An out-of-pocket cost refers to the amount you need to pay for a medical appointment or treatment.
Often termed a ‘gap payment’ or ‘patient payment,’ your out-of-pocket cost is the difference between what your doctor, allied health professional, or hospital charges for a service and what Medicare or your private health insurer covers for that service.
When you receive medical treatment, any gap between the charges from your healthcare provider and what Medicare or your private health insurer pays for that service becomes your responsibility. This is the fundamental concept of out-of-pocket costs.
Understanding how out-of-pocket costs work can help you better manage your healthcare expenses. Use CheckYourBill to find a Private Health Insurance policy that minimizes these costs while meeting your needs.
The out-of-pocket cost you have to pay vary depending on:
- How much your doctor or health services provider charges you
- Whether you have treatment inside or outside a hospital
- Whether your treatment is covered by Medicare and how much Medicare pays for it
- If you are treated in a hospital, whether you are a public or private patient
- Whether you have Private Health Insurance for the treatment you are receiving and the level of that cover.
Private Health Insurance can only cover doctors fees for treatment in hospital.
Before you receive treatment, ask your doctor, health care provider and your hospital about any out-of-pocket costs you may have to pay. Otherwise, you may pay significant out-of-pocket costs for your treatment.
Steve pays $500 in out-of-pocket costs
Steve was admitted to hospital as a private patient. His doctor charged $1,500 for their service. The Medical Benefit Schedule (MBS) fee for the service was $1,000. Medicare paid $750 (75%) and Steve’s health insurer paid $250 (25%). This left a gap of $500 for Steve to pay as an out-of-pocket cost.
Before agreeing to treatment, ask your doctor for:
- The Medicare Benefits Schedule (MBS) item numbers for their services,
- An estimate of your out-of-pocket costs,
- Whether other doctors or health care providers are involved in your care and how you can get an estimate of their fees.
Always request any estimates in writing.
Once you have the MBS item numbers, your health insurer can tell you exactly how much it will pay under your Hospital Cover for those treatments.
Want to know more?
If you’re looking for additional support to achieve your health goals beyond what your current Private Health Insurance policy offers, use our CheckYourBill platform to compare your current fund with other policies that better suit your needs. This comparison could potentially save you money while helping you improve your health, making 2024 your best year yet.
If you haven’t already got Private Health Insurance, now is an excellent time to consider getting a policy to support your health aspirations. Whether you’re aiming to run a marathon or lose weight, having the right Private Health Insurance can significantly impact your journey. Start your journey today.
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