Same way Canadian doctors make their money. Accept the government payment as 100% of their payment for the consult/surgery, instead of supplementing the cost by charging the patient out of pocket or charging the insurance company extra.
Yes, that's why the Australian health system is lucrative for doctors. Its a mixture of the Canadian and American health systems.
All medical procedures attract a medicare fee which is paid by the government. The doctor then decides whether or not they will accept this as the full payment for the consult/procedure (if the patient is in a public hospital, this is by default the full payment) however in a private consultation/hospital the doctor can decide to charge extra on top - and this can be payable by the patient (out of pocket) or by the patient's private insurance (if they have any).
The advantage of this to the doctor is they can keep charges in line with inflation, and see fewer patients for a given amount of income.
There are doctors who still operate purely bulk billing, but most operate on a combination of the above. For example they bulk bill pensioners and students, and have an extra charge for the rest of their patients.
how does this affect the overall cost of health care to the nation and are australians happy with this arrangement? at the same time, i think that canada is moving towards a more mixed model like australia. recently in quebec, physicians were allowed to charge out of pocket for procedures. this si not permitted under the health act, but the federal government has done nothing about it, and at the same time, most physicians here support a better mix.
Australians seem to be perfectly happy with this at the current moment. As the government moves to increase the Class A (15 minute) medicare rebate most GPs will revert back to a bulk billing model.
As for the overall cost of health care - I think it's really hard to say how much impact it really has. Since the individual doctors have so much say in who gets bulk billed and who doesn't; my experience has been those who can't afford out of pocket usually get bulk billed.
There is also a lot of redundancy in Australia's health care system, with completely public clinics, public hospitals, public imaging facilities etc. and all of these are 100% bulk billed. It's the private facilities that vary widely - but most people prefer these because there is a lot less waiting time.
You can liken the situation to the many residents of Ontario that go to the US to get consultations/surgical procedures done simply because they don't have to wait as long.