Health costs rise as rebate freeze bites

Patients face higher out-of-pocket costs as the medical profession struggles under pressure from the Federal Government’s Medicare rebate freeze.

As a result of the Government’s freeze, the gap between the Medicare rebate and the fee the AMA recommends GPs charge for a standard consultation will increase to $40.95 from 1 November, up from $38.95, continuing the steady devaluation of Medicare’s contribution to the cost of care.

The increase comes on top of the effects of the Medicare rebate freeze, which is forcing an increasing number of medical practices to abandon or reduce bulk billing and begin charging patients in order to remain financially viable.

Adding to the financial squeeze, the Government is considering changes that would cut the rents practices receive for co-located pathology collection centres that the AMA estimates would rip up to $150 million from general practice every year.

Under the changes recommended by the AMA, the fee for a standard Level B GP consultation will increase by $2 to $78, while the Medicare rebate remains fixed at just $37.05.

AMA Vice President Dr Tony Bartone said doctors had kept medical fee increases to a minimum, but Medicare indexation lagged well behind the cost of providing medical care.

“The MBS simply has not kept pace with the complexity or cost of providing high quality medical services,” Dr Bartone said.

The rise is roughly in line with Reserve Bank of Australia forecasts for underlying inflation, currently at 1.5 per cent, to rise anywhere up to 2.5 per cent by the middle of next year, and reflects steady increases in medical practice costs.

Staff wages, rent and utility charges have all increased, as have professional indemnity insurance premiums, continuing professional education costs and accreditation fees.

While practice running costs are rising, the Government’s contribution to the cost of care through Medicare has been frozen for more than two years, and in many cases far longer.

The Medicare rebate for GP services has not been indexed since mid-2014, while the last rebate increase for most other services was in November 2012. In the case of pathology and diagnostic imaging the rebate freeze is even longer, going back more than 15 years.

Dr Bartone said the rebate freeze was pushing up patient out-of-pocket costs.

“Many patients will pay more to see their doctor because of the Medicare freeze,” he said. “The freeze is an enormous burden on hardworking GPs. Practices cannot continue absorbing the increasing costs of providing quality care year after year. It is inevitable that many GPs will need to review their decision to bulk bill some of their patients.”

The AMA is pressing the Government to reverse the rebate freeze, and AMA President Dr Michael Gannon has declared he would be “gobsmacked” if it was still in place by the time of the next Federal election, due in 2019.

But Health Minister Sussan Ley has played down hopes that indexation will soon be reinstated, warning that there will not be a change of policy “any earlier than our financial circumstances permit”.

The Government is trying to curb the Budget deficit and rein in ballooning debt.

As part of its strategy, it is increasingly pushing the cost of health care directly onto patients.

Australian Institute of Health and Welfare figures show the Commonwealth’s share of the nation’s health bill slipped down to 41 per cent in 2014-15, while patients’ share has increased to almost 18 per cent, and Australians now pay some of the highest out-of-pocket costs for health care among Organisation for Economic Co-operation and Development countries.

The cost of health

How AMA recommended fees compare with the frozen Medicare rebates

Medical Service	AMA Fee (2015)	AMA Fee (2016)	MBS Schedule Fee (2016)
Level B GP consult (MBS item 23)	$76.00	$78.00	$37.05
Level B OMP consult (MBS item 53)	$76.00	$78.00	$21.00
Blood test for diabetes (MBS item 66542)	$48.00	$49.00	$18.95
CT scan of the spine (MBS item 56219)	$990.00	$1,055.00	$326.20
Specialist – initial attendance (MBS item 104)	$166.00	$170.00	$85.55
Consultant Physician – initial attendance (MBS item 110)	$315.00	$325.00	$150.90
Psychiatrist attendance (MBS item 306)	$350.00	$355.00	$183.65

Adrian Rollins

[Comment] Pursuing excellence in graduate medical education in China

Unquestionably, one of China’s primary challenges in health-care reform is improving the quality of clinical services.1 Patients who seek quality of care bypass poorly staffed primary care facilities for long waits in congested hospitals. Unsatisfactory quality of care is a major source of conflict between patients and doctors. Health inequity in China is due less to a shortage of health-care workers and more to abundant yet poorly educated service providers, especially in rural areas. That is why seven Chinese Government ministries in 2013 jointly launched the Standardized Residency Training (SRT) programme, which consists of 3 years of residency training after 5 years of medical school.

