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Doorstop - Dr Kerryn Phelps, AMA President, Sydney - Proposed changes to Medicare which have been leaked to the media

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PHELPS: ...make some comments about the Medicare reforms that are likely to be announced in the next week. Obviously, at this stage, any speculation is purely that, it's speculation. But, I think that the nature of the reforms that we're about to see announced will be so monumental that they really signal a fundamental shift in the whole ideology of Medicare so I think it's very important that we have some discussion about what has been leaked to date.

JOURNALIST: It does suggest that to date you were not having any discussions with the Government on something that's so important to GPs.

PHELPS: The Government has been consulting with the AMA over a period of time about the nature of their reforms. We're happy with some of those suggestions. We're not happy with others. Certainly, what we're seeing announced in the press today is along the lines of what the Government is likely to be announcing and I think that we need to really look at what this means in terms of the fundamental ideology behind Medicare because there's no question that this is an acknowledgment that bulk billing be, universally, for all patients, discontinued.

Medicare has been propped up by GPs for many years now, and it really has reached a point where the Government is saying that they can't afford to pay the real value of medical services and doctors are saying that they can't prop Medicare up any longer.

JOURNALIST: Because GPs underpin the whole health system, this is basically going to mean that middle income people may be hit quite hard because they're the ones who can't keep afford paying the $20 every time they have to go to see a GP. What effect could that have overall on the health system if people stop seeing GPs as often as they do now?

PHELPS: I don't think that we can assume that middle income earners can't pay $20 when they go to see a GP when they can pay to see a hairdresser, an accountant, a lawyer and any other professional person that they might need to consult. And so I think that that assumption is questionable.

There is, however, no question that people who are not on health care cards will be facing higher out-of-pocket costs and this really has been inevitable for many years since governments of different persuasions have elected not to pay the full cost of providing those medical services. So as the Medicare Benefit Schedule has fallen further and further behind, doctors, through their altruism, have been propping Medicare up because they didn't want to have to have patients deciding whether or not they should see the doctor based on affordability.

The real issues that the health system is facing at the moment are those of access and of affordability. Now, if you've been sick you know that what you want is a doctor who will be able to see you, who will be able to give you the care that you need, when you need it.

There is also the issue of affordability and I think that what we are now facing is a question over what is affordable and what is not affordable and there is no question that continuing to universally bulk bill is not affordable for GPs. So the question is then, who pays the shortfall? Should it be the taxpayers or should it be people when they go to see the doctor?

JOURNALIST: Who should pay the shortfall?

PHELPS: That's the question that we're facing now and I think that for the first time in many years we're seeing a point of difference between the political parties and I believe now that health will be the main issue at the next federal election. We need to see responses from all of the major parties, about what they intend to do about Medicare. Certainly, this is a significant down payment on what needs to be done about Medicare but what the medical profession wants to see is not more money going to doctors. What we want to see is more money going to patients in the form of their rebates.

Medicare has always allowed for doctors to charge whatever they wanted or needed to charge in order to keep their businesses running. It's through the altruism of GPs over the years that they have been supporting Medicare in the absence of significant, appropriate funding for Medicare.

JOURNALIST: Are these reforms moving in the right direction, though?

PHELPS: I think we need to really look at what direction that we're heading and what we're doing, I believe now, if these reforms come into place, we're going to be seeing patients who can afford to pay more, pay more out of pocket. We're really seeing an acknowledgment that the taxpayer is not going to be paying what Medicare needs to pay to afford that system.

Now, if we look at the shortfall over several years, it amounts to about $1.2 billion a year so that's how much general practice has been supporting Medicare, to this point.

JOURNALIST: So you're not necessarily saying that you see any problems with these reforms. You just want the government to discuss it with you.

PHELPS: The Government has been discussing these reforms with us. The concerns that we have are that the increases in the amounts that are going to be paid to doctors for bulk billing their concession card holders, there are problems there because they are geographically based. Now, that doesn't mean that it's based on the patient's need. We would like to see any subsidies going to patients based on the patient's need not based on where the doctor lives or works. So that's one concern that we have.

Another one is that this is not likely to be of any assistance to doctors who live in areas where there are high numbers of concession card holders, particularly in urban areas.

JOURNALIST: You've long been calling for doctors to be able to bill Medicare directly. Is that a welcome move from the AMA's perspective?

PHELPS: Doctors can elect to directly bill Medicare but the problem is that they are then bound to the Medicare benefit schedule which is grossly inadequate, if you're going to be running quality general practice. General practice is in desperate need of recapitalising, it's in desperate need of being able to provide doctors with an appropriate working environment and to be able to pay the cost of running their practices.

So we really have needed to see significant Medicare reform. What we will be seeing, I believe, is significant Medicare reform but unfortunately it appears to be based more on where you live rather than what your need is.

JOURNALIST: So it's not enough to give doctors more to bulk bill low income people and this looks like extremely low income people, too.

PHELPS: I don't think it's going to be enough to stem the tide away from bulk billing. In fact, I think that what will need to happen is that for doctors to continue to bulk bill their concession card holders, they're going to have to charge their non-concession card holders more in order to meet the cost of running their practices.

JOURNALIST: So is it an option to include the possibility of private health insurance for GPs as is suggested?

PHELPS: The AMA has no objection to people being given the option to insure themselves for medical costs in the private sector but the problem that we see potentially is any interference along the lines of managed care by the health insurance companies. We wouldn't want to see any interference with clinical decision-making.

JOURNALIST: It might not be very attractive for health insurers either, I wouldn't think, because GPs being the primary care person, it's who someone inevitably goes to and usually a large amount of times.

PHELPS: I think it may be a marketing tool for health insurance companies if they decide to go down that path but if it's not attractive to private health insurers and it's not attractive to patients then it's not going to happen.

JOURNALIST: How will this proposed system works? You say it benefits people in terms of geography, how is it going to work in that capacity?

PHELPS: The reports that have been leaked to date indicate that there will be about $1 per consultation for people who have concession cards if they live in an urban area. It's more if they live in an outer urban area. It's more if the doctor is in a remote area and so forth. So the more remote the doctor lives the greater the subsidy for those patients.

I think the problem then is for particularly urban doctors who are in areas where there are high numbers of concession card holders so high rates of chronic illness, high numbers of people who are unemployed or on pensions and so there is very little value in that for those doctors and I think that we will probably see a hastening in the decline of bulk billing in those types of practices and in those areas.

JOURNALIST: Is it going to do anything to keep doctors in rural areas?

PHELPS: I think we have to wait to see the whole package, as to whether there is enough of an incentive for rural doctors to change their practices at all. Certainly, the lowest rates of bulk billing are in rural areas and the patients that will benefit are those who are in practices where the doctors bulk bill some of their patients but privately bill those who can afford to pay.

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