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Credit vs Layby Surgery

There are many ways to pay for surgery in Australia today but credit is rarely the best option…

Before you decide to undergo any elective surgery, you need to ask yourself many questions: ‘How much will it cost’ is one of the most important.

Unfortunately, the answer is often much more than you expect and much more than you can probably afford.

It also inevitably leads to another equally important question: ‘How are you going to pay for it?’

In Australia we are lucky to have access to world-class medical facilities and staff, but that access isn’t always free.

The cost of any elective surgery normally includes the surgeon’s fee, the anaesthetist’s fee, hospital accommodation fees, operating theatre fees and pathology/imaging fees – and some of these may need to be paid upfront.

So, how will you pay for your surgery?

Will Medicare pay for my surgery?

Many people believe Medicare pays the cost of all surgery and procedures performed in Australian public hospitals, but this is simply not true.

Medicare will pay for your treatment if you’re badly hurt or sick and are admitted as a public patient in a public hospital. It will also pay for the treatment of any non-urgent medical conditions such as knee and hip replacements if you’re admitted as a public patient in a public hospital.

However, Medicare will NOT pay for medical and hospital services which aren’t clinically necessary.

This means Medicare will cover critical reconstructive surgery but will NOT cover cosmetic surgery.

In other words, Medicare will pay for rhinoplasty to restore breathing function and breast reconstruction after a mastectomy but won’t pay for rhinoplasty to smooth a bump or breast augmentation to increase cup size.

There are however a few exceptions to this ‘rule’ as some cosmetic procedures can, in certain circumstances, be deemed medically necessary and therefore qualify for Medicare rebates (e.g., skin removal surgery after weight loss).

Will private health insurance pay for my surgery? 

Private Health Insurance helps pay the costs of the same medical treatments that Medicare funds.

‘Hospital cover’ policies also enable patients to choose their own surgeon, hospital (public or private) and procedure date.

However, the benefits provided by individual policies vary greatly so it is essential for policy holders to check if their planned procedure is covered, and what rebate, if any, they are eligible for, before booking.

What procedures do Medicare and Health Insurance pay for?

All services covered by Medicare and Private Health Insurance are listed in the Medicare Benefits Schedule (MBS).

If the surgery you want does not have a Medicare Item Number, it will NOT be covered by Medicare OR Private Health Insurance.

Can I pay for surgery with credit?

Yes, you certainly can – but that doesn’t mean you should.

While it is true, that credit is now readily available to us all, it is essential to think carefully before choosing any ‘Buy Now – Pay Later’ option.

The sad reality that many of us have learned the hard way is that credit could be more aptly described as the ‘Buy Now – Pain Later’ option.

Nonetheless, sometimes credit may be your only funding choice, particularly if you need surgery for a painful condition asap and can’t tolerate remaining on the public hospital waiting list any longer.

If you are in such a situation, it is important to carefully evaluate your funding options and choose the best one for your circumstances – i.e., ‘Think Now – Minimise the Pain Later’.

The three main credit options currently available in Australia for medical and cosmetic surgery are:

  1. Credit cards
  2. Personal Loans
  3. BNPL platforms (AfterPay and Zip)

Can I pay for surgery with a credit card? 

Although credit cards are readily accessible to almost all Australians over 18, they should be considered a last resort for funding a large ‘purchase’ like surgery for two main reasons: High interest rates and the Minimum Monthly Payment.

The high interest rates (the average rate is currently slightly over 19 percent) are an obvious concern, yet in many ways the Minimum Monthly Payment option (usually 2-3 per cent of the outstanding balance) is potentially an even bigger danger as it can result in some users having to pay ‘interest on interest’ for years.

For example, according to moneysmart.gov.au, if a credit card user chose to only pay the Minimum Monthly Payment on a $10,000 debt (19 per cent interest) they would take 51 years and one month to pay off their debt – and end up paying a whopping $42,779!

In addition, credit cards may also charge application fees, annual fees, and late payment fees.

Can I pay for my surgery with a BNPL?

BNPLs are instalments-based payment platforms used to purchase goods and services.
Currently, the two best known BNPLs in Australia are AfterPay and Zip.


AfterPay allows users to pay for purchases in four interest-free instalments over six weeks.

The payments are interest-free but there are fees for late payments.

AfterPay gives each user a spending limit, however the maximum transaction amount is currently $1500 while the outstanding account limit is $2000.


Zip offers users two payment options – ZipPay and Zip Money

ZipPay allows users to make interest-free purchases up to $1000 with no upfront fees and the flexibility to choose weekly, fortnightly, or monthly repayments.

The service does however charge a monthly account fee unless the user pays their statement closing balance by the due date.

ZipMoney enables users to make purchases from $1000 to $3000 (up to $50,000 at some merchants) interest-free for three months.

At the conclusion of the interest free period, interest is charged at the standard annual percentage rate, currently19.9 per cent.

Users, who pay a one-off establishment fee, can make repayments weekly, fortnightly, or monthly and must also pay a monthly account fee unless they have nothing owing.

Can I pay for surgery with a Personal Loan?

There are many banks and finance companies willing to lend money for people to pay for surgery in Australia.

On the positive side, personal loans are available for large amounts of money and can be paid over varying time periods (normally from one to 10 years) with flexible repayment options (weekly, fortnightly or monthly).

However, loans are never interest-free and interest rates vary wildly (currently from around 5 percent to 17 percent) depending on whether your loan is secured or not, your loan period, and other factors.

In addition, loan providers may also charge establishment fees, service fees, late payment fees and even early termination fees.

Can I pay for surgery with layby?

As you can see there are many credit options available to pay for surgery in Australia.

Unfortunately, none of them are ideal.

Despite the inevitable happiness that life-changing surgery can bring, the burden of having to pay for ‘a new nose’ or knee replacement for years afterwards is a painful side-effect.

Fortunately, there is a better option for those who haven’t got cash to pay upfront: Layby

Yes, Layby.

Layby Surgery offers patients the option of using one of Australia’s oldest and most trusted payment methods to pay for surgery UPFRONT.

That’s right. You can pay for your surgery week by week, or month by month – in the same way that your mum most likely paid for many Xmas gifts for you over the years or you may have paid for your first TV, holiday or sofa.

Layby Surgery was founded on the belief that life-changing surgery should be accessible to everyone and that no one should have to go into debt paying for it.

The company therefore offers patients the same benefits that ‘traditional’ layby services, which are still used in retail outlets across the country, offer shoppers – plus a few extras.

This means that you can now visit Layby Surgery to search for the surgery you want, choose a surgeon, estimate the total cost, and then calculate how long it will take you to pay it (weekly, fortnightly or monthly).

You can then confidently book a consultation with your surgeon and book your procedure date knowing that you will have one less worry on your big day – your surgery and all associated costs will be paid for before you have been wheeled into the operating theatre! 



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