Bottom Line: Your schedule fees and rebates rise 2.6% on 1 July 2026. Confirm your billing software updates automatically and review your private and mixed-billing fees, noting that the increase sits below health inflation, so a real-terms gap remains.
Context and Background
Medicare items are indexed each year on 1 July by an indexation factor set by the Government. After an extended period of freezes and low indexation through the 2010s, GP rebates have lagged the real cost of delivering care, and annual indexation has become a closely watched figure for the profession.
This year’s factor is 2.6%. The RACGP has characterised it as “better than a freeze” but inadequate, pointing out that general CPI is running at around 4.2%, health-specific CPI at about 4%, and approved private health insurance premium increases at 4.41%. In other words, rebates are rising, but more slowly than the costs they are meant to cover.
The Change in Detail
What is indexed by 2.6%
- Most general medical services, including standard GP attendance items.
- Most diagnostic imaging services.
- Pathology items in Groups P1, P4, P5, P6, P8 and P12.
What is excluded
- Certain attendance items provided by doctors without vocational registration.
- Positron emission tomography (PET) items.
- Nuclear medicine modifier items.
The real-terms picture
A 2.6% uplift against health inflation of around 4% means the gap between Medicare rebates and the cost of care continues to widen, even with the increase. Indexation-only rises also continue to fall further behind the AMA’s recommended fees, which is part of why mixed and private billing models exist. The practical takeaway is that 2.6% should be treated as a floor for any fee review, not a ceiling.
It arrives with other 1 July changes
The indexation lands on the same day as a batch of new and amended MBS items, and the new assignment of benefit process that commences 1 July 2026. It is worth treating all three as a single mid-year billing update rather than separate tasks.
Clinical and Practical Implications
For bulk-billing services, the rebate uplift flows straight through to the practice with no decision required, beyond confirming the software is current. For mixed and private billing, the indexation prompts a choice: pass on the 2.6%, or set a larger increase that better reflects the cost gap. Because health costs are rising faster than the indexation factor, a practice that simply mirrors 2.6% each year will steadily go backwards in real terms.
Patients on private fees may notice small increases, and front-of-house staff should be briefed so that updated fees are quoted accurately from 1 July. Most clinical and billing software vendors apply the new schedule automatically, but the responsibility to verify the correct fees are loaded rests with the practice.
What You Need to Do
- Confirm your clinical and billing software updates to the 1 July 2026 schedule before you bill on that day.
- Review your private and mixed-billing fee structures and decide your own uplift, rather than defaulting to 2.6%.
- Update any hard-coded fees in templates, accounts, signage and patient information.
- Brief reception and billing staff on the new fees applying from 1 July 2026.
- Coordinate the change with the new assignment of benefit process and any new items you bill from the same date.
Summary
- Most MBS rebates rise by 2.6% from 1 July 2026.
- The uplift covers most general attendances, most diagnostic imaging, and pathology Groups P1, P4, P5, P6, P8 and P12.
- Excluded: certain non-vocationally-registered attendance items, PET items, and nuclear medicine modifier items.
- The factor sits below CPI (around 4.2%) and health CPI (around 4%), so a real-terms gap remains.
- Bulk-billing practices receive the uplift automatically; mixed and private billers should review fees deliberately.
- The change coincides with new MBS items and the new assignment of benefit process from the same date.
Sources: MBS Online July 2026 news; RACGP response to MBS indexation. General educational information for registered medical professionals; confirm the indexed fees for the specific items you bill on MBS Online from 1 July 2026.