Government pathology changes could cost practices up to $150m

Federal Government plans to change the rules regarding rents for pathology collection centres could be a disaster for medical practices, ripping up to $150 million a year from their income, the AMA has warned.

AMA President Dr Michael Gannon has told Health Minister Sussan Ley that a significant number of general practices will become “collateral damage” if the Government persists with plans to change the definition of ‘market value’ that applies to rents for pathology collection centres, with serious consequences for the provision of health care.

Dr Gannon said the Minister needed to re-think the proposed changes and adopt a more nuanced approach “consistent with the original intent of the…laws”.

“If you do not get this right, a significant proportion of general practices will become collateral damage, which would be a disastrous policy outcome and contrary to your stated support for the specialty,” he told Ms Ley.

Last month it was revealed that the Government had put off plans to axe bulk billing incentives for pathology services and abandoned its threat to impose a moratorium on the development of new collection centres.

In a climb-down, the Government pulled back from its threat to scrap the incentives on 1 October and advised it would not be proceeding with the moratorium, which was announced during the Federal election in order to head off a protest campaign by the pathology industry against the axing of a bulk billing incentive.

Instead of a ban, the Government has directed that collection centre leases be put up for renewal every six months, down from the usual 12 months, until a new regulatory framework is put in place. Existing leases will be grandfathered for up to 12 months, after which the new rules will come into effect.

The bulk billing incentive cut, meanwhile, which was originally due to come into effect from 1 July and save $332 million, will now not be implemented until 1 January 2017.

“Bulk billing incentives for the pathology sector will continue until new regulatory arrangements are put in place and the Government will continue to consult with affected stakeholders,” a spokesman for Ms Ley told the Herald Sun.

But the Minister is persisting with plans to change the regulations governing rents for approved collection centres, particularly regarding the definition of market value as applied under the prohibited practices provisions of the Health Insurance Act.

Dr Gannon said that in talks earlier this year, the AMA had agreed with moves to strengthen compliance with existing regulations and “weed out examples of rents that are clearly inappropriate”.

But he said the Government at that stage had given no hint it was considering changes to the regulations, and its election announcement had taken all stakeholders, except Pathology Australia and Sonic Healthcare, by surprise.

Dr Gannon said the Government’s clear intent was to control collection centre rents, and the AMA opposed the proposed changes.

There are more than 5000 collection centres across the country, many co-located with medical practices.

“These practices are small businesses and have negotiated leases in good faith,” Dr Gannon said, and had made business decisions based on projected rental revenue streams, including staffing and investment.

He warned that ripping this source of revenue away could be disastrous for many.

“For many practices feeling the impact of the current MBS indexation freeze, this source of rental income has helped keep them viable,” he said, adding that AMA estimates were that the Government’s changes would cost practices between $100 million and $150 million a year in lost rent revenue.

“The magnitude of this cut goes well beyond an attempt to tackle inappropriate rental arrangements. It is causing significant distress, particularly for general practice,” Dr Gannon said. “I doubt the Government truly contemplated the extent of the impact of its election commitment when it was announced.”

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Terms set for GP registrars

The AMA has helped broker an agreement on the terms and conditions for employing GP registrars for 2017-18.

The agreement, between General Practice Registrars Australia (GPRA) and General Practice Supervisors Australia (GPSA), replaces the 2015-16 agreement, which was set in December 2014.

The National Terms and Conditions for the Employment of Registrars (NCTER) 2017-18 has been reached three months earlier than in the past, giving registrars and practices more time to negotiate their employment arrangements for 2017.

It covers GP registrars undertaking Australian GP Training in all general practice terms of training, although those employed in community controlled health workplaces, the Australian Defence Force, or in remediation may be bound by other contractual arrangements.

GPSA Chair, Dr Bruce Willett, said his negotiating team relied heavily on supervisor and training practice feedback to set the terms.

There has been no increase to the base rates nor percentages, due to the existing Medicare freeze, rising costs, and the freeze on training practice subsidies.

GPRA Chair, Dr Jomini Cheong, said that the new agreement provided greater clarity around issues that had previously been open to interpretation.

Both organisations agreed that the NCTER 2017-18 represented the fairest possible outcome for both training practices and registrars, given the current political and economic environment.

The NCTER again requires that registrars be engaged as employees, and allows for percentage payments to be made on a billings or receipts basis not less than every three months.

The NCTER is a goodwill document that applies because of the agreements in place between the Australian Government and the Regional Training Organisations (RTOs), which require training practices to observe it.

