January 15, 2015

Public health

A bitter pill

By Russell Marks
A bitter pill
The government alienates doctors and patients over $20 GP fee

On 9 December last year, Prime Minister Tony Abbott at long last dropped his government’s plan to impose a $7 “co-payment” on patients visiting GPs. The plan had been political poison since it was unveiled in the May budget, in part because Abbott had not taken it to the 2013 election, and in part because it was seen as attacking the central tenet of Medicare: its universality. Instead, Abbott and his then health minister, Peter Dutton, announced that the Medicare rebate paid to GPs would be cut by $5 from July 2015, with the expectation that GPs would pass the additional cost on to their patients as a “price signal”.

It was a bewildering announcement, because it repeated the problems that the community had expressed in relation to the co-payment. And then on 23 December the government passed regulations that effectively would further cut the Medicare rebate by between $10 and $20.10 (according to whether GPs are “non-specialist” or “specialist”) for consultations lasting less than ten minutes. Those regulations were due to take effect on Monday 19 January, and were ostensibly aimed at arresting the drift towards so-called “six-minute medicine”, or very brief consultations. But after a storm of dissent this week, led by the AMA, the new health minister Sussan Ley returned from holidays this morning and immediately scrapped the new regulations.

Currently, consultations with GPs are classified as either “Level A” (if they’re under six minutes long) or “Level B” (if they’re between six and 20 minutes). Medicare rebates GPs different amounts for Level A and Level B consultations; those rebates are generally passed on to patients. The regulations signed into law by the governor general on 23 December would have altered the consultation lengths for each level: Level A appointments will now be up to ten minutes long, and those are the appointments specifically targeted by the rebate cuts.

But those regulations were not trumpeted by the government, and only trickled into the news this week after the AMA got no response to a letter its president sent to Abbott last Thursday. It seems clear that patients were to be adversely affected, either by greater out-of-pocket costs for short consultations or by longer waiting times. At present, most GP practices that don’t bulk-bill leave patients out of pocket by about the same amount when their consultation is long (Level B) or standard (Level A). From 19 January, both doctor and patient would have had an interest in extending their consultation beyond ten minutes – GPs were to claim more from Medicare, and patients’ out-of-pocket costs were to be greater.

As late as yesterday Abbott was defending the changes, arguing that they would encourage GPs to spend more time with their patients. The prime minister said that this is what the AMA had been clamouring for six months ago, and accused the AMA of being disingenuous and duplicitous. In response to the proposed $7 co-payment proposal, which originally was going to penalise GPs who continued to bulk-bill their patients (i.e. not charge the co-payment), the incoming federal president of the AMA, Sydney neurosurgeon Brian Owler, warned that the effect of the policy would be to drive GPs to see more and more patients in a bid to recover lost income. Forget six-minute medicine, Owler said: try four-minute consultations.

So Abbott and Dutton came up with these new, now scuttled, regulations. Incidentally, they also intended with their original co-payment proposal to encourage GPs to spend more time with their patients: the government argued that the co-payment would provide additional revenue for GPs, who would then be able to spend more time with each patient. That rationale was immediately undermined by the parallel announcement that most of the co-payment would go towards a new medical research fund.

*      *      *

The Abbott government believes the following of Australia’s primary health care system: that it’s too expensive in terms of the budget; that the lack of a price signal results in GPs overtreating patients; and that GPs are effectively abusing the current Medicare system by keeping consultation times to six minutes, which means they can squeeze in three patients – and thus earn triple the income – in every 19-minute slot.

There’s certainly a lot of anecdotal evidence around that supports some or all of those beliefs. But ideally, governments build policy on hard evidence. The drift towards six-minute medicine was exposed as a myth by a Sydney University study last year that looked at 35,000 GP consultations across 2012 and 2013 and found not only that the average consultation length was 14 minutes, but that the average length had not changed in more than a decade.

When the government talks of introducing a price signal, it’s using the language of market economics, which is probably inappropriate in the area of primary health. From a public health perspective, overtreatment at the level of preventative or primary health care is preferable to undertreatment, because prevention is so much less expensive than cure – especially when the problem is left untreated to the point that it results in hospitalisation. Yet this appears to be Abbott’s vision. On commercial radio yesterday, he responded to the AMA’s concern that patients faced with either greater out-of-pocket costs or longer waiting times would show up instead at hospital ER rooms by pointing out that ER waiting times for non-critical patients would work as a natural disincentive to that practice.

Abbott’s “economic” blueprint for health care in Australia is built ostensibly on fixing the budget. (This explains why the thrust of Abbott’s policies now is diametrically opposite to when he was health minister in the Howard government, when he tried to encourage bulk-billing.) To that end, Abbott seems prepared to reduce the amount of time Australians spend with GPs. But most of the panic about the contribution of Medicare to Australia’s so-called “budget emergency” is itself a furphy. Australia, with a universal health insurance system, spends about 9% of its annual GDP on health. The United Kingdom, with an even more “generous” universal health insurance system, spends slightly less (as a proportion of total income) on health. The United States, with no universal health insurance and an overwhelming reliance on private insurance, spends a staggering 18 per cent of its GDP on health care. Perceptions that Medicare is “blowing out” mostly ignore the fact that its greatest value is in preventing the escalation of conditions. If the government was serious about “fixing the budget”, it may be looking to spend even more on primary and preventive health care as a way of reigning in costs at the tertiary end.

For these and other reasons, the Senate was likely to disallow the new regulations after it begins sitting on 9 February. Labor, the Greens and four crossbench senators – Ricky Muir, Jacqui Lambi.e., Nick Xenophon and Glenn Lazarus – were all opposed to the changes, which means they were unlikely survive a senate disallowance motion. The government’s relationship with the Senate thus appears to be continuing in the same dysfunctional way as last year.

Sussan Ley was appointed on 23 December, the day the new regulations were signed into law. It’s clear that she’d been left something of a hospital pass by her predecessor, Dutton, who was this week voted the worst health minister in living memory in an Australian Doctor magazine poll. Dutton clearly didn’t consult with the AMA before introducing the 23 December regulations. Perhaps the most significant take-home message from all of this is that relations between the government and the AMA have almost completely broken down.  

*An earlier version of this article was published about an hour before Sussan Ley announced that the government would not proceed with the 23 December regulations. It has been updated in light of that announcement. In the earlier version the health budget figures quoted in the third-to-last paragraph were incorrectly stated as budgetary amounts, rather than as proportions of GDP. Thanks to those who pointed this out.

Russell Marks

Russell Marks is a lawyer and an adjunct research fellow at La Trobe University. He is the author of Crime and Punishment: Offenders and Victims in a Broken Justice System (Black Inc., 2015). 

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