Sussan Ley has confirmed a secret Liberal plan to outsource medicare payments to the private sector, but denies it will be a ‘privatisation’ of the health system.

Speaking to ABC breakfast radio on Tuesday, the Health Minister argued the need to update the 1984 system.

“We need to move it on, and we need to make it work for everyone,” she said.

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Ms Ley said she wanted less money spent on back-room bureaucracy and more dollars for the frontline and patients.

Telstra is one of the companies that has expressed interest. Photo: Getty

However, the Minister was firm in saying the process would not be completely sold off.

“We’re not privatising Medicare.”

On Monday, various media reports claimed the government was hatching a plan to sell the historically public service into the private sector.

Australian companies including Telstra (which yesterday apologised for mass outages across the country), EFTPOS providers and a number of big banks have put their hands up for the job, as they have the relevant transaction software in place.

The fledgling, government-owned Australia Post also expressed interest in helping to process the payments.

But Ms Ley told the radio show the government would still be responsible for nominating the amount Australians pay to Medicare, somewhat easing fears of big hikes.

However, the companies would be responsible for making eligibility decisions and would like require access to the public’s sensitive health records.

Foreign multi-national companies will also have the right to bid for the job.

Labor has opposed the move, saying it will destroy Medicare.

“My message to Malcolm Turnbull and his Liberals is ‘hands off Medicare'”, said Bill Shorten on Monday.

“The Australian people love their Medicare and you have no right to trash it.”

– with AAP