2026 PBS medicine cover: why a $25 co-payment is not an OSHC limit
Explains why the 2026 PBS co-payment of up to $25.00 is separate from OSHC pharmaceutical limits of $50 per item and $500 a year for single membership.
From 1 January 2026, a patient may pay up to $25.00 for most PBS medicines, or $7.70 with a concession card. This is a patient contribution toward a PBS-subsidised medicine, not a ceiling on an OSHC policy’s contribution: the separate OSHC pharmaceutical limits are $50 per pharmaceutical item and $500 a year for single membership, or $1000 for a family membership. The Pharmaceutical Benefits Scheme (PBS) guidance on patient fees and charges and the Overseas Student Health Cover guidance describe these as separate arrangements.
Checked 1 October 2026.
What does the PBS co-payment represent?
A PBS co-payment is the amount a patient pays toward the cost of a PBS-subsidised medicine. For most PBS medicines, the Australian Government pays the remaining cost, except for brand premiums and certain other allowable charges.
Many PBS medicines cost significantly more than the co-payment. The co-payment therefore should not be read as either the full price of the medicine or the maximum amount an OSHC policy may contribute.
| Arrangement | Amount from 1 January 2026 | What it controls |
|---|---|---|
| General PBS patient co-payment | Up to $25.00 for most PBS medicines | The patient’s contribution toward a PBS-subsidised medicine |
| Concessional PBS patient co-payment | $7.70 with a concession card | The patient’s contribution toward a PBS-subsidised medicine |
| OSHC pharmaceutical benefit | $50 per pharmaceutical item | A separate limit under the OSHC policy |
| OSHC annual pharmaceutical limits | $500 for single membership; $1000 for a family membership | Separate per-year limits under the OSHC policy |
Is the $25 PBS co-payment the maximum OSHC can contribute?
No. The PBS co-payment and the OSHC pharmaceutical benefit answer different questions:
- PBS: How much does the patient contribute toward a PBS-subsidised medicine?
- OSHC: What pharmaceutical benefit applies under the student’s policy, subject to its per-item and annual limits?
The OSHC pharmaceutical limits are not a continuation of the PBS co-payment. A $25 PBS charge does not mean that OSHC has only $25 available, reimburse exactly $25, or automatically cover the remaining medicine cost. Whether a particular expense can be claimed depends on the medicine, the policy terms and how the pharmacy and insurer coordinate the claim.
Can a pharmacist reduce the PBS co-payment?
A pharmacist may provide a discount in some circumstances, but a discount is not guaranteed.
- General patients: The allowable co-payment discount is nil in 2026. Since 1 January 2023, a pharmacist may provide a discretionary increased discount for specific eligible medicines.
- Discount eligibility: The prescription must be an ordinary script for a general patient, and the Commonwealth price must be above $25.00 but below $51.10. Both thresholds are indexed annually on 1 January.
- Concession-card patients: A discount of up to $0.60 may apply to the $7.70 concessional co-payment in 2026. The allowable discount continues alongside the discretionary increased-discount arrangements.
- Exception: The option to discount a co-payment does not apply to an early supply of a specified medicine.
These PBS discounts affect the patient’s PBS charge. They do not replace or increase the separate OSHC pharmaceutical limits. PBS medicine prices can also vary between pharmacies, so comparing prices may be worthwhile.
Does the PBS Safety Net change the OSHC limit?
No. The PBS Safety Net changes PBS patient charges; it does not change an OSHC policy’s pharmaceutical benefit.
From 1 January 2026, the PBS Safety Net threshold is:
| Patient category | 2026 threshold |
|---|---|
| Concession-card patients | $277.20 |
| Other eligible patients | $1,748.20 |
After the threshold is exactly reached or exceeded, general patients pay the concessional rate for further PBS prescriptions during that calendar year, while concession-card holders receive PBS prescriptions at no further charge for the remainder of that year. Eligible expenditure must be recorded on a Prescription Record Form, which may be available from pharmacies or downloaded and printed.
What should you check before relying on OSHC for a medicine?
- Read the policy documents. Check the pharmaceutical benefit definition, per-item limit, annual limit, exclusions and any conditions attached to the cover.
- Check the exact medicine and prescription. PBS availability does not by itself establish that an OSHC policy will reimburse a particular expense.
- Ask how PBS and OSHC claims work together. Confirm with the pharmacist and insurer how the PBS co-payment should be recorded and whether supporting documents are needed.
- Keep receipts and eligible expenditure records. Ask the pharmacist to record qualifying PBS expenditure on the Prescription Record Form so it can count towards the Safety Net.
- Keep your OSHC current. Overseas students on temporary student visas must maintain adequate health insurance during their stay. Tell the insurer if visa status or Medicare eligibility changes, and check the Department of Home Affairs information relevant to your visa.
- Do not treat reciprocal Medicare access as a replacement. Medicare coverage under a Reciprocal Health Care Agreement is additional to OSHC and does not remove the OSHC requirement.
Sources
- What are the current patient fees and charges? | Pharmaceutical Benefits Scheme (PBS)
- Overseas Student Health Cover
FAQ
Is the $25 PBS co-payment the maximum OSHC can contribute?
No. It is a PBS patient co-payment. OSHC pharmaceutical benefits have separate per-item and annual limits, and an exact claim depends on the policy documents and the medicine involved.
Does a PBS-listed medicine automatically qualify for OSHC reimbursement?
Not necessarily. PBS status and OSHC cover are separate. Check whether the exact pharmaceutical item is covered under your policy and how the insurer handles PBS prescriptions.
Is a discount on the PBS co-payment guaranteed?
No. Some discounts depend on eligibility, and the pharmacist may choose whether to provide them. Concession-card patients may have an allowable discount of up to $0.60 in 2026.
Does reaching the PBS Safety Net remove the OSHC pharmaceutical limit?
No. The Safety Net changes the patient’s PBS charges after the relevant threshold is reached. It does not increase or remove the separate limits in an OSHC policy.