What Is the Medicare Safety Net?

The Medicare Safety Net is designed to help Australians manage out-of-pocket expenses for medical services, including mental health care. By understanding how the Medicare Safety Net operates, you can better anticipate and plan for your healthcare costs throughout the year.

Automatic Enrolment: If you’re an individual, you don’t need to take any action—Services Australia will automatically apply the higher rebate once you reach the threshold. If you’re part of a family, you’ll need to register with Services Australia to combine your family’s medical expenses.

Example: How the Medicare Safety Net Works in Practice

Imagine you’re attending regular psychiatric consultations at Wellvue, and each session costs $300. Medicare provides a rebate based on the government’s schedule fee, which might be $100 for a psychiatric consultation. Before reaching the Medicare Safety Net threshold, you’d receive a rebate of $85 (85% of the schedule fee), leaving you with an out-of-pocket cost of $215 per session.

Here’s how the Medicare Safety Net could help reduce your costs:

Original Medicare Safety Net (OMSN) – 2024: Once your total gap payments (like the $215 per session) reach $560.40 in a calendar year, the OMSN is triggered. After reaching this threshold, Medicare will cover 100% of the schedule fee for out-of-hospital services. However, you’ll still be responsible for the difference between the schedule fee and the actual amount charged by your psychiatrist. So, in this example, if the schedule fee is $100, Medicare would now cover $100, and you would pay the remaining $200 per session.

Extended Medicare Safety Net (EMSN) – 2024: The EMSN provides additional support once your total out-of-pocket expenses exceed $2,544.30 (for most individuals) in the same calendar year. After this threshold is reached, Medicare covers 80% of your remaining out-of-pocket costs for the rest of the year. This means that instead of paying $215 per session, you would now pay only $43 per session ($215 minus 80%).

For Concession Cardholders or Families Eligible for Family Tax Benefit Part A: The EMSN threshold is lower, set at $811.80 in 2024. Once this threshold is reached, Medicare will start covering 80% of your out-of-pocket costs for the remainder of the year.

Optimising Your Medicare Safety Net as a Couple or Family
One significant advantage of the EMSN is that if you’re part of a couple or family, you can register as a family with Medicare. This allows you to combine your out-of-pocket expenses across all family members. As a result, you’re likely to reach the EMSN threshold faster, enabling your entire family to benefit from the 80% coverage on out-of-pocket costs sooner. This can be particularly beneficial if multiple family members require regular medical or mental health care.

Further Information
To learn more about how to register as a family and maximise the benefits of the Medicare Safety Net, visit Services Australia or contact their support team for personalised assistance.