Whether you're undergoing a planned surgery or facing an unexpected hospital stay, understanding the potential costs can help you avoid nasty surprises. What you'll pay depends on where you're treated, whether you're admitted as a public or private patient, and whether you have private health insurance.
What is the cost of staying in a public hospital?
Thanks to Medicare, public hospital treatment in Australia is free to Australian and New Zealand citizens, most permanent residents, and those from countries with reciprocal agreements.
Receiving treatment in a private hospital may let you skip long waiting lists for elective surgeries and offer a better experience, but will come at a cost, which can be high. This is where private health insurance comes in.
What is the cost of staying in a private hospital?
When you’re treated in a private hospital for a procedure covered by your health insurance, there are two main costs to look out for: your excess and your gap payment.
- The ‘gap’
The difference between what your doctor charges and what Medicare and your health insurer will cover. If your doctor charges more than what’s covered, you may need to pay the remaining balance yourself. - Your excess
A set amount you pay towards your hospital costs, which is outlined in your policy documents. You may also need to make a co-payment for each day you’re admitted instead of, or in addition to, your excess. If your health fund doesn’t have an agreement with your hospital, you could face significant out-of-pocket costs.
Before you book in for private treatment, it may be worth reading your Private Health Information Statement (PHIS) to understand your cover and contacting your health fund to check which doctors they have agreements with.
Staying in a public hospital as a private patient
If you’re admitted to a public hospital, you may be asked if you would like to be registered as a private or a public patient. If you choose to be a private patient, you may receive additional benefits such as access to a single room and your choice of doctor (provided they’re available).
The cost of staying in a public hospital as a private patient is the same as the cost for staying at a private hospital. Clarifying how far your cover stretches and the costs charged by the hospital for a private patient can help you determine if you’ll be out of pocket.
What does Medicare cover in public hospitals?
Medicare covers costs of public hospital services for public patients in Australia, including:
- Clinical services
- Doctor and specialist fees
- Accommodation and food (usually shared rooms)
- Medication prescribed in hospital
- Operating theatre fees
It’s worth noting procedures covered by Medicare must be listed on the Medicare Benefits Schedule (MBS).
What costs doesn’t Medicare cover?
There are some hospital-related expenses that Medicare may not cover, such as the cost of ambulance services. Depending on where you live, your state or territory government may cover this.
For example, the ambulance service in Queensland is fully subsidised by the Queensland Government, making it free for residents, whereas in Victoria, residents who use the service may be out of pocket unless they have an Ambulance Victoria membership, a concession entitlement, or a health insurance policy that provides cover for ambulance services.
Other states and territories have varying policies, so it is important to check local ambulance service coverage.
Additionally, while public hospital treatment is free for public patients, some minor charges may apply, such as optional services like TV, internet, telephone, and parking fees, which are typically not covered.
How to prepare for the costs of staying in hospital
If you’re planning an admission to a private hospital, it’s a good idea to check with your doctor or the hospital administration staff about the cost of your stay. Some of the costs to consider include:
- Intensive care
- Hospital accommodation
- Operating theatre fees
- Medication, dressings, and bandages
- Blood tests, X-rays, or CT scans
- Specialists’ fees
It may also be valuable to talk with your health fund to understand what you’re covered for, and to check which doctors and hospitals they have existing agreements with. Consider asking about any waiting periods, exclusions, co-payments, or excesses that may apply. If you’re not happy with the level of cover you have, you can always compare health insurance policies on Canstar’s database.
How much does day surgery cost?
Data from the Australian Prudential Regulation Authority (APRA) shows that Australians with private health insurance paid an average of $511 out of pocket for each hospital visit in the March quarter of 2026. This includes costs like medical gap payments and any excess or co-payments related to hospital accommodation.
The total cost of day surgery varies depending on the procedure and whether or not you’re being treated as a public or private patient:
- Public patients: If your procedure is included in the MBS and you’ve been admitted as a public patient in a public hospital, Medicare will cover the cost fully.
- Private patients: Medicare may cover 75% of the MBS fees, with your private health insurance typically covering some or all of the remaining cost. How much your insurer will cover will depend on your level of private health insurance.
Common day surgeries include cataract removal, tonsillectomy, colonoscopy, and arthroscopy. Costs in private hospitals for these procedures can vary significantly, depending on complexity and location.
How to estimate your hospital costs
If you have a hospital stay planned, it can be comforting to get an estimate of your likely costs before you're admitted. While it’s not always possible to know the exact amount you'll pay, asking a few questions upfront can help you avoid unexpected costs.
Here are a few ways to get a clearer idea of your hospital costs:
- Ask your specialist for an estimate of their fees and whether or not there will be any other doctors involved in your care, as the likes of an anaesthetist or assistant surgeon may charge separately.
- Contact your health insurance provider to check what your policy covers, whether you'll need to pay an excess or co-payment, and if any waiting periods apply.
- Speak with your hospital about accommodation costs and any fees you may be responsible for during your stay.
- Ask about gap payments, including whether your doctors are a part of your health fund's gap cover scheme. If they are, it could reduce your out-of-pocket costs.
Keep in mind that emergency treatment or unexpected complications can affect your final bill, so an estimate may differ from the amount you ultimately pay.
Is hospital cover worth it?
Whether it’s worth taking out hospital cover ultimately depends on your personal health needs, budget, and circumstances. Hospital cover can help reduce your out-of-pocket costs if you’re treated as a private patient in a public or private hospital (depending on your policy), and can mean shorter wait times for certain elective procedures, as well as choice of doctor.
Having an appropriate level of private health insurance can also help when it comes to tax time. Depending on your income, you may benefit from the Australian Government’s Private Health Insurance Rebate, making it more affordable to hold the private hospital cover needed to avoid the Medicare Levy Surcharge (MLS). For the 2026/27 tax year, the MLS generally applies if you earn over $105,000 a year as a single or $210,000 as a family (plus $1,500 for each dependent child after your first). However, if you have hospital cover with an excess of $750 or less as a single person, or $1,500 or less as a family, you may avoid paying the MLS entirely.
