiting for?

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