We told you so: Ignoring primary care is never a good idea

Last night’s undecided election results raise many questions – and doctors will say: we told you so.

Family doctors have made it very clear during the lead-up to the federal election that it’s crucial for governments to invest in primary care to keep Australians well and out of hospital.

But not only that, during the longest election campaign in Australia’s history, GPs around the country have had discussions with millions of patients about the future of their healthcare.

Looking at the outcome of the election night, it seems that voters have taken the message to the polling booths.

Wealth should not affect our health

The day after the federal election date was announced, the Royal Australian College of General Practitioners (RACGP) launched the You’ve been targeted campaign, warning people about the looming higher out-of-pocket costs, which have already become a reality.

The aim of the campaign was not to increase health corporate profits or fill doctors’ pockets, it wasn’t even a political campaign – it was all about the message that the Australian people must be able to visit their doctor when they need to.

Doctors called on a newly elected government to invest in quality and sustainable general practice to strengthen patient services.

“Our first and foremost responsibility is to our patients,” said RACGP President Dr Frank Jones, “and this is really the message from the College in the campaign, because this is about the fact that we cannot sustain quality general practice under the present Medicare freeze.”

Posters went up in GP surgeries, messages were printed at the bottom of prescriptions, TV ads were aired and there were 2340 syndicated media stories featuring the RACGP on national TV, print and radio, and in medical and consumer media outlets across all formats.

The Australian Medical Association (AMA) followed suit and threw its weight behind the issue, and shortly after many political parties made health a key focus during the election campaign. The policy shift by Labor to lift the Medicare freeze and fund chronic disease management by general practice teams was welcomed by many.

What should happen next?

Whatever the outcome of the election will be, the new government would do well to sit down with GP leaders and develop a long-term plan to strengthen primary care. The message is simple and supported by abundant evidence: strong primary care keeps people well and out of expensive hospitals. Investing in general practice patient care pays off!

Dr Frank Jones: “The RACGP is seeking progressive health reform and a genuine commitment to the future of our healthcare system from our political leaders and we are committed to discussing funding models for a sustainable and effective primary health care system.”

As GPs around the country are moving away from bulk billing, health minister Susan Ley has already indicated she is prepared to look at a medical home model. The proposed appointment of a National Rural Health Commissioner and commitment of the Coalition to pursue a National Rural Generalist Training Pathway is another positive sign.

However, the medical home is more than a hospital avoidance project. “In a patient-centred medical home, patients have a stable and ongoing relationship with a general practice that provides continuous and comprehensive care throughout all life stages,” said Dr Jones. “This model is the most cost-effective way to address the needs of patients, healthcare providers and funders.”

There are many versions of the medical home or healthcare home. The ‘gold standard’ version is outlined in the RACGP’s Vision for General Practice and a sustainable healthcare system.

Part of the future plan should be the continuation of high quality primary care research and the introduction of non-face-to-face patient services such as video consultations to improve access to family doctors and to transform Australian primary healthcare to the digital age.

Big health corporates win, but who keeps your family out of hospital?

Big health corporates seem to be doing well at the expense of grassroots general practice. This raises concerns about the delivery of patient care in our communities – including keeping people out of hospital.

Last month shares in Primary and Sonic jumped around five per cent after the government promised a number of carrots, including a potential rent reduction for their pathology collection centres within GP surgeries.

Last week the government struck a deal with the Australian Diagnostic Imaging Association. The Sydney Morning Herald: “The Turnbull government forged a deal with the sector late on Friday, promising to delay the cuts for non-concession holders till next January if elected, and to evaluate commercial pressures on the sector.”

Today The Australian reported: “There are groups that are doing well from the status quo, notably the health insurers and pharmaceutical companies. Last year, Medibank Private increased its operating profit by 32.5 per cent. Not bad during a period it lost policyholders.”

“There has been a percentage decrease in spending on hospitals and general practice medical attendances in recent years. At the same time, private health care premiums continue to beat inflation.”

The Australian Newspaper: “The big winners, however, are the pharmaceutical companies. The government funds $10 billion a year (up from $7bn in today’s money a decade ago) and on top of that, consumers stump up a whopping $10bn in over-the-counter preparations. Saving even a fraction of this increment would make an enormous difference to hospitals, general practice and outpatient care.”

