Fees and out-of-pocket costs
Private specialist care in Australia involves several separate bills from several separate providers. The system is confusing, and the confusion is a large part of what makes it stressful. This page explains how it works, what you will be charged for, and exactly what to ask so that you are not surprised.
Dr Spelman’s practice will always provide you with a written estimate of his fees before you agree to surgery. If anything on this page is unclear, ask the rooms. No question about cost is unwelcome.
Your first appointment
You will be charged a consultation fee on the day of your appointment.
If you have a current referral from your GP or another specialist, you can claim a Medicare rebate for the consultation. The rebate does not cover the full fee — the difference is the “gap”, and it is payable by you.
Private health insurance does not contribute to outpatient consultations. This surprises many people. Your health fund covers hospital care, not visits to a specialist’s rooms.
Without a valid referral you can still be seen, but no Medicare rebate applies and you will pay the full fee.
If you need surgery
Surgery generates bills from several people. You will typically receive separate accounts from:
Your surgeon
Performing the operation and your follow-up care
The anaesthetist
Anaesthesia and post-operative pain management. They set their own fees and will contact you before surgery
The surgical assistant
Most joint replacements require an assistant. Assistant fees are conventionally a percentage of the surgeon’s fee and are billed separately
The hospital
Your stay, theatre, nursing and implants. Usually covered by your health fund, less any excess
A physician
Some patients need a medical review before joint replacement to confirm they are fit for surgery, or additional care on the ward for complex medical issues.
Radiology and pathology
Imaging and blood tests, in hospital or beforehand
Why a gap exists at all
Medicare sets a schedule fee for every medical service, and pays a rebate based on that figure. The schedule has not kept pace with the actual cost of providing care since it was introduced in the 1980s. Health funds pay a further contribution on top of the Medicare rebate for in-hospital treatment, but for most procedures the combined amount still falls short of what the service costs to deliver.
The Australian Medical Association publishes a separate list of recommended fees that reflects real costs more closely. Dr Spelman charges the AMA schedule fee for his private surgical procedures.
Terms you will encounter
MBS (Medicare Benefits Schedule) — the government list of medical services and the rebate payable for each.
Item number — the code identifying a specific procedure. Some operations have several. Your health fund needs these numbers to confirm you are covered.
Gap — the difference between the fee charged and what Medicare and your fund pay.
Excess — the amount you agreed to pay towards a hospital admission when you took out your policy. Paid directly to the hospital.
Gap cover / no-gap arrangements — schemes some funds offer to reduce or remove out-of-pocket medical costs. Participation varies by surgeon and by procedure. For select cases Dr Spelman may offer gap cover or no-gap arrangements for pensioners depending on the procedures being performed.
Informed financial consent — your right to a written estimate of all expected costs before you agree to a procedure. Ask for it if it isn’t offered.
Before you commit — the questions worth asking
Ask the rooms:
• What is the total fee estimate, and which item numbers apply?
• Does the estimate include post-operative follow-up, and for how long?
• Is an assistant required, and who bills for that?
• Do you participate in my fund’s gap-cover scheme?
Ask your health fund, quoting the item numbers:
• Am I covered for this procedure at my level of cover?
• Have I served any waiting periods?
• What is my excess, and what will the fund pay towards medical fees?
• Are there any exclusions or restrictions on my policy?
Ask the hospital:
• What is payable on admission?
• Are implants covered by my policy?
Different funds pay very different amounts for the same operation. Two patients having identical surgery on the same day can face out-of-pocket costs that differ by thousands of dollars purely because of their policies. Confirming your cover before booking is the single most useful thing you can do.
If you don’t have private health insurance
You can still be treated privately, but you are responsible for the full cost including hospital and implant charges. For most joint replacement surgery this is substantial. Public hospital treatment is available at no cost, though you cannot choose your surgeon and waiting times are typically long.
As an example the estimated cost for a self funded patient in a private hospital for a total hip replacement is approximately $25,000-$30,000. This includes the cost of the surgical implants which contribute significantly to the total cost.
TAC and WorkCover
Different arrangements apply — see TAC and WorkCover patients