Dr Kerryn Phelps, AMA President, with Jon Faine, ABC Radio 3LO

FAINE: Well, how widespread is this? Are there other, many other doctors who are abandoning bulk-billing at the moment?

PHELPS: Very much so, and I think that we will now see quite a sharp decline in bulk-billing because the Government does not appear to be heeding the concerns of general practitioners who are saying exactly what the doctor of this lady has been saying for quite some years now. That the increase in Medicare rebates has been so inadequate, over so many years, that GPs are just, either going out backwards or they're saying "well, patients simply have to make a contribution, we can't subsidise Medicare any longer".

FAINE: Do you have data, do you have figures on the rate at which GPs are abandoning bulk-billing?

PHELPS: There have been three successive quarterly declines now in bulk-billing rates, and we are down to about 77% of general practice services bulk-billed. I think we will see a sharpening in that decline over the coming year because GPs have basically had a gutful. They know that the Government is really not interested in increasing the Medicare rebate. We haven't heard any assurances from the ALP that they will do anything much different at this stage. Really, we've got to remember that the Medicare rebate is an insurance rebate for patients … for the last 30 years or more … many GPs have been accepting that rebate from the patient as the full fee by directly billing the government, rather than billing the patient. Because the insurer, Medicare, just simply hasn't kept up with the pace of the cost of running a practice, then GPs basically have to just charge what they need to charge in order to make a reasonable living and cover their costs.

FAINE: Is there a snowball effect, Dr Phelps? In other words, if a large practice abandons bulk-billing in a suburb, does that let the other nearby and neighbouring practices off the hook, and they can do it, too?

PHELPS: I think the crunch has really come for all general practitioners at a similar kind of time in history. We've had this so-called Memorandum of Understanding between the Government and some of the GP groups, which really hasn't delivered to GPs what they hoped that it might in terms of relief of financial pressure on them. And I think that they're just really saying, "well, this is really silly". They're looking at other professions, they're looking at tradesmen who are earning far in excess of what GPs are currently earning if they bulk-bill through Medicare, and saying, "well, I've got this enormous responsibility, I work very long hours, I have high overheads, and I just don't want to be operating on the margins of financial viability anymore".

FAINE: You make an interesting point, but you didn't answer my question. If you have one large practice in a suburb that abandons bulk-billing, does that mean the adjoining practices feel that they're let off the hook, and they will drop it too?

PHELPS: Well, I did answer your question. I said that the crunch is coming for a number of different practices all at the same time. I think that probably the converse to your question is that you might have had practices that were holding on for grim death, thinking that nobody else is giving up bulk-billing, thinking "I will lose my patient load to the other practices if I stop bulk-billing".

FAINE: Yeah. I mean, they are in competition. It's a business for them.

PHELPS: Yes, indeed. But you can compete yourself to death, as we've seen in the airline industry as well, and I don't think that is in anyone's interest - not patients, not doctors.

FAINE: So where do you call for the circuit breaker to come from? You've called on the Federal Government for a long time now to pump more money in and, as you say, the Opposition is no closer to doing it than they are?

PHELPS: I think there are two things that can happen. Well, there are a number of things that can happen. The first one is that things can go along as they are, and patients will simply have to recognise if they value the services of general practice then they will simply have to pay an increment over and above what their insurer is prepared to pay. The second thing that can happen is… you know, the problem with that is it doesn't give protection to the needy and the disadvantaged…

FAINE: …Yep…

PHELPS: …and the people with chronic illness. Now, the medical profession is …I mean, I think that the situation with Medicare has reached this point because the good nature and the goodwill of doctors has been exploited to an extent. So, the other thing we can do is to look at increasing the Medicare rebate substantially for people who are disadvantaged or who have a chronic illness. That's the second option. Another option is to say "Well, Medicare, we value and we will fully fund it, and whatever that takes we will make sure that Medicare is appropriately funded". And in order to do that we have to take notice of a combined AMA and Government study called the Relative Value Study, which found that the 15 minute consultation with a GP, on average 15 minutes should be remunerated at around $45 to $50, and not at the current $23.45. That's the shortfall.

FAINE: That's a big gap isn't it. Just finally, Dr Phelps, I've been waiting for that chance to ask you what you think will happen to health policy in the looming federal election if Dr Michael Wooldridge, the Health Minister, has decided not to contest the election, and to resign and to retire from politics? Who is going to do the Government's hard yards on health policy in the election campaign?

PHELPS: We don't know yet.

FAINE: What impact will that have?

PHELPS: Well, I think it will have a significant impact, but I would like to think that Dr Wooldridge will stay with the health policy area until the election, and focus very hard on what can be achieved between now and the election, even though it is only a few months away. I think the Australian voters need and deserve to have well articulated health policies from all of the major parties in the lead up to an election. Even though we have tragic events from overseas, and serious problems, for example, in the airline industry and with asylum seekers in this country that need to be addressed, we also have the fundamental issues of concern for the electorate - those being, I believe, health and education. And health must have a very high priority at this election. And we are waiting to see fully costed election policies from all of the major parties, and we will be commenting on those policies as they emerge.

FAINE: Look forward to speaking to you again, then. Thanks for your time.

PHELPS: Thank you, Jon.

Ends