Meanwhile, GPs and patients are still faced with the freeze on Medicare rebates. As RACGP president Dr Frank Jones has pointed out on many occasions, this situation has placed GPs and their practices in an invidious situation whereby all patients will have to financially contribute to their consultation and practices will have to curtail some quality patient services to survive financially.

It seems to me there is something seriously wrong with the priorities in our healthcare system.

Why doctors will stop bulk billing

Patriotism is supporting your country all the time, and your government when it deserves it ~ Mark Twain.

Although federal health bureaucrats seem to think bulk billing rates will increase, about 30% of GPs say they will stop all bulk billing soon. In a previous post I explained why. As a result of government policy to freeze patient Medicare rebates, doctors are faced with three options. They can:

  1. take an estimated $50,000 pay-cut;
  2. see more patients more often;
  3. charge more.

Some will choose option 1, because they don’t want to or cannot charge their patients more, and are also unable to work more. The reality is however that most GPs will not be able to afford this option.

Others will go for option 2: they may, for example, see 7-8 patients per hour instead of 4-5. They may decide to work more days and longer hours. The question is of course: how safe is this?

Can doctors continue to offer good care when they are churning through high patient numbers? It will certainly feed the epidemic of burnout, depression and suicide among doctors and medical students.

What the Medicare rebate freeze is all about
Medicare is shaping up to be a major election topic. Still, the freeze on the patient Medicare rebate is a complex topic for many. It was a lot easier to understand when Medicare was called the Health Insurance Commission, but the principle is still the same: Medicare pays a contribution towards the doctor’s fee on behalf of the patient. Many GPs have accepted this contribution as a full payment, which is called bulk billing.
The ‘indexation freeze’ everybody is talking about means that this Medicare contribution will not be increased annually, in line with the increasing cost of living. The shortfall will have to be made up by patients which means that the out-of-pocket expenses will go up as doctors stop bulk billing. The freeze on the patient Medicare rebate was introduced by the Labour government in 2013, and will continue under a Coalition government until 2020 and possible longer. The rebate has not kept up with costs and inflation for a much longer period.

3-tier system

Then there is option 3: doctors will charge more, which will increase out-of-pocket costs for patients. As RACGP president Dr Frank Jones mentioned in this interview, we may see a 3-tier system in Australia soon:

“Dr Jones warned poorest patients would feel the impact of the freeze hardest, while there was a risk doctors would churn through appointments more quickly.

He predicted it would lead to a three-tier billing system: doctors would bulk bill their most disadvantaged patients, charge other health care cardholders a concessional rate, and private patients would be charged the Australian Medical Association’s recommended fee.”

In 2015 the RACGP surveyed GPs on how they planned to manage the patient rebate freeze. Of the 566 members who responded, the majority (57%) said they would have to increase out-of-pocket costs for patients.

GPs said they would have to do this either because the practice would stop bulk billing and begin charging a gap or co-payment (30%), or the practice would increase out-of-pocket costs for non-concessional cardholders (27%). Only 8% indicated that they would not increase out-of- pocket costs for their patients.

How fees will go up

It is to be expected that many practices will start cost-cutting: staff levels may be minimised and investments in new equipment, training & education, IT or buildings may become a lower priority. This is a risk for the quality of care.

Practices will determine a fair and equitable fee based on their increasing practice costs, professional time and services. The RACGP and AMA support GPs to set fees that accurately reflect the value of the services they offer, such as the recommended fees in the Australian Medical Association’s List of Medical Services and Fees.

Practices will review their patient demographics and billing profile and optimise the utilisation of MBS items. Pensioners and/or health care card holders may be charged an extra fee which will be much higher than the bulk billing incentive of $9.25.

Practices may decide that certain services will attract fees, for example dressings and other consumables, treating doctor’s reports, off-work/off-school certificates, phone/video consultations, data entry or certain surgical procedures.

Updating practice management software to streamline Medicare claims and EFTPOS payments may be required in some cases. Expect notices to go up in surgeries across the country to tell patients about the changes in billing policies. Unfortunately there will also be some practices that will have to close their doors.

5 reasons why the Medicare rebate freeze is bad policy

When I tweeted about the Medicare freeze last week, someone asked “Care to explain other than meaning you get less money?”

I thought it was a really good question as it highlights the complexity of the issue. Most people seem to think that it’s all about doctors’ income – but it isn’t. The Medicare rebate is also about the money patients get back from Medicare.

As we speak, around Australia GP practices are adjusting their fees as a result of the government policy. Our practice increased the fee of a basic consultation with five dollars for people without a concession card. Other practices have decided to charge a once-off $30 payment to previously bulkbilled patients.

