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The cost of freezing general practice

Australia’s universal health insurance scheme, Medicare, began as Medibank in 1975 and aimed to provide “universal coverage of the population, equitable distribution of costs, [and] administrative simplicity”.1 Funded by the Australian Government, Medicare reimburses general practitioner services on a fee-for-service basis. General practice is the most widely used health service; 85% of the population see a GP in any given year.2

Currently, patients using GP services are either bulk billed or privately billed. Bulk-billed patients have no out-of-pocket expenses, and the GP receives a rebate directly from Medicare. Privately billed patients pay for their services at the fee set by the GP and claim the eligible rebate from Medicare.

In 1978, the rebate was decreased from 85% of the Medicare schedule fee to 75%, and bulk-billing was restricted to pensioners and socially disadvantaged people. Since then, federal governments have encouraged bulk-billing. In 1984, the rebate returned to 85% and bulk-billing was reintroduced for all patients. In 2004, incentives were introduced for GPs to bulk bill concessional patients (ie, children < 16 years of age or Commonwealth concession card holders).3 In 2005, the rebates were increased to 100%.4 These measures made it financially viable for many…