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Even though the Australian government provides health care for citizens and permanent residents, there are always going to be costs involved with the health system. These costs differ depending on circumstance, individual earning power, and choice. However, in comparison to other health systems around the globe, Australia provides quite a solid health care program, even though it does have its share of flaws.

The Australian government provides Medicare to the people of Australia, which is a limited health care scheme that was introduced in 1984. Basically, the scheme covers 100 percent of the health bills when using public hospital services, provides 85 percent coverage for general practitioner fees, and 75 percent for some specialised services. Most people pay GP fees up front, and then visit the local Medicare centre for reimbursement at a later time. For instance, a short visit to the GP may cost around $60. When payment is made by the patient, they can then be reimbursed about $50 from Medicare.

But what costs are involved to implement this scheme? A majority of the Medicare payments come out of the Federal Budget. However, Medicare is also funded through a federal income tax levy of between one and two percent. For higher income earners without private health insurance, this income tax levy can be as high as 2.5 percent. For Australians that fall within the low income earner bracket, the income tax levy is set below one percent.

Even though Medicare does provide a broad and reputable health service for local Australians, the private health sector has continued to expand over the past few decades. This is largely due to substantial waiting queues that have developed in the public sector, more specialist services in private hospitals, and more experienced doctors in the private sector.

Comprehensive health insurance costs depend on the individual. However, average private health cover in Australia costs between $850 and $1200 per person per year. This roughly equates to a monthly fee of between $70 and $100 per month. Like all insurance companies, the cost of the policy is relative to the individual. For example, policy holders in their 50's will incur a great health insurance cost than a healthy individual in their early 20's. Most insurance companies provide extras for customers, not to mention plenty of choice when it comes to coverage.

Medibank Private is the leading health insurance company in Australia, with over three million clients per year. It is actually owned and operated by the government of Australia, but was recently recognised in 2009 as a profit organisation, meaning profits made are now taxable. There are plenty of other insurance companies offering health coverage, such as Bupa and IMAN Health.