I expect that if the freeze is not lifted these amounts will have to go up again soon.

Greedy doctors?

Everything gets more expensive over the years, including the cost of running a medical practice – think for example about rent and employing receptionists and nurses. If GP practices would not up fees, their Medicare rebate income would drop with 7.1% by 2017-2018!

Over the years more and more services will require an out-of pocket payment by patients, including pensioners and healthcare card holders. Rural doctors expect that bulkbilling in the bush will soon be a thing of the past.

But the freeze has also affected urban areas. That’s why the the RACGP and AMA have labelled the government policy a ‘copayment by stealth’.

Five arguments

The freeze is bad policy and should be reversed for five reasons:

1. Many practices will stop bulkbilling. This means higher out-of-pocket costs for patients. As a result fewer people will visit the doctor in the early stages of a disease. This will often make treatment later on more difficult, more stressful and more expensive.

2. The policy disproportionately affects disadvantaged people who cannot afford a copayment. Research shows that increased out-of-pocket costs stop people from going to the doctor.

3. The freeze undermines important Australian values such as equity of access and therefore encourages a two-tier health system.

Some argue that a copayment would cut unnecessary use of medical services. But higher out-of-pocket-costs will not weed out unnecessary visits. Many of my colleagues know that often their sickest patients will not seek medical care if it becomes more expensive.

4. Research indicates that areas with poor access to GP services have higher hospital costs. It is likely that more people will visit places where healthcare is free, such as already overloaded public hospitals and emergency departments. Dr Google will become more popular too!

5. Practices continuing to bulkbill will have to change their business model: doctors need to see more patients per hour, or practices will have to hire less staff which will affect service. Some practices will close their doors – such as Dr Adrian Jones, a Redfern GP who decided to close his practice as the margins were getting too small.

Is the freeze a necessary policy?

Medicare is not unsustainable. This is a false argument by the government. In fact, Federal Health Minister Susan Ley admitted at the national AMA conference: “The Government is not claiming we’re in a healthcare funding crisis.”

Australian healthcare performs well in comparison to other countries. The increase in health expenditure in general practice has been slow, and in line with overall economic growth and GDP.

Freezing the patient Medicare rebate will not make healthcare more efficient or reduce waste in the system.

Medicare freeze

Doctor do you bulk bill?

Since 1984 Medicare is the health insurance scheme from the Commonwealth Government, providing free treatment in public hospitals and subsidised treatment for other crucial health services such as the care by GP’s.

Medicare has set a list of fees it is willing to pay for medical services. The fees in the Medicare Benefit Schedule are not recommended fees, but merely what Medicare is prepared to contribute to a consultation or operation.

Unfortunately, as the picture below illustrates, the Medicare fees have not kept up with inflation and costs. While the cost of running a GP practice is going up every year (the upper line in the picture), Medicare has only slightly increased their fees over the years (the lower line in the picture).

Bulk billing
The fees doctors charge are set at a level that enables them to look after patients properly. The cost of providing good medical care is rising (the upper line) but the Medicare fees are falling behind (the lower line). That is why you may find your doctor’s practice does not bulk bill as a rule. AWE: average weekly earnings. CPI: consumer price index. Source: Australian Medical Association.

The Government entirely funds public hospitals, but not GP practices. As a result, GP’s who own their practices need to cover the costs of running a business – just like electricians and hairdressers. Costs include for example paying rent, wages of receptionists, nurses and trainee doctors, and medical equipment.

GP’s who follow the Medicare fees are effectively taking a pay cut every year (the shaded area between the upper and lower line in the picture is getting bigger each year). Eventually GP’s would not be able to invest in their businesses, pay their staff and provide good care to their patients. This is the reason many GP’s charge more than the Medicare fees, and why the gap between the doctors’ fee and the rebate you get back from Medicare continues to rise.

Many doctors follow the list of suggested fees by the Australian Medical Association. Unlike the Medicare Benefit Schedule, this list has been updated annually to keep up with inflation and the costs of running a practice.

Bulk billing is where doctors accept the Medicare fee as payment of their services. But as said, these fees are decreasing in real terms each year. Bulk billing has a real risk that quality of care is affected. Asking a doctor to bulk bill has more consequences than people think. For that reason many GP’s are not bulk billing as a rule – although they can make exceptions based on circumstances such as financial hardship.