GUIDES & RESOURCES

What Is The Medicare Safety Net?

The Medicare Safety Net can seem a little complicated, but once you have the basics on who pays what and when, it can mean savings for you and your family each year.
What is the Medicare Safety Net?

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The Medicare Safety Net is a scheme that reduces your out of pocket medical expenses1. If you or your family have a lot of doctor and specialist visits in a calendar year, once you’ve reached the threshold (spent a certain amount), you may be entitled to get more back from Medicare, even though your doctor’s costs will stay the same2.

How are Medicare benefits calculated and paid?

Every service eligible for a Medicare rebate is listed on the Medicare Benefits Schedule (MBS), with a set scheduled fee amount. Medicare pays a proportion of the scheduled fee, and you’re responsible for the difference. If your doctor or specialist charges a higher fee than the total MBS fee, the difference is known as the ‘gap’ and you’re required to pay it.

This ‘gap’ affects how the different types of Safety Nets and thresholds work.

What are the types of Medicare Safety Nets?

1. Original Medicare Safety Net (OMSN)

If you’re enrolled in Medicare, you will get back 100% of the scheduled fee for your doctor or specialist visit when you reach the OMSN threshold – that is, when you have spent the threshold amount in the calendar year3.

If you’re single, you will automatically receive the 100% benefit when you reach the threshold. Families must be registered under the Family Safety Net to qualify for the higher benefit when the threshold is reached.

The ‘gap’ between the MBS schedule fee and benefit paid by Medicare is how your threshold amount is calculated throughout the year – not by the total of the fees you pay. When you’re eligible for the OMSN, you receive a Medicare benefit of 85% of the scheduled fee, and 100% of the scheduled fee for GP consultations.

2. Extended Medicare Safety Net (EMSN)

The EMSN provides extra benefits for families and singles with high out of pocket medical costs. When you pay your doctor or specialist, your payment includes the MBS fee, plus your out of pocket cost (the difference between the Medicare benefit paid and the total doctor’s cost). Your threshold is calculated based on your out of pocket costs in a calendar year, not the gap fees.

If you’re single, you’ll automatically receive the higher benefit when you reach the threshold. Families must be registered under the Family Safety Net to qualify for the higher benefit when the threshold is reached3. When you reach the threshold, Medicare will reimburse you 80% of the out of pocket costs for medical visits, or the EMSN benefit cap.

What is an EMSN benefit cap?

Some services are capped with a limit on how much you can be reimbursed by Medicare. Extended Medicare Safety Net (EMSN) benefit caps are applied to around 580 Medicare Benefit Schedule (MBS) items, including assisted reproductive technology (ART) services, all consultations, and some surgeries4.

When you reach the EMSN threshold, benefits for capped items are 80% of your out-of-pocket cost. If the out-of-pocket cost is higher than the EMSN benefit cap, you receive the smaller benefit amount (the EMSN benefit cap).

What are the types of Medicare Safety Net thresholds?

Three different thresholds (how much you need to have spent before receiving a higher Medicare benefit for services) apply to match the different types of Medicare Safety Nets.

2019 MSN thresholds

Different MSN thresholds apply depending on your circumstances, income and which type of MSN you’re eligible for: Original, Extended Medicare Safety Net (EMSN) Concessional and FTB Part A, and Extended General5.


Threshold

Threshold amount

Who it's for

How it's calculated

What the benefit is

Original
$470.00 All Medicare cardholders Based on gap amount 100% of schedule fee for out of hospital services
Extended Medicare Safety Net (EMSN) Concessional and FTB Part A $680.70 Concession cardholders and families eligible for FTB Part A Out of pocket costs 80% of out of pocket costs or the EMSN benefit caps for out of hospital services
Extended general $2133.00 All Medicare cardholders Out of pocket costs 80% of out of pocket costs or the EMSN benefit caps for out of hospital services
Source: Table obtained from Department of Human Services subject to ©Commonwealth of Australia (5)

Medicare keeps track of your claims throughout the year. If you’re single and enrolled in the Medicare system, you don’t have to register for the Safety Net. Your higher benefits will be applied automatically if you reach the threshold,
Do I have to register to be eligible for the Medicare Safety Net?

Couples and families must register as a Medicare Safety Net family. This means your medical costs are combined so you reach the threshold and receive higher benefits sooner. You can register as a family if you’re a married or de facto couple (with or without dependent children), or a single person with dependent children6.

Families are notified if you’re close to reaching the threshold. You can then confirm your family members with Medicare to receive the higher benefit when you reach the threshold.

How do I check my Medicare Safety Net balance?

Log in to your Medicare account online via your myGov account, or use the Express Plus Medicare mobile app for instant access to your Safety Net balance and claims history.

What services does the Medicare Safety Net cover?

The MSN applies to out-of-hospital Medicare services and tests listed under the Medicare Benefits Schedule (MBS)7. It’s important to talk to your doctor before your consultation or treatment to confirm if it’s considered an out-of-hospital service under the MBS. For example, if you undergo a procedure as day surgery, it may be considered hospital treatment. Avoid any nasty invoice surprises and ask the question about coverage and gap fees before you go ahead7.

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Sources:
1. https://www.moneysmart.gov.au/life-events-and-you/over-55s/your-money
2. https://www.humanservices.gov.au/individuals/services/medicare/medicare-safety-net
3. https://www.humanservices.gov.au/individuals/services/medicare/medicare-safety-net/you-need-know/who-its#a1
4. http://www.health.gov.au/internet/main/publishing.nsf/Content/EMSN-extended-medicare-safety-net-EMSN-benefit-caps
5. https://www.humanservices.gov.au/individuals/services/medicare/medicare-safety-net/thresholds/2019-table-thresholds
6. https://www.humanservices.gov.au/individuals/services/medicare/medicare-safety-net/you-need-know/safety-net-families
7. http://www.mbsonline.gov.au/internet/mbsonline/publishing.nsf/Content/Factsheet-ExtendedMedicareSafetyNet%20-%20Jan2018

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