Medicare Safety Net

The Medicare Safety Net is an Australian Government scheme designed to protect individuals and families from high out-of-pocket medical costs. Once your out-of-pocket expenses for Medicare-eligible services reach a certain threshold in a calendar year, Medicare pays a higher rebate for your remaining services for the rest of that year.

How does the Medicare Safety Net work?

When you pay out-of-pocket costs for GP or specialist visits, Services Australia keeps a track of those expenses throughout the calendar year (1 January to 31 December). Once you reach the Medicare safety Net threshold, your Medicare rebate increases automatically for the rest of the year.

The two important terms: Gap amount vs out-of-pocket cost

These two terms are similar but mean different things under the Safety Net: 

Gap amount: The difference between the Medicare Benefits Schedule (MBS) fee and the Medicare rebate you receive. This is the amount that accumulates towards the Original Medicare Safety Net (OMSN) threshold.

Out-of-pocket cost: This is the total amount you pay yourself after the Medicare rebate is applied. If your doctor charges more than the MBS fee, your out-of-pocket cost is higher than the gap amount. This amount is used to calculate the Extended Medicare Safety Net (EMSN) threshold.

Step-by-step: How accumulation works

1. Every time you use an eligible out-of-hospital medical service, your gap and out-of-pocket costs are recorded. 
2. Only paid and verified costs count towards the Medicare Safety Net thresholds. 
3. Once your gap fee costs reach the OMSN threshold, Medicare increases your rebate to 100% of the MBS fee for the rest of the year. 
4. Once your out-of-pocket costs reach the EMSN threshold, Medicare pays up to 80% of future out-of-pocket costs for eligible services. 
5. On 1 January each year, all Safety Net totals reset to zero. 

Note: In-hospital services, including most procedures at day surgery facilities, are not eligible for the Safety Net. Only out-of-hospital Medicare services count. If you are unsure, ask your GP or specialist before you attend.

You can monitor your progress toward the threshold any time via your Medicare online account through myGov.

Original Medicare Safety Net (OMSN) vs Extended Medicare Safety Net (EMSN)

These are two different Medicare Safety Nets that run alongside each other. Each one covers different expenses and offers different levels of additional benefits.

OMSN: Under the OMSN, Medicare increases your rebate up to 100% of the MBS fee. This means you will not have to pay out of pocket if your doctor charges more than the MBS fee. However, you must still pay any amount charged in excess of the MBS fee.

EMSN: The EMSN helps reduce high medical expenses, especially when doctors charge above the MBS fee. After you reach the EMSN threshold, Medicare pays up to 80% of eligible out-of-pocket expenses. However, some services have fixed payment caps that limit the amount of the extra rebate.

Do I need to register for the Medicare Safety Net?

It depends on your household situation.

Singles: If you are single and have no dependents, there is generally no need to register separately. Services Australia automatically tracks your eligible medical costs and applies higher benefits once you reach the threshold.

Couples and families: Couples and families need to register together for the Medicare Safety Net. This allows everyone’s costs to accumulate toward a single shared threshold, making it easier to qualify for higher Medicare benefits sooner. Register as a Safety Net family here.

Medical Disclaimer: The content on this page is for informational purposes only.