Every day, millions of Australians come into contact with the health system. It may be through health promotion and disease prevention programs such as school-based vaccinations; an appointment with a general practitioner (GP); a visit to the pharmacist to pick up a prescription; or a more complex interaction, such as being admitted to hospital for surgery. A key role of the health system is to respond to these individual needs by providing safe, effective, accessible and appropriate treatment and other services.

Australia’s health system is a complex mix of service providers and other health professionals from a range of organisations—from Australian and state and territory governments and the non-government sector. Collectively, they work to meet the physical and mental health care needs of Australians.

The complex structure of Australia’s health system is reflected in its funding arrangements. The health system is funded by Australian and state and territory governments as well as non-government funders such as private health insurers and individuals. See Health expenditure for more information.

Who is responsible for the health system?

The Australian and state and territory governments broadly share responsibility for funding, operating, managing and regulating the health system. The private for-profit and not-for-profit sectors also play a role in operating public and private hospitals, pharmacies and medical practices, as well as providing private health insurance products.

Health services are delivered by a range of health professionals working in a variety of settings, from large hospitals (in capital cities and regional centres) to small health clinics (including in remote areas). Australia’s health workforce includes GPs, surgeons and other medical specialists, nurses and midwives, dentists, allied health practitioners including Indigenous health workers, paramedics and administrative and other support staff. See Health workforce for more information.

A variety of organisations support health services. Health departments and other agencies are responsible for policy and service planning. Research and statistical organisations collect and publish information on the performance of the health system, health conditions and issues. Universities and health services train health professionals. Consumer and advocacy groups have a role in public debates on policies and regulation. Voluntary and community organisations also provide support directly to individuals as well as through activities like fundraising for research and awareness raising through health advocacy programs.

Role of government

Australian health ministers work together to shape Australia’s health system through the Council of Australian Governments (COAG) Health Council—a forum for cooperation on health issues to improve health outcomes and ensure the sustainability of the health system (COAG 2014).

Australian Health Performance Framework

In 2017, the Australian Government with the states and territories agreed to the Australian Health Performance Framework (AHPF)—a vehicle to support system-wide reporting on Australia’s health and health care performance (COAG 2017).

In December 2019, the AIHW released the AHPF ‘National front door’ and indicator reporting platform, which serves as a navigation tool to access data on the health of Australians and the performance of the health system. AHPF indicators will be updated as new data become available. AIHW is leading a program of work to develop new indicators under the AHPF.

The main roles of each level of government in Australia’s health system are described below (Biggs & Cook 2018; Department of Health 2019; Duckett & Willcox 2015).

The Australian Government:

  • develops national health policy
  • funds medical services through Medicare and medicines through the Pharmaceutical Benefits Scheme (PBS)
  • provides funds to states and territories for public hospital services
  • funds population-specific services, including community-controlled Aboriginal and Torres Strait Islander primary health care, health services for veterans, and residential aged care
  • funds health and medical research
  • regulates medicines and medical devices
  • supports access to and regulates private health insurance.

State and territory governments:

  • fund and manage public hospitals
  • regulate and license private hospitals and other health premises, and regulate products with health impacts such as alcohol and tobacco
  • deliver community-based and preventive services (for example, cancer screening and immunisation), ambulance services, and services to address complaints against any of these.

Local governments in some jurisdictions can be involved in:

  • delivery of community and home-based health and support services
  • environmental health services (for example, waste disposal, water fluoridation)
  • public health activities.

Additionally, all levels of government have shared responsibilities, including education and training of health professionals, regulation of the health workforce, food standards and safety, improving the safety and quality of health care and funding of programs and services (Biggs & Cook 2018; Department of Health 2019; Duckett & Willcox 2015).

What services are available?

Many services are required to meet the health needs of Australians and deliver a high-quality health system. These include:

Most people have exposure to preventive health measures across their life, from educational campaigns to free vaccines. People utilise health services as needed, dependent on their health needs and personal circumstances. Some may visit a pharmacy or GP infrequently; some may have regular appointments with a GP, specialists or other health practitioners; others may go to hospital for tests, treatments or emergencies.

