Issue 23 / 20 June 2016

AUSTRALIANS need greater clarity around the true cost of medicine to help patients make informed decisions about their own health, experts say.

The authors of an editorial in today’s MJA describe private health care in Australia as a “menu without prices”, with patients undertaking care not knowing what financial burden it might bring.

Professor David Currow, from the Cancer Institute NSW, and Professor Sanchia Aranda, from Cancer Council Australia, wrote that health care costs continue to rise well above the consumer price index and may influence crucial patient decisions which can have detrimental health outcomes.

“A recent study in Asia showed the financial cost in those countries, with around 25% of people facing financial ruin and others dying, possibly because they could not afford treatment. This issue is growing here and urgently needs better data,” Professor Aranda told MJA InSight.

They believe that part of the problem is a “failure by medical practitioners to disclose all the financial costs affecting patients’ decisions”.

For example, although the information is publicly available, there is a misconception that there are long waiting public hospital lists for many surgical treatments.

“Indeed, national data demonstrate that public surgical waiting times for a sample of cancers are very short,” the authors wrote.

Although doctors are currently obliged to give this information as part of their financial consent obligations, Dr Aranda said there needs to be more.

“[There should be] a standard information approach at diagnosis and something like a patient advisor might help.”

Part of the problem is a lack of knowledge about the costs of specialised care. Medical practice outside of public hospitals is privately provided and GPs referring patients don’t necessarily know the full extent of surgeons’ fees and other financial consequences that might impact the patient.

Breaking down these barriers and bringing the costs out into the open is something that Dr Peter Sivey, senior lecturer in the Department of Economics and Finance at La Trobe University, advocates.

He wrote in The Conversation that he backs the idea for a website where Australians can see comparative price and quality information about specialist doctors.

“GPs’ fees are normally very transparent as people see them quite often. However, specialists should have to disclose their fees for the standardised Medicare consultations they provide and it should be published on publicly available media such as on the MyHospitals website or a ‘MyDoctor’ website,” he told MJA InSight.

“There is no reason why the government couldn’t make that a prerequisite for specialists claiming Medicare rebates. Given modern technology, pricing transparency should be very easy to achieve.”

The Royal Australasian College of Surgeons (RACS) has recently been working with Medibank Private to gain a better understanding of what doctors are charging.

President of the RACS Dr Philip Truskett told MJA InSight that they have found that 85% of surgeons are charging below the Australian Medical Association rate, which is considered a benchmark.

However, “there are some people who charge a lot more item numbers than one might expect,” he said.

Although the College hasn’t received many complaints about exorbitant fees, Dr Truskett said that they anticipate they may, once the community realises how concerned the College is about it.

“If a patient did complain to the College, we would enlist a peer group of surgeons to look at the case and at the cost and to see if it could be considered exorbitant or not,” Dr Truskett said.

An area that has seen media attention recently is the varying costs of prostate cancer treatments. One study found a huge variation in out-of-pocket costs, with some men paying less than $250 and others paying in excess of $30 000.

Dr Truskett said that he has been looking at the varying costs in prostate cancer treatment, but that it is hard to compare, as many patients are being offered robotic surgery which comes with significant facility costs.

“It does appear that robotics seems to generate a very high out-of-pocket cost for whatever reason. Some people are paying for the technology. Whether that’s beneficial or not is a whole different question.”

It’s these alternatives that the authors of the MJA editorial are concerned about.

“In the Australian context, financial disclosure is not only how much a procedure will cost but, crucially, whether there are alternatives that offer similar benefits at less cost to the patient,” they wrote.

In addition, the cost of the procedure may receive different Medicare or private insurance rebates, depending on the diagnosis.

Professor Aranda believes this “financial toxicity” is a growing concern.

“Some drugs are not covered by the Pharmaceutical Benefits Scheme (PBS) for certain indications; take PD-1 drugs like Keytruda, for example, it’s covered for melanoma but not for other tumours with a PD-1 target,” she explained.

