Cut-price health care is on the way with the Government’s fees website
BY AMA VICE PRESIDENT DR CHRIS ZAPPALA
All would be aware the Commonwealth Government is planning to launch a website to display doctors’ fees. We will be asked to voluntarily (at least initially) place our fees on the website. Given approximately 95 per cent of services are provided without a gap or known gap of usually no more than $500, the intent of this seems to be less about revealing out of pocket costs than in managing egregious billers and trying to prevent bill shock. This is an important point because the Government will presumably have to attempt an assessment of whether the website has actually achieved anything in the future (perhaps this is a touchingly quaint hope that Is not being contemplated in any form?).
In the very recent AIHW funding report it was noted that the largest out of pocket expense for patients was non-prescription medicine (31 per cent), dental services the second largest at 20 per cent and medical costs only 13 per cent. From the outset there is therefore immediate conceptual problems with the fees website as doctors are far from the largest cause of out of pocket costs.
The AMA strongly believes that all attempts to improve health literacy are worthy and that patients have an immutable right to receive fully informed financial consent. Recognising our responsibility in this regard the AMA developed the recently released Informed Financial Consent document <https://ama.com.au/system/tdf/documents/Informed-Financial-Consent%20resource.pdf?file=1&type=node&id=51042>.
This document sets out in simple terms how fees are compiled and how gaps are generated, with reference to the nefarious hidden effect of variable and insufficient health insurance rebates. This context is important because patients do not realise that out of pocket costs are borne largely from insultingly low rebates (both Medicare and health fund rebates). As soon as the doctor charges over a known gap the health funds receive a partial reprieve for reasons that defy understanding – and their rebate can drop even lower to only 25 per cent of the insufficient MBS benchmark. This then is perceived by the patient as the doctor over-charging – but in fact the root cause is the avaricious behaviour of the insurance funds to preserve handsome profits by offering low rebates and successive Governments in attempting to reduce what they pay for each citizen on healthcare. There is some sense this might be working with a reduction in the proportion of total tax revenue from Australian Governments paid for healthcare from 26.0 per cent (2016-17) to 24.4 per cent (2017-18) and real growth in Australian Government expenditure on Health is noticeably slowing compared to previous years. Over this same time period, expenditure by individuals on health increased by 3.0 per cent.
The undoubted principal driver of both doctors’ income and patient gaps are rebates (both Medicare and private health insurance). Together with the knowledge that a very significant proportion of services are provided at no/known gap, it remains unfathomable how any contemplation of a Government fees website could omit detail of the rebates. Moreover, I’m not sure it is at all fair to ask/insist that doctors disclose their fees if the private health insurance funds are not going to also disclose their rebates given the entwined relationship of both. For any patient to truly understand the cost of care and gap they might be requested to pay, all rebate information must be disclosed. This is technically possible using publicly available data of PHI rebates.
Doctors will sometimes adjust their fees to accommodate variation in PHI rebates to insulate the patient from excessive out of pocket costs. This requires discounting to some patients (for the same procedure/service) who are members of funds offering low rebates in order for costs to remain within no/known gap arrangements for that miserly fund. A simple average fee/fee range disclosure website without PHI rebates does not allow vision of this discounting effort by doctors. If a key goal of the fees website is to help people understand reasonable versus egregious billing or their out of pocket costs, as stated by Minister Hunt, it is therefore necessary to highlight the rebates in a central location, rather than on each, disparate health fund website.
Consider when a doctor charges a single, set fee to all patients for a particular service – variable rebates once again create confusion for patients. Similar gold policy holders across funds could each be subject to huge variation in out of pocket costs depending on rebates that can vary several fold. This rebate variation then leads to patient receiving the same service from the same doctor and possibly in the same institution having vastly different costs from no gap, to a known gap under $500 or a large out of pocket cost.
We must appreciate and agree in advance of the proposed Government’s fee website, in any competitive service or commodity market in which price is the principle arbiter in choice of purchase, then a high quality product will never be achieved. The incentive to go the extra mile with a patient evaporates under the relentless discounting (and time) pressure that occurs as doctors compete based on price alone. Quality medicine could easily suffer if discounted services become the principle method to attract patients and earn a living.
Let’s ponder some other implications of price-based competition in healthcare. Why bother getting an advanced skills diploma/higher research degree or doing a fellowship year to improve your knowledge/skills if it provides no advantage for receiving referrals/patients because people just want to see any doctor as soon as possible for as little money as possible. The only thing patients might see prior to contemplating an appointment with you are your prices compared to everyone else, without appropriate context or meaningful information to allow an assessment of your quality or expertise. Credible comparative information on expertise, skill and quality would be very difficult to reliably gather and portray. Without it however, the Government’s fees website becomes much less a genuinely useful tool for patients to make informed choices and more the rudimentary fulfilment of a political promise without proper regard to the unforeseen deleterious consequences.
There has always appropriately been a public service element to medicine – but price competition places this in jeopardy. Why bother doing a telemedicine clinic to an under-serviced regional area because these are administratively more difficult to organise and the remuneration is inferior to a standard face-to-face clinic in your rooms? Forget travelling to a regional or rural location to do a clinic for predominantly pensioners or healthcare card holders as your substantially increased costs in conducting this clinic will not be recognised or recoverable. Taking the little bit of extra time with a patient is unrewarded. When competing on price alone, it becomes much more difficult to sustain marginally profitable aspects of practice regardless of any service element.
I acknowledge we still have significant responsibilities that as a profession we must attend to. The profession does have to emphatically abolish the practice of charging administrative or booking fees. The quid pro quo however for this to occur is insurance funds agreeing to provide rebates up to the AMA fee, in other words, rebates must be appropriate and reflect the true cost of the service being provided. The maintenance of parlous, differential rebates across thousands of health insurance policies must cease, by regulation/law if required. It would also be necessary for the Government to address the hopelessly deficient MBS rebates in key areas – perhaps they could reinvest some of the savings from the MBS review we keep hearing about?
It is impossible to define an egregious fee. We can however place stock in the AMA list of fees. If greater surveillance and scrutiny of medical fees is going to occur one way or another, perhaps we should be confident enough to publish the AMA fee for key items where possible egregious billing is perceived to occur, so patients can have a sense of the approximate fee they could expect to be charged. If a fee is several-fold greater than this then it is not unreasonable for patients to ask why this might be the case and be given the chance to seek a second opinion. The ACSQHC Atlases of Variation go some way in achieving this already.
Helping rein in egregious billing is part of our professional responsibility and only the AMA has the credibility, experience and scope to gently and progressively deal with this enervating problem. Had we been more active and successful at constraining egregious billing several years ago there is a high chance we would not be having this conversation about a Government medical fees website at all and the entire spotlight of discontent would be squarely where it belonged, on the funders of health care.
Published: 11 Oct 2019