Australian healthcare system - a primer.

Posted 29/4/2021 by Alasdair Spinner


Feedback from doctors who have migrated to or worked in Australia for a period of time tends to be positive in terms of the Aussie health system and the subsequent implications for them in turns of remuneration, allowances, workplace facilities, funding etc. 


It’s not all about the money though. A psychiatrist said to me the greatest thing she could say about moving to Australia from England was she could have  hobbies for the first time in 20yrs due to having more free time.


I’ll let the reader decide if this says more about consultant working conditions in England or in Australia.No system is perfect and each medical practitioner's experience is subjective. 


So how is the Aussie health care structured? To get a handle on it and the implications to you as a potential employee, let’s look at Australia’s governance structure. Australia is a federation of states and territories. Significant power is devolved to them including healthcare operations. Each State and territory has a parliamentary government which provides services to its citizens reflecting the varied logistical, economic and social requirements. 


Public health care is devolved to each of these state and territory governments but most of their funding comes from the federal government in Canberra.


Universal healthcare is delivered through the Medicare system. It gives people access to subsidised services, prescriptions and free hospital care as a public patient. Since 1984, Medicare’s been funded by a 1% tax on an individual’s taxable income (Medicare levy) - regardless if you have private health insurance.The federal government runs the Medicare Benefits Schedule giving rebates for patients using the services of medical practitioners and allied health professionals. The benefits are based on a fee schedule which is negotiated with the government and the medical community. 


Any health system needs a lot of cash. Australia spent $185 billion on health goods and services in 2017–18, or $7,485 per person.Using the OECD’s system, the health spending to GDP ratio in Australia was 18th and 8th among all OECD nations 2000 - 2017. Between 2014 - 2017 while growth in health spending was relatively high in Australia (5.0% per year on average, 13th in OECD), Australia’s GDP growth was only 3.7% per year on average (21st in OECD). This meant Australia’s ranking grew to 8th place with a ratio of 9.2% compared with the OECD median of 8.1% in 2017. Health spending has been increasing like every wealthy country - because of ageing population, chronic conditions, diseases and risk factors etc. .


The provision of public health services by the states and territory elected governments explains why salaries vary between different geographical areas. Private, “non-salaried medical practitioners” deliver most of the medical, dental and primary care services. Private sector providers include private hospitals, GP and specialist clinics and chemists (pharmacies).


The delivery of healthcare is a hybrid of private and public sector involvement. Simple as that sounds the reality is more complex. Throw in the endless tiers of further local and federal governments, NGOs, private hospitals and you’ve got a potential bunfight of monumental proportions. 


If you’re wondering, as a specialist international medical graduate (SIMG) you can’t work in private practise when you first arrive in Australia.


The providers of public healthcare are your standard medical practitioners, nurses, allied health professionals, hospitals, clinics, government and NGOs etc.


Public hospitals are funded by the federal government and the state and territory governments. However, the management of these is done only by the state and territory government in which the hospital is in unless they are a private institution. There are a number of private hospitals that are contracted to the government to deliver public services. 


Public hospitals provide the vast majority (over 90%) of emergency departments and outpatient services. Private hospitals account for more than 2 thirds of hospitalisations involving elective surgery.All tiers of government contribute to funding and delivering niche services such as indigenous Australian health services, mental health services etc.


The federal government incentivises people to have private health insurance by offering tax rebates. In 2019, 44% of the population had a form of private patient hospital cover, and 53% had some form of general treatment cover.As a specialist in a public hospital/service you get a generous allowance in your remuneration package for treating people who present to the public hospital with private health insurance. This is one reason why substantive job salary packages are comparatively better in Australia than substantive jobs in the UK. 


Contact me if you’re curious about the varying salary levels between the states and territories. You can view current jobs we are recruiting here.



Australian Institute of Health & Welfare.

Medicare Services

Photo by Srikant Sahoo 


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