“This is because the drug is registered by the drug company for one indication and not others as (there may be) insufficient evidence.”

She is hoping that a PBS review will take into account scientific changes “that shift us from a tumour site-specific approach to biological markers that might cut across different cancers”.

The problem is complex, but fortunately experts all agree that it needs to be addressed.

“The issue of financial toxicity in Australian health care requires open debate supported by population- and individual-level data on rapidly rising out-of-pocket costs, and advocacy that places patients’ outcomes at the centre of any debate about the profession’s increasing demands on patients’ wallets,” Professors Aranda and Currow concluded.

3 thoughts on “Specialist fee transparency crucial

  1. Max King says:

    people facing financial ruin and others dying, possibly because they could not afford treatment 

    To paraphrase Prof Aranda, how big is this problem here?  As fees grow  exponentially it will become bigger. The popularisation of the threat of the litigation (a la USA) would add to the cost of insuring a specialst (or even GP) practice and would be a contributor to exorbitant medical fees growth.

    Nevertheless, living has a price that many can’t afford. 

    They believe that part of the problem is a “failure by medical practitioners to disclose all the financial costs affecting patients’ decisions”.

    Part of the problem ???  I suggest that  unaffordability is  99% of the problem, and it would likely be a greater proportion if ALL of the costs were revealed. Long waiting lists are generally seen as related to non- life-saving procedures. It’s the cost, the money. c.f  the legal system, wealthy people can engage QCs, the rest take their chances with a public defender; and we know who nearly always win.  

    the College hasn’t received many complaints about exorbitant fees   

    LOL, the plain people of Australia know their place. Most would not dare to complain, and would never dream of complaining to the college. And then a group of  surgeons would look at the case – colleagues judging colleagues – secretly.

    The President of RACs said that “they” have found that 85% of surgeons charge below the AMA benchmark.Is that 85% correct? if so, the AMA benchmark must be over-inflated.

    Save lives by shaving fees.

  2. Mary Osborn says:

    The highest level of evidence for the treatment of non-melanoma skin cancer on the face is Mohs micrographic surgery (MOHs) followed by plastic surgery. These treatments reduce disfigurement and recurrence of non-melanoma cancers, essential in my case due to the site of the cancer. These treatments should be placed within a Chronic Disease Package claimable under the Medicare Safety Net, set up to assist people with out-of-pocket costs for their out-of-hospital Medicare services and which offers an MBS rebate. However Plastic surgery for skin grafting after MOHS, and MOHS are not covered under this rebate.Non-melanoma skin cancer continues to be a major public health problem in Australia, involving significant health costs and disfigurement from both the disease and its management. Plastic surgery is also not easily accessible or available on Medicare because of financial limitations and type of service delivery.
    I have been a public patient at the dermatology clinic of the Royal Prince Alfred Hospital (RPA) in Sydney for over twenty years for treatment of non-melanoma skin cancers. Most recently my MOHS involved the treatment of a non-melanoma skin cancer on my nose requiring me to have MOHS followed by plastic surgery. This was the best available treatment, with the lowest risk of a non-melanoma skin cancer recurrence.
    I do not have private health insurance. I am willing to pay my annual Medicare levy of an average $2000-$3000 as I believe this supports Medicare and the public health system. The MOHS and plastic surgery cost me over $10,000 with only one-third of the cost refundable under Medicare.
    Yours sincerely


    why not publicise the real cost of public medical care.

    Why not document the full costs :

    inpatient bed stay

    surgical costs

    drug therapy 

    chemotherapy/radiotherapy if required.

    Let the public understand that the medicare levy covers a small fraction of their treatment true cost. 

    Maybe it is time to assess the cost /benefit ratio for treatments and make an economic judgement on whether certain treatments should be available – not just this treatment can be used in spite of failure of all other treatments. 

    Is it time for economic ethics rather than continually increased the cost of medicine?


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