Key points
- Australia runs universal public health insurance — Medicare, established in 1984 — funded through general taxation and an income-based levy.
- Public insurance coverage is 100% of the population; about 55% also hold private insurance (Commonwealth Fund).
- Medicare covers the full cost of public hospital services and some of the costs of other health services; private insurance pays for private hospital care, dental and other extras.
- Government spending was 74% of total health expenditure in 2023–24 (Commonwealth Fund).
- Life expectancy at birth was 83.0 years in 2023, and health spending was 10.3% of GDP (OECD Health at a Glance 2025).
Direct answer: Australia runs universal public health insurance — Medicare, established in 1984 — funded through general taxation and an income-based levy. Medicare covers all Australian and New Zealand citizens, permanent residents, and people from countries with reciprocal agreements. It covers the full cost of public hospital services and some of the costs of other health services. Public insurance coverage is 100% of the population, and about 55% also hold private insurance. Life expectancy at birth was 83.0 years in 2023, and health spending was 10.3% of GDP (OECD Health at a Glance 2025).
At a glance
| Item | Detail |
|---|---|
| Model | National health insurance — Medicare, regionally administered |
| Who pays | General taxation plus an income-based Medicare levy |
| Who delivers | Public hospitals run by states and territories; private providers and GPs, with free choice of GP |
| What is free at the point of use | Public hospital care; GP visits that are bulk-billed; other services subsidised rather than free |
| Life expectancy at birth | 83.0 years (2023, OECD Health at a Glance 2025) |
| Health spending | 10.3% of GDP (OECD Health at a Glance 2025 country note); $7,469 per person (USD PPP) |
| Source for the model and coverage | Commonwealth Fund — Australia country profile (data as of February 2026) |
Figures are a snapshot checked 7 November 2026, not a live feed. No country is ranked as best.
How the system works
Medicare is Australia’s publicly funded health care system. It was established in 1984, replacing an earlier universal scheme, and it is primarily funded through general taxation and an income-based levy. Enrolment is automatic for citizens. Medicare covers all or part of most medical treatments, under the Medicare Benefits Schedule, which sets the government’s recommended fee for each service, and the Pharmaceutical Benefits Schedule, which subsidises the cost of many medicines.
Public hospitals are run by the states and territories, and eligible patients receive care there free of charge. GPs work mostly in private practice, and patients have free choice of GP. Medicare covers the full cost of public hospital services and some of the costs of other health services — preventive care, inpatient and outpatient care among them. Some migrants, refugees and humanitarian entrants also have access to Medicare, depending on their visa; others must obtain private health insurance.
Who pays, and what people pay
Government spending accounted for 74% of total health expenditure in 2023–24 (Commonwealth Fund). Funding for Medicare is raised by a Medicare levy on taxable income, on top of general taxation. When a GP bulk-bills, Medicare pays the full fee and the patient pays nothing for that visit; when a GP does not bulk-bill, the patient pays the gap between the fee and the Medicare benefit. A Medicare safety net caps out-of-pocket costs for non-inpatient services once a household passes a threshold, and a separate pharmaceutical safety net does the same for medicines.
What is free, and what is not
Free at the point of use: public hospital care, and GP visits that are bulk-billed. Subsidised: most medical treatments, and many medicines under the Pharmaceutical Benefits Schedule. Mostly not covered by Medicare: ambulance services, most dental care, glasses, contact lenses and hearing aids, and cosmetic surgery. Most of these are covered under private health insurance, or by state and territory governments. About 55% of the population holds private insurance — mainly for private hospital care and those extras — and tax surcharges encourage people to hold it.
How it compares
Australia spends 10.3% of GDP on health — above the OECD average of 9.3% — and $7,469 per person, more than the OECD average of $5,967 (USD PPP). Its life expectancy of 83.0 years is 1.9 years above the OECD average of 81.1 years (OECD Health at a Glance 2025). Its distinguishing feature in this set is the deliberate public-private mix: a universal public system with full public hospital cover, sitting alongside a large private insurance market that the tax system actively encourages. Compare countries side by side in the Health System Comparison tool, or read the other profiles in the country index.
Frequently asked questions
Is Australian healthcare free?
Public hospital care is free under Medicare, and many GP visits are bulk-billed, meaning Medicare pays the full fee. Other services are subsidised rather than free, and dental care, glasses and hearing aids are mostly paid for privately or through private insurance.
Do Australians need private health insurance?
No. Medicare covers everyone eligible. About 55% of the population also holds private insurance, mainly for private hospital care and extras such as dental; tax incentives encourage higher earners to hold it.
What is bulk-billing?
Bulk-billing is when a GP or other provider bills Medicare directly and accepts the Medicare benefit as full payment, so the patient pays nothing for that visit. Not all providers bulk-bill, and rates vary by area.