Issue 21 / 6 June 2016

“BULK-billing rates have continued to rise.” It’s the oft-quoted remark to justify the adequacy of health financing and freezing of the Medicare rebate for patients who attend general practitioners.

Broadly interpreted as a measure of finance adequacy and affordability to general practice, questions are now being asked about whether it continues to be relevant as a health economic indicator.

GPs point to the changing landscape of Medicare Benefits Schedule (MBS) based primary care and the associated indicator, the “average out-of-pocket” expenses, to argue that the bulk-billing indicator is being misinterpreted and inappropriately used.

As an indicator of health funding, the bulk-billing rate came to prominence politically as an election issue in 2003–2004. Low and declining bulk-billing rates prompted the then Minister for Health Tony Abbott to increase Medicare rebates and to add bulk-billing incentives to bolster an affordability argument and floundering electoral prospects. Since that time, bulk-billing rates have continued to climb.

Once a sign of affordable access to primary health care, the high bulk-billing rate has now become a banner for the moral hazard. Too much of a free thing leads to greater demand and overuse of GP health care and high health costs.

But is that true? The weakness in the bulk-billing rate starts with its calculation, which is based on services rather than at a patient level. That is, 83% of services are bulk billed – not 83% of patients are bulk billed.

Patients do not access Medicare equally. Data from the National Health Performance authority confirm that the top 12.5% of patients utilised 41% of Medicare out-of-hospital services.

The very high and frequent GP attenders are more likely to be older, have multiple chronic diseases and live in areas with the most socio-economic disadvantage. These 12.5% of patients are the ones who significantly account for much of the bulk-billing figures, which leaves the majority of the population with much lower rates of bulk billing.

To appreciate the full picture, the related economic indicators of affordability need to be considered, particularly the out-of-pocket expenses.

The out-of-pocket expense indicator is rarely raised or discussed at a political or community level, but has more than doubled in the last decade and now stands at approximately $32 per consultation. The impact of this cost is reflected by the Australian Bureau of Statistics patient experience indicators for the lack of affordability for GP services, and the increasing use of hospital accident and emergency services.

The rising level of patient costs casts doubt on the veracity of the bulk-bill indicator as a single measure of affordability. It strongly counters the moral hazard argument, indicating that there are already cost barriers to accessing general practice.

So what does a rising bulk-billing rate really mean?

Rising GP bulk-billing rates may simply be a reflection of broadened access to the MBS and a proliferation of health services which use the MBS as an addition to, rather than a basis for, funding.

Primary health care has changed significantly in recent years, and particularly in the last decade. Medicare has allowed and broadened MBS access to several non-government and state government organisations, which now include:

  • the Royal Flying Doctor Service
  • Aboriginal medical services
  • bulk-billing clinics in public hospitals
  • headspace clinics
  • medical services for the homeless
  • family planning clinics
  • alcohol and drug services and centres
  • academic (hospital-based) general practice units
  • not-for-profit rehabilitation centres
  • women’s health centres
  • refugee health centres

These organisations use Medicare as an additional funding source to complement other federal, state or private finances. They are not dependent on the MBS to support their enterprises, and have less sensitivity to rebate changes for financial survival than many private general practices.

No-one is saying that these sources should not receive MBS funding – they are models which increase the bulk-billing rate, but by the same token, they are not small business general practices where real business cost pressures exist.

At the other end of the scale, consolidation of general practice into large, vertically integrated health corporates have become prominent in primary care based on the bulk-billing model. These models do not depend on general practice per se, but use high-throughput GP services as revenue raisers – that is, the ability to generate referrals to higher profit margin services like pathology, radiology and specialist services.

Finally, cooperative GP models, where an annual fee is paid, followed by yearly GP bulk billing are also becoming more common – a system which is being replicated in some nursing homes.

The key point with these models is that the additional patient costs are not detected by Medicare.

Hence, the bulk-billing indicator is misleading and “dirty” in that it does relate to the traditional view of general practice. It does not truly reflect either the adequacy of GP financing or the affordability for patients.

We are now in an era where there is a gross imbalance of health information tilted strongly in the government’s favour. The government restricts access to MBS data use, but readily forwards raw Medicare data which suits its purpose.

