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It's the latest move from Washington that challenges its long-standing friendship with Canberra, sparking fears Down Under that, as conflict heats up around the globe, Australia may be left standing without its greatest ally.

The move comes as Australia faces pressure from the White House to lift its military spending, from 2% to 3.5% of GDP, a push so far resisted by Canberra.

US President Donald Trump has called on Australia to increase its spending to 3%, but Canberra has yet to publicly commit to that number.

It's all placed extra value on Canberra's alliance with Washington DC - one that Trump may be throwing into doubt.

But the scheme essentially meant Australians could present their bright green Medicare member card at a doctor's office or hospital, and Canberra would be sent a bill.