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Manage health costs in retirement

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Planning ahead can help you manage health costs as you get older.

Ways to manage health costs in retirement

Health needs and costs can change over time. Medicare and public health services cover many types of care, and government programs and concession cards may help reduce some day-to-day costs.

You may still need to pay for some appointments, treatments, medicines and health aids. Knowing what’s covered, and where you have costs of your own, can help you plan ahead.

What health costs does Medicare cover?

Medicare covers or helps with the cost of many health services. What you pay can depend on the service, the provider and whether they bulk bill. You can find out more about medical costs and Medicare.

GP, specialist and allied health costs

Common health costs may include:

Use the Medical Costs Finder to compare typical out-of-pocket costs for GP and specialist services. You can also ask your provider for an estimate before treatment.

Hospital costs

If you have a Medicare card, your care in a public hospital is generally free when you’re admitted as a public patient. 

As a public patient, you generally cannot choose your doctor. How long you wait for non-urgent treatment will depend on your medical needs and the hospital.

If you choose treatment as a private patient, you may have costs that Medicare and private health insurance don’t cover. These can include hospital charges and fees from doctors involved in your treatment.

Before receiving private treatment, ask the hospital and doctors for written estimates. You can also ask your insurer what your policy covers and what you may need to pay.

Medicine costs

The Pharmaceutical Benefits Scheme (PBS) subsidises many prescription medicines. This reduces the amount you pay for medicines listed on the scheme.

If you spend enough on PBS medicines in a calendar year, you can apply for a PBS Safety Net Card which makes additional scripts even cheaper or free.

A Pensioner Concession Card may also reduce medicine costs and give you a lower PBS Safety Net threshold.

The Australian Government has also introduced measures to keep medicine costs down, including freezing the maximum patient cost for PBS medicines and expanding access to 60-day prescriptions. Read more about cheaper medicines.

Some people with an ongoing health condition can receive a 60-day supply of certain PBS medicines with one prescription. This may reduce the number of visits to the pharmacy and the amount spent on dispensing fees. Find out more or speak to your prescriber.

Dental, eye and hearing costs

Medicare does not cover every dental, eye or hearing service. You may need to plan for some or all of these costs.

Find out more about support from other free government health programs and other support.

Mental health costs

Medicare can help with the cost of some mental health services, including visits to your GP and eligible mental health professionals. 

Providers set their own fees. If they don’t bulk bill, you may have to pay a gap. Asking about fees and rebates before an appointment can help avoid unexpected costs.

You can also contact Medicare Mental Health for free and confidential support. You do not need a Medicare card, referral or Mental Health Treatment Plan to access the service. Call 1800 595 212 or visit Medicare Mental Health for more information.

Anne finds free mental health support

After moving to a new area, Anne started feeling low and had trouble sleeping. She called Medicare Mental Health and was connected with a local Medicare Mental Health Centre. 

Anne spoke with a mental health nurse about what was happening and some practical ways to cope. The service was free and she did not need a Medicare card.

Private health insurance in retirement

Whether private health insurance offers value in retirement depends on your health needs, the cover you want and what you can afford.

You do not need private health insurance to use Medicare or receive treatment as a public patient in a public hospital.

Private health insurance may help with costs that Medicare does not fully cover, including:

It may also give you more choice about your doctor and hospital and may allow you to be treated sooner as a private patient.

However, private health insurance does not cover every cost. You may still have an excess, co-payment or gap fee.

If you already have private health insurance, it may be worth reviewing whether the cover still matches your needs and budget.

Find out more about the types of health insurance cover available.

How can I plan for health costs in retirement?

Health costs can be hard to predict. Allowing some flexibility in your budget can help you manage both regular expenses and unexpected costs.

When considering treatment, it can help to:


You can talk to your doctor about:

Depending on your age and circumstances, these services many include:

You may also want to:

Key actions you can take