Quoting the raw bulk-billing rate in isolation as an indicator of affordability of general practice care is mischievous. It misrepresents the true costs of seeing a private GP and is being used to justify a political agenda.

The indicator is now beyond its usefulness date and its usage in isolation should be rejected.

Dr Evan Ackermann is a GP and chair of the RACGP Expert Committee on Quality Care.


Poll

The bulk-billing indicator is no longer useful
  • Strongly agree (69%, 119 Votes)
  • Agree (21%, 36 Votes)
  • Neutral (4%, 7 Votes)
  • Strongly disagree (3%, 6 Votes)
  • Disagree (3%, 5 Votes)

Total Voters: 173

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5 thoughts on “Bulk-billing indicator no longer useful

  1. Aniello Iannuzzi says:

    An excellent article that blows apart the myth of the bulk billing rate. 

    Until there is transparency in the statistics, they are useless. 

    In addition to what is listed in the article, there are other drivers to higher bulk billing, some of which as a profession we’re not comfortable confronting.

     

  2. Rhys Henning says:

    Bulk-billing inGeneral Practice makes little sense.

     In 2016  the Medicare Safety Net provisions that would support General Practice mean any Conession Card Bulk-billed patients [or families] pay $647.90 in a calander year [or less than $12.50 a week] before the safety net contributes 80% of the out of pocket cost of seeing the GP, Specialist, Allied Health Provider or radiolgist/pathologist.

    Medcare would work better if Bulk-billing CEASED and patients relied on the Safety Net.

    For non-concession patients [or families] the Safety Net cuts in at $2030 a year or less than $40 a week.

    To make the safety net work and in so doing support the Medicare system no-one except those that genuinely cannot manage the system [dementia patients] should be bulk-billed.

     

     

  3. Glenn Rosendahl says:

    Evan, I cannot agree with your heading.  I certainly agree that the ‘bulk-billing indicator is no longer valid – if indeed it ever was.  But the ‘indicator’ has proved very useful to the government, which is why it was trotted out.  ‘Beach’ is no longer.  It committed the cardinal crime of credibly contesting a government – blatantly political – statement.  It took on Tony Abbott and was – involuntarily – a major, effective protagonist in his demise.  Not deliberately, it simply wanted to cite – and defend – its statistically and rationally credible statement and position.  And it has paid the price.

    The government’s indicator statement did win it a minor skirmish, at least – at the time – in the public eye.  It does not warrant the descriptor ‘battle’.  Indeed, this government may not ‘win the war’.  But protagonists, of any and every persuasion, will trot out statistics that suit them.  They will have available ambiguous, ambivalent and nebuous descriptors that suit them.  Like ‘the bulk-billing rate’.

    You want precision and clarity.  That is the last thing a politican wants.  Simply an appearance of precision and clarity.

  4. Dr Louis Fenelon says:

    It’s a well put together article. Thanks.

    As a mixed billing GP, my mix is steadily climbing toward total bulk billing.  When you add all the paediatric, mental health, unemployed, retired and vets, there’s not many left to bill.  And they, to be honest often call the “after hours” Dr because they bulk bill their “emergency” home vists at times convenient for work.

    But hey, it’s all good medicine. Like all the hours of care planning referrals I do each week for patients who are grateful to receve complex and integrated care, so long as it’s for free.

    Medicare and bulk billing have always been perverted by politicians. Sadly right now all those obliged to subscribe to the Medicare system are being treated as a way to write off budgetary loss. 

    Keeping people healthy and out of hospital is bad for the budget and should be discouraged! Actually it is bad, via an aging and growing population, but I thought even the most dumbass polititian would realise it would look good within the term of their superannuation grab, er I mean term of parliament.

    Regardless of party in power the bureaucrats within the system will continue to disrespect and treat general practice as a means to their end. “The public system is failing, so let’s move on private general practice where it costs less to be in control….”

    My question is, if they replace the bulk billing rate with something else, how much worse will it be for GP’s?

  5. GEORGE QUITTNER says:

    I FIND BULK BILLING RATES VERY USEFUL

    It gives an excellent guide to just how sad an pathetic general practice has become.

    A hair dresser is appreciated more by her customers than is a doctor.

    No it is not about money.  It is the principle.

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