Specialist fee crackdown: Could caps bring down medical bills?

The cost of seeing a specialist has soared in Australia, leaving almost two million people delaying or going without care and prompting calls for tougher action on excessive doctors’ fees.

The Federal Government is considering reforms including fee caps, incentives for specialists to bulk bill or charge lower out-of-pocket costs, and greater scrutiny of doctors whose fees are substantially higher than their peers.

The Government’s consultation paper on excessive specialist fees shows the average out-of-pocket cost for an initial specialist consultation rose from $95 in 2016 to $159 in 2025 — that’s an increase of 67 per cent. Over the same period, the Consumer Price Index rose about 32 per cent.

For privately insured Australians, in-hospital gap payments increased 72 per cent between 2019 and 2025, with the median medical gap reaching $323 per episode last year. More than 1.9 million Australians delayed or did not see a specialist because of cost during 2024-25.

How much is too much?

The Government is now grappling with where to draw the line on excessive fees with the disparity between what patients can be charged for the same treatment can be enormous.

Private Healthcare Australia (PHA), the peak body representing health insurers, says its data shows the median fee for a knee replacement in 2024-25 was $1,080, yet 10 per cent of patients were charged more than $5,300.

Government figures show that in 2025 more than 260,000 in-hospital specialist services attracted fees greater than five times the median. Another 450,000 were charged at between three and five times the median.

The Government’s consultation, which opened on September 9, will help determine how an “excessive” specialist fee should be defined and what action could be taken.

Fee caps among options on the table

One option is setting limits on what specialists can charge for individual Medicare services, potentially using the Medicare Benefits Schedule fee, median fees or upper fee percentiles as benchmarks.

Other proposals include incentives for specialists who bulk bill or keep patient gaps down, publishing the point at which a fee is considered excessive and strengthening requirements for patients to be told about costs before treatment.

Doctors who routinely charge unusually high fees could also be shown how their charges compare with their peers, while more serious cases could be referred for independent assessment.

PHA chief executive Dr Rachel David welcomed the focus on unusually high charges but said the problem extended beyond a small number of doctors.

“Excessive fees are the sharpest edge of a much broader affordability problem: specialist fees and gaps across the market have been creeping up much faster than inflation for years,” Dr David said.

“If Australians cannot afford the specialist consultation, diagnostic work or medical gap needed to access private treatment, they may delay care or fall back on already stretched public hospitals.”

Doctors say there’s another side

The debate, however, is more complicated than blaming doctors for rising bills.

The Australian Medical Association has been campaigning on the widening “Medicare Gap”, arguing that years of inadequate funding and freezes in Medicare rebates have contributed to rising out-of-pocket costs.

The AMA says Medicare funding for specialist consultations has fallen behind the cost of delivering care and has warned against portraying doctors as the sole cause of increasing medical bills.

That leaves the Government balancing the need to protect patients from extreme bills against the risk of making specialist care harder to access.

PHA has also warned against poorly designed caps becoming a new pricing benchmark.

Before you see a specialist

If your GP refers you to a specialist, ask whether there are other specialists providing the same service at a lower cost.

Before booking, ask what the consultation will cost, how much Medicare is expected to rebate and what your likely out-of-pocket expense will be.

For surgery or hospital treatment, request a written estimate of expected medical fees and check whether the doctors involved participate in your health fund’s no-gap or known-gap arrangements.

The Government’s Medical Costs Finder can also show typical costs for common specialist services and procedures.

The consultation remains open until October 19.

For millions of Australians facing increasingly expensive medical care, what happens next could affect the bill they receive the next time their GP says: “I’d like you to see a specialist.”

ALSO CHECK OUT Over 5 million extra doctor visits bulk billed since game changing incentives introduced