What is the Medicare Benefits Schedule (MBS)?

You might have heard about it in passing or even looked into it regarding certain fees, but did you know that the Medicare Benefits Schedule (MBS) is essentially the cornerstone of Australia’s entire healthcare system? It’s a system that’s in place to make healthcare services more affordable and accessible for everyday Aussies, so it’s worth doing a bit of reading into it.

If you want to get a better understanding of your medical expenses and maximise your healthcare benefits, this quick explainer will guide you through everything about the MBS and more.

Think of the Medicare Benefits Schedule as something like a book. It’s basically a comprehensive list of medical services that the Australian government subsidises through Medicare. It includes consultations, procedures, tests and more – all the things that doctors and other healthcare professionals can provide to patients. Each service listed on the MBS has a specific fee (called a ‘schedule fee’) which is the amount Medicare will cover for that particular service.

The MBS is in place because our government, thankfully, wants to make sure every Australian has access to essential medical services without being hamstrung by incredibly high costs. The government reviews and updates the MBS regularly to reflect changes in medical practice and technology, which is what keeps it so effective in meeting the healthcare needs of the masses.

Healthcare providers then use the MBS as a reference to bill Medicare for the services they give to patients. As a patient yourself, you can even use the MBS to find out exactly what services are covered by Medicare and how much you can expect Medicare to contribute for those services.

The MBS covers a huge range of medical services, including but not limited to:

1. General practitioner (GP) services: Consultations with GPs for diagnosis, treatment and management of health conditions.
2. Specialist services: These are consultations and treatments provided by medical specialists (e.g. cardiologists, dermatologists, surgeons, etc.).
3. Diagnostic services: Procedures such as blood tests, X-rays and ultrasounds that help diagnose your medical conditions.
4. Therapeutic procedures: Treatments and interventions – from surgeries to chemotherapy to physiotherapy and everything in between.
5. Mental health services: Consultations with psychologists and psychiatrists, as well as mental health plans created by GPs.
6. Allied health services: Services provided by physiotherapists, dietitians, occupational therapists and other allied health professionals.
7. Preventive services: Immunisations, screenings and health check-ups so you can get on top of potential diseases and maintain your overall health.

Bear in mind that the MBS has been designed to cover essential medical services that are commonly needed by Australians. That means not all medical services are covered, and the extent of the cover itself can vary depending on the specific service and your own circumstances as a patient.

As mentioned above, the schedule fee is the amount that the Australian government has determined as being a fair price for each service listed on the MBS. This fee serves as the basis for Medicare rebates, which is the amount that Medicare pays back to patients for medical services.

For most services, Medicare covers 100% of the schedule fee for GP consultations (if they bulk bill) and 85% of the schedule fee for other services. As you can probably already guess, this means you need to pay the difference between the schedule fee and the total cost of the service if your healthcare provider charges more than the schedule fee. This difference is known as the gap. Alternatively, you can take out private health insurance to help cover the remaining costs.

Let’s look at an example. Say a specialist consultation has a schedule fee of $150 and your specialist charges $200. Medicare will rebate 85% of the schedule fee ($127.50) and you will then need to pay the difference between their fee and the Medicare rebate, which in this case would be $72.50.

Getting to grips with how the schedule fee works can be very helpful for anticipating your out-of-pocket costs. It’s also important to note that some healthcare providers may choose to bulk bill, which means they accept the Medicare rebate as full payment for the service and you won’t have to pay any gap.

Medicare Safety Nets are, as the name suggests, in place to protect Australians from high out-of-pocket medical costs. They act as a safety net by being additional rebates for out-of-hospital services once you reach a certain threshold of out-of-pocket expenses in a calendar year.

There are three types of Medicare Safety Nets:

1. Original Medicare Safety Net (OMSN): Once you reach the OMSN threshold, Medicare will pay 100% of the schedule fee for out-of-hospital services for the rest of the calendar year.
2. Extended Medicare Safety Net (EMSN): The EMSN provides an additional rebate for out-of-pocket costs for out-of-hospital services. The rebate is 80% of out-of-pocket costs above the EMSN threshold or the EMSN benefit cap for the service, whichever is lower.
3. EMSN – Concessional and Family Tax Benefit: This is a derivative of the general EMSN and is only for concession cardholders and families who are eligible for the Family Tax Benefit Part A.

To be eligible for Medicare Safety Nets, you’ll need to register as a family or individual with Medicare. Once you reach the relevant threshold (e.g. $560.40 for OMSN; $2,544.30 for EMSN – General as of 2024), Medicare will automatically increase your rebate for out-of-hospital services.

Medicare Safety Nets are particularly helpful for people who have high medical expenses due to chronic conditions, need regular medical consultations or are facing expensive treatments. It’s just another way that you can get the necessary medical care you need without breaking the bank.

Now that you are aware of just how vital the Medicare Benefits Schedule is to our healthcare system, you can start taking steps to financially protect yourself against illness and injury. The best way to do that is to find the best health insurance that matches your lifestyle and medical needs. Be proactive about your healthcare options so you can better manage your finances when the time comes.