Medicare and the PBS
Medicare Safety Net
The Medicare Safety Net is designed to protect people who have high medical costs from paying large gap fees. It means that once you have reached the annual threshold, visits to your doctor, or tests outside of hospital may cost you less for the rest of the calendar year. For example, once you reach the threshold, you still pay the same amount upfront to your doctor. However, you may receive a higher Medicare benefit, making your out-of-pocket expenses much less.
The Medicare Safety Net covers a range of doctors’ visits and tests that you receive out of hospital. It does not apply to any out-of-pocket costs you pay for treatment or tests as an inpatient in hospital.
Services that count towards the Medicare safety net include:
- GP and specialists’ consultations
- scans and test such as bone scans, CT scans, X-rays and ultrasounds
- blood tests.
Medicare safety net thresholds are changed annually to account for inflation. There is also a Pharmaceutical Benefits Scheme (PBS) Safety Net, which helps if you have a lot of prescriptions for medications in a calendar year. This mechanism helps to protect people who need to see the doctor regularly, or have tests regularly, from having to pay large numbers of gap fees, which could amount to a substantial cost.
The Medicare Safety Net covers a range of doctor visits and tests that you receive out of hospital. Families and couples need to register, but individuals are automatically registered.
Individuals are automatically registered for the safety net but families and couples need to register to link all individuals as one family. If you have a partner and/or children, you need to register even if you are all listed on the same Medicare card. This is to ensure that the medical costs of all family members are taken into account so you will reach the threshold as soon as possible.
Safety nets are a mechanism to protect people who need to see the doctor regularly, or have tests regularly, from having to pay large numbers of gap fees which could amount to a substantial cost. The Medicare Safety Net covers a range of doctor visits and tests that you receive out of hospital. Families and couples need to register, but individuals are automatically registered.
There are three Medicare Safety Net thresholds currently:
- To reach the first safety net threshold, your gap fees (the difference between the schedule fee and the Medicare rebate) for out-of-hospital services must accumulate to a certain amount (currently $430.90) within a calendar year. Once the threshold is reached, you will receive 100 per cent of the Medicare schedule fee for all out-of-hospital services. However, a person will still have to pay the additional difference if the doctor charges more than the schedule fee.
- The second safety net is for concession card holders and families eligible for Family Tax Benefit Part A. Once out-of-pocket costs (the difference between the Medicare benefit and what a doctor actually charges) reach the threshold, Medicare will meet 80 per cent of any further out-of-pocket expenses for out-of-hospital services for the remainder of the year. This includes costs above the Medicare schedule fee.
- The third safety net is the extended general safety net. This applies to all Medicare cardholders and comes into play if out-of-pocket costs reach the threshold of $1248.70. For any out-of-hospital services beyond this, Medicare will pay 80 per cent of out-of-pocket costs or the extended Medicare safety net benefit cap.
The thresholds are changed annually to account for inflation.
If you are concerned about gap fees associated with doctors’ appointments and tests, talk to your specialist about whether you can be bulk billed. Bulk-billing is when your health professional accepts the Medicare benefit as full payment for a service. Many health professionals bulk bill pensioners and Health Care Card holders.
You can also talk to your specialist or service provider about whether they can claim the Medicare rebate on your behalf when you pay your full account so that you don’t need to submit a claim at all. Medicare will then pay the rebate to the provider so that you only need to pay the gap amount.
Pharmaceutical Benefits Scheme (PBS)
The Pharmaceutical Benefits Scheme (PBS) is a federal government system that subsidises the cost of some medications. Everyone who has a Medicare card is covered by the PBS and can access PBS-listed medications at a subsidised cost. The subsidy may not cover all of the cost; individuals usually pay a contribution known as the PBS co-payment, script fee or dispensing fee. This fee is capped per prescription (at the time of writing) at $38.30 (general co-payment) and $6.20 concessional payment for people on a Health Care Card or for those on a pension.
Some breast cancer drugs that you may hear about are not approved for the PBS and not subsidised. This is particularly common for new drugs that have not been through the extensive PBS approval process. For more information, see the PBS website.
PBS Safety Net
The PBS safety net helps people who need a lot of prescription drugs. When you or your family reach the safety net threshold, you can apply for a PBS Safety Net card. This will make PBS-subsidised drugs less expensive or free for the rest of the calendar year.
You don’t need to register for the PBS Safety Net, but you do need to keep a record of all your PBS drugs on a prescription record form, which you can get from any pharmacy. Some pharmacists can keep a computer record for you, but if yours can’t, or if you visit different pharmacies, you will need to keep your own records.
When you get close to the PBS threshold, you should ask your pharmacist for help with applying for a PBS safety net card.
Some years the PBS prescriptions really mount up quickly. It helps to keep our main pharmacist updated on the receipts from other pharmacies. They can let us know if we’ve reached the PBS Safety Net and help us with explanation and registering. – Jenny Anne
Who can help explain the different safety nets and how they might apply to me?
Your pharmacist or Centrelink office can explain the safety nets associated with the cost of medications and medical bills. You can also visit the PBS website.