Hi Mez
The threshold is works on your out-of-pocket costs. That's the difference between what medicare gives you back and what you actually pay. So say your GP charges you $80 for a general visit, then you go to Medicare who give you back 85% of the scheduled fee for a visit which is $37.15 so you get back $31.60 from medicare and the remaining $48.40 is your out-of-pocket cost. It's this $48.40 that counts to your threshold.

The same principle works with something like an IVF cycle - I paid $4711.95 for an IVF cycle. The scheduled fee was $1730.30 - so my out of pocket expense was about $3242 by the time I got 85% of my $1730 back from medicare. This out of pocket is above the threshold of $1000. So then I get 80-% of $2242 (which is $3242 less $1000 of the threshold) back from Medicare once I register for the safety net. Then anything else for the whole calendar year I also get 80% of the total fee I pay back for the year.

Hope that makes sense?

Oh and it is only for out-of-hospital costs. So things like anaesthetic fees don't count. You need private health insurance to cover those.

If you have private health insurance then you have to add back in what you PHI gives you back to what you get back from medicare. So it takes longer to get to the threshold.