Medicare

Australia’s health system is underpinned by Medicare—a universal health insurance scheme. Medicare pays rebates for medical services and procedures provided by private practitioners in the community such as GPs and other medical practitioners, and Medicare ensures Australians have access to free hospital services for public patients in public hospitals and a range of prescription pharmaceuticals subsidised under the PBS (Biggs 2016). Medicare is funded by the Australian Government through taxation revenue, including a Medicare Levy and Medicare Levy Surcharge (ATO 2019a). See Medicines, Specialist pathology and other diagnostic services and Allied health and dental services for more information.

Medicare is currently available to Australian and New Zealand citizens, permanent residents in Australia, and people from countries with reciprocal agreements (Department of Health 2019). Most people outside these categories have to pay full fees for health services or take out private health insurance (PrivateHealth 2019).

Private health insurance

Some medical and allied health services are not subsidised through Medicare. For example, Medicare does not usually cover costs for ambulance services, most dental services and optical aids (such as glasses and contact lenses). For these services, private health insurance is 1 option for managing these health care costs (Lewis & Willis 2018). Private health insurance can also give people with cover the option to avoid waiting lists in the public system and the ability to choose their own doctor (Biggs 2018).

The Australian Government offers a means-tested rebate to people who hold private health insurance, and imposes the Medicare Levy Surcharge on higher-income earners who do not have a particular form of private health insurance—the intent is to encourage people to take up private health insurance to reduce pressure on the publicly funded system (ATO 2019b).

See Private health insurance for more information.

Hospitals

Hospitals are an important part of the health system, providing a range of services to many people. Australians admitted to public hospitals are guaranteed access to fee-free treatment as public patients. Funding of public hospital services is managed through intergovernmental agreements between the Australian Government and state and territory governments (Boxall 2014). These agreements specify the arrangements by which the Australian Government transfers funds to the states and territories to support public hospitals as well as how public hospital funding is managed more broadly. The current National Health Reform Agreement outlines an ‘activity based’ system whereby Australian Government funding is based on the estimated cost of the activities performed in each hospital.

See Hospital care for more information.

Where do I go for more information?

For more information on the health system, see:

References

ATO (Australian Taxation Office) 2019a. Medicare levy. Canberra: ATO. Viewed 21 October 2019.

ATO 2019b. Private health insurance rebate. Canberra: ATO. Viewed 5 November 2019.

Biggs A 2016. Medicare: a quick guide. Canberra: Department of Parliamentary Services. Viewed 21 October 2019.

Biggs A & Cook L 2018. Health in Australia: a quick guide. Canberra: Department of Parliamentary Services. Viewed 21 October 2019.

Boxall A 2014. Explainer: what is Medicare and how does it work? Melbourne: The Conversation. Viewed 21 October 2019.

COAG (Council of Australian Governments) 2014. COAG Health Council. COAG Health Council 2014 Terms of Reference. Canberra: COAG. Viewed 5 November 2019.

COAG 2017. COAG Health Council. The Australian Health Performance Framework. Canberra: COAG. Viewed 21 October 2019.

Department of Health 2013. Health workforce: background. Canberra: Department of Health. Viewed 5 November 2019.

Department of Health 2019. The Australian health system. Canberra: Department of Health. Viewed 5 November 2019.

Duckett S & Willcox S 2015. The Australian health care system. 5th edn. South Melbourne: Oxford University Press.

Goddard M 2014. How the Pharmaceutical Benefits Scheme began. The Medical Journal of Australia. Viewed 9 October 2019.

Lewis S & Willis K 2018. Do you really need private health insurance? Here’s what you need to know before deciding. Melbourne: The Conversation. Viewed 5 November 2019.

PrivateHealth 2019. Overseas visitors and overseas students. Canberra: Private Health Insurance Ombudsman. Viewed 5 November 2019.