Safety net helps with bill shock

It’s that time of the year when you might get a letter from the federal government advising that you are about to be eligible for higher Medicare rebates.

It’s called the Medicare Safety Net (MSN) and if you have accumulated enough out-of-pocket medical bills in a calendar year, the threshold – and reduced costs – come into play.

While Medicare covers a range of out-of-hospital services, there is the dreaded gap, which varies between GPs and specialists and for tests and scans depending on where they are done and by whom. The Medicare Benefits Scheme (MBS) lists each medical treatment available. It is, essentially, a price list for treatments outside of hospitals.

‘Gap’ costs can add up, hence the Original Medicare Safety Net (OMSN) and the Extended Medicare Safety Net (EMSN) .

When you have accumulated $481.20 of ‘Medicare gap’ out-of-pocket costs in a calendar year, you are eligible for the OMSN, which means Medicare eliminates the gap and covers 100 per cent of the scheduled fee for MBS services for the rest of that year. Note, that is the scheduled fee, which means you are likely to still be out of pocket. For example, if the GP’s fee was $141, you would receive a MBS rebate of $72.75, or 85 per cent of the MBS fee. After the OMSN is applied, the rebate would be $85.55 or 100 per cent of the MBS fee. Your out-of-pocket cost would be reduced by $12.80.

Individuals don’t need to register, but couples and families must, even if all family members are on the same Medicare card.

For people incurring more out-of-pocket expenses, there is the EMSN, which is for all Medicare cardholders who don’t have concession cards or get a family tax benefit (FTB) part A. Once the threshold of $2184.30 is reached – or $697.00 for concession card holders and families eligible for FTB – Medicare pays 80 per cent of out-of-pocket costs (not just the gap between MBS and rebate) for the rest of that year.

Medicare automatically covers single people and makes them eligible for Safety Net provisions, but families that wish to integrate their out-of-pocket medical expenses must register.

Were you aware of the Medicare Safety Net? Did you know that you had to register if you were not a single? Why not share your thoughts in the comments section below?

Written by Janelle Ward