Interview with Dr Kerryn Phelps, AMA President, Radio 2GB - Discussion about the corporatisation of medical practice, including the reasons why local doctors are turning corporates

Concerns have been raised by the AMA and others after a group of Sydney GPs now unveil plans to set up their own co-operative and list on the Australian Stock Exchange, for heavens sake.

The days of the solo suburban practitioner may be numbered, Doctor Kerryn Phelps, AMA President, joins me on the line this morning.

Doctor Phelps, good morning.

KERRYN PHELPS: Good morning, Philip.

CLARK: Are you worried that more and more doctors are banding together in corporate groups.

PHELPS: I think it is a matter of concern. This is a trend that's really been seen just over the last 12 months and I think we have yet to see the ultimate outcomes for quality of patient care and certainly, I think, that there will be some good guys and bad buys that emerge from this whole scene.

But there are a number of warning signs and I think in particular the issue of where there's a clash between corporate profits and patient care, that's the area where I think we're going to see some concerning developments.

CLARK: Yeah, okay, look, I'm sorry about the quality of this telephone line, we are doing our best with it. The notion that doctors need to band together is driven in part by the fact that, what, they don't think they're earning enough money?

PHELPS: It's being driven by a number of factors, the first one is that I think that corporates found general practice at its lowest empt and we've being saying for many years now that the medical benefits schedule for general practice is just a farce.

And doctors were finding it increasingly difficult to abide by the schedule or to bulk bill and to maintain a viable practice and I think a lot of them were just looking for an escape.

The second thing is that there's been increasing bureaucratic burden on general practice and I think the GST was just the last straw. Doctors, if they thought that health was going to be excluded from the GST, all that happened was that we got on the chocolate wheel and it goes in one door and out the next and you've got to pay for the accounting along the way. And it's an incredible impose just the same as the small business.

The other issue is that I think government has been aiding and abetting this whole process over the last couple of years by thrown millions of dollars at amalgamation trying to get doctors out of small group practices and into bigger groups.

So, we've seen a whole lot of things coming together all at once and ultimately leading to doctors saying, well, you know, here's this big corporation offering me money and offering to take the administrative burden away from me. Why don't I just take the money and go and do it because I'm not have a very good time the way things are now.

CLARK: Doctor Phelps, how much do doctors earn anyway?

PHELPS: Well, the average general practice salary is or income is around 80,000, but obviously that's an average so there will be many earning less than that and some who are earning more.

CLARK: That's an average, as you say, is there a medium figure that's available to you?

PHELPS: Well, I suppose, we're looking at a medium of around that. The problem is that we've seen increasing staff costs, we've seen increasing costs of running practices and we just haven't seen anything like that as an increase in the medical benefits schedule.

So, doctors have basically had to be able to make do with whatever was left over once all their costs were paid and that has been very much a case of diminishing returns for increased effort.

CLARK: Yeah, but the life of a suburban GP is one where you've got to put in, it's a major time commitment, mind you, it is also one where you do form relationships with patients.

You get the sense of these corporate medical centres there's no relationship with patients at all. It's just a service centre.

PHELPS: Well, I think it will depend on the way the corporate is set up and how much consultation continuity there is. But certainly, I think, there is a threat in the big centres where the doctors are not necessarily connected with the community, that there will be a loss of that personal one on one element where the doctor knows your family, knew your mother, knows your kids.

I think there is a potential threat to that and I'm not quite sure how the corporate companies are going to try and overcome that, if indeed they are going to try and overcome that. Because there will definitely be increased transportability of doctors under this system.

CLARK: Yeah, alright, if the trend is accelerating as you say, is short of a government change to Medicare which gives doctors a bigger slice of return, there's not much that can be done to reverse it is there?

PHELPS: I don't know. I think that what we'll see over the next three to five years when the initial contracts start to run out, if the doctors are finding that they are having to compromise their ethical principles or compromise their level of patient care, if they're not getting choice as far as the staff that they have, the equipment that they have, when they want to take leave, those sorts of things, if they're being imposed on them rather than them having a choice and an independence regarding their clinical decisions.

Then I think that they'll be making decisions then about whether they stay in the corporate practice or go back to the more traditional type of independent practice or not. If they're happy with the way things are then, I think that that will be another story and certainly, as I said, I think that some of the corporate companies will be good guys and some of them will be bad guys and I think that the bad guys will find themselves out of business in a few years.

CLARK: Yeah, as always. Alright, Doctor Kerryn Phelps, good to talk to you.

Doctor Kerryn Phelps, AMA President on the line, it's, well it is one of those things, the notion of the independent GP coming to give you assistant in the suburban practice, a wonderful thought, but the truth is a lot of them do work hard and a lot of them in their mind do not get huge returns for it.

It's not right to think that every GP is earning a packet, they're not.