A Labor-Greens dominated Senate committee has told the federal government it should not proceed with a Medicare co-payment.
It also recommends a comprehensive review of existing co-payments, especially their impact on the most vulnerable Australians.
The committee has been investigating out-of-pocket costs within the health system, including those covered by private health insurance.
Its inquiry coincides with a decision by the government to introduce a $7 Medicare co-payment from July 2015 and increase co-payments for taxpayer-subsidised medicines.
It found significant out-of-pocket costs are being incurred in healthcare areas where there was limited or no relief by way of government or private health insurance rebates.
As a result, some people were deferring medical treatment or having their prescriptions filled because of financial reasons.
The committee accepted Australians may need to continue to accept a reasonable level of out-of-pocket costs.
"(But) it is essential that vulnerable and disadvantaged people are adequately protected from the harshest consequences of such costs," it said in its report tabled on Friday.
Liberal MPs were not of the same view as their Labor and Greens colleagues on the committee.
They said the report failed to recognise the unsustainable growth in health expenditure.
Unsurprisingly, they recommended the government proceed with the measures it outlined in the May budget.
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