The Budget revealed

So we finally, sort-off, know what this budget means for us.

Lets first look at what the current status quo is:

I will use some of the common item numbers as an example:

Non-vocationally registered GP rebates have not increased since about 1994 – for a standard 5-25min consult a Bulk billed visit would generate $21.00 for a a Practice

All non-VR fees are substantially lower than VR fees but since we do not have a non-VR Doctor at our Practice at present I will focus on the impact on VR fees

Vocationally Registered Rebates has been frozen since November 2012 – a standard 5-20min consult currently generates $36.30 for a Practice.

A standard Home visit range between a maximum of $61.75 for a single person to a minimum of $40.54 depending of how many people you see (has to be 5-20min for each, cannot charge for travel or admin time before or after the visit which can easily amount to 30min or more)

The same applies to a Nursing home visit where the fee ranges between $82.10 and $39.55

Children under 16, Pensioners over 65 and other concession card holders generate a Bulk billing incentive payment of $9.10 per visit

Despite the freezing of the rebate our Practice has not increased fees for three years – our Bulk billing rates have also crept up (reflecting the financial situation of our patients) to currently sit at nearly 50% and of the remaining privately billed patients the majority are billed at a discounted rate and not the full private fee.

Currently we are also able to direct pathology providers as to how they should charge patients – if we instruct them to Bulk bill patients they have to oblige (this does not apply to imaging providers who set their own fees)

Current legislation also prohibits us from charging an amount to a patient and then billing Medicare directly for the rest

So what do we know after tonight’s budget:

  • The current GP rebates for “standard consultations” are REDUCED by $ 5
  • All patients are expected to pay a contribution of $ 7
  • Those concessional patients who previously generated a Bulk billing incentive can stop paying the $ 7 after the first ten visits in a year and the Medicare rebate will increase back to the current benefit levels
  • The Bulk billing incentive is replaced by a “low gap incentive” for patients who previously qualified for the incentive, who has paid the $7 for the first ten visits and were subsequently not charged any gap for the rest of the year
  • The $ 7 payment will also apply to all imaging and pathology requests and even to “GP-like” attendances to our Public Hospital Emergency Departments
  • PBS payments for medication also increases
  • “Some” MBS fees are not going to be indexed until 1 July 2016. “GP MBS fees” will be excluded

So what does this mean for the Practice:

  1. Financial implications:
  • If we collect the $ 7 co-payment from a non-concessional patient we will generate $ 2 more than what a Bulk billed consultation would previously had generated
  • If we collect the $ 7 co-payment from a concessional patient we will generate $ 2 more than what a Bulk billed consultation for the first ten consultations. After the first ten consultations we will generate the same income as current from a concessional patient without collecting a co-payment
  • If we do not collect a co-payment from a non-concessional patient we will be earning $ 5 less than before for the Bulk billed visit
  • If we do not collect the co-payment from a concessional patient (during the first ten visits) we will lose $ 5 off the rebate AND the $ 9.10 “low gap incentive” (Assuming that amount stays the same as current) – this is a whopping 33% drop in income for the consult ($47.40 reduced to $31.30) A non-VR doctor will end up reducing the fee by 50% to a paltry $ 16 for a 5-25min consultation
  • The indexation freeze of the MBS items are most likely going to affect the significant procedural component of my daily work. This, and the fact that we have not raised our overall fees in several years despite significant increases in our operational costs, will result in our private fees increasing in the next few months

2. Logistical implications:

  • It is currently illegal to collect a payment when Bulk billing – major software changes and staff re-training lies ahead not to mention the stress on our staff when dealing with the patients.
  • How on earth are we supposed to collect a co-payment from a Nursing home patient’s relatives ? Doing Nursing home work at present makes very poor financial sense and this may be the final straw that results in us withdrawing all services from Residential Aged Care Facilities
  • How does one keep track of the ten visit limit – patients see different doctors at different locations. Yet more software and red tape nightmares

How is this likely to affect our patient’s Health:

Non-concessional patients will most likely be able to afford the extra $ 5 when we privately bill them (reduced rebate). It would however be extremely rare that we would ever be able to justify bulkbilling one of these patients again as the rebate is simply too low.

The budget measures are considerably less drastic than the Commission of Audit’s draconian recommendations that would have essentially forced a huge number of patients off Medicare and on to Private Health Insurance for their GP needs (although I suspect that is still in the cards in the near future)

I am however not sure if these patients will however be able to keep up when the extra pathology, imaging costs are all added up.

Concessional patients will do exactly what the Government want people to do – they will simply not attend Healthcare. As a small business I cannot afford to give them a 44% discount by not charging the co-payment. As things stand the current rebate is only just over 50% of our standard private fee and a further reduction of this magnitude is simply not viable – we will therefore charge the co-payment and this will push people away. I am not sure where they will go if the Emergency Departments also start charging but I have a responsibility towards my Creditors, Staff and Family and can only be generous up to a point and this may simply make it impossible for me to be the doctor for some of my most vulnerable patients. They are going to cut back on visits, miss pathology tests and stop taking their medication.I think this is inevitable



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