Dr Willett and Dr Cheong thanks the Australian Government, the RTOs, and the AMA for their ongoing support and promotion of the NCTER.

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Your AMA Federal Council at work

What AMA Federal Councillors and other AMA members have been doing to advance your interests in the past month:

Name	Position on Council	Activity/Meeting	Date
Dr Tony Bartone	Vice President	Launch of the Revalidation Model	16 August
Dr Tony Bartone	Vice President	MBS Review After Hours Working Group	13 September
Professor Geoffrey Dobb	AMA Board Member	Health Star Rating Advisory Committee	9 August
Dr Richard Kidd	AMACGP Chair	Health Care Home – Payment Mechanism Working Group	8 September
		TGA codeine upscheduling regulation impact analysis meeting	18 August
		Health Sector Group (HSG)	13 September
Dr Kean-Seng Lim	Member AMA Council of General Practice	Health Care Home – Patient Identification Working Group	19 August
Dr Brian Morton (Proxy for Richard Kidd)	AMA Member and Former AMACGP Chair	PIP Advisory Group (PIPAG)	14 September
Dr Gino Pecoraro	Obstetricians and Gynaecologist specialist	Launch of the Revalidation Model	16 August
Dr Anne Wilson	Member AMA Council of General Practice	National Immunisation Committee	22 September

Govt adviser calls for public hospitals to be ‘contestable’

Mortality rates and treatment outcomes for individual hospitals and medical practitioners could be made publicly available and patients given a choice of hospital and specialist under Productivity Commission proposals to improve the quality and accessibility of health services.

In the preliminary findings of a review initiated by Treasurer Scott Morrison into options for increased competition and consumer choice in the $300 billion human services sector, the Commission has proposed increased information disclosure by hospitals and practitioners and greater contestability between services.

“Greater competition, contestability and informed user choice could improve outcomes in many human services,” the PC said. “Well-designed reform, underpinned by strong government stewardship, could improve the quality of services, increase access…and help people have a greater say over the services they use and who provides them.”

Mr Morrison said he had ordered the review to improve the efficiency and cost effectiveness of human services.

But Opposition leader Bill Shorten, reprising Labor’s scare campaign during the Federal election on the privatisation of Medicare, said he feared it would be used to justify the wholesale handover of human services to the private sector.

“We’ve all seen this move before,” Mr Shorten said. “When Malcolm Turnbull and the Liberal Party start talking about changing human services it means that poor people get it in the neck.”

The Commission said that not all human services were amenable to increased competition, contestability and choice, but identified public hospitals and palliative care services among six priority areas targeted for reform.

While Australian public hospitals performed well by international standards, “there is scope to improve”, the PC said, including by matching domestic best practice and publicly disclosing more information.

“Public patients are often given little or no choice over who treats them or where. Overseas experience indicates that, when hospital patients are able to plan services in advance and access useful information to compare providers (doctors and hospitals), user choice can lead to improved service quality and efficiency,” the PC said.

It said that any reforms to boost user choice would have to be supported by “user-oriented information”, and suggested the English model in which increased choice is offered at the point where GPs refer patients to a specialist.

The Commission said experience in England had shown that patients given a choice of hospital and consultant-led team sought out better performing providers, and hospitals in locations where competition was most intense recorded the biggest improvements in service quality.

In order to exercise their choice, patients had access to web-based information enabling them to compare providers according to waiting times and mortality rates, and could use an online booking service.

The enormous variety of Australia’s public hospitals, including big differences in the populations they serve, workforce arrangements and characteristics and the complexity of their links to the rest of the health system, militate against like-for-like competition – something the Commission admitted.

If such issues or political considerations made fostering direct competition unfeasible, the Commission instead suggested exerting pressure for improved performance by making the position of senior hospital managers more precarious.

“There have been difficulties in the past commissioning non-government providers, and lessons from these attempts should not be forgotten,” it said. “As a result, it may be more feasible to implement contestability as a more transparent mechanism to replace an underperforming public hospital’s management team (or board of the local health network) rather than switch to a non-government provider.”

The Commission said State and Territory governments could also take a more contestable approach to commissioning services when renegotiating service agreements with local health networks.

On palliative care, the PC lamented that a dearth of comprehensive, publicly available national data hampered accountability and helped drive big differences in the quality and range of services available.

It said there was little evidence that low quality providers were being held to account.

The PC acknowledged that the “emotionally taxing and psychologically distressing” environment in which a person was approaching the end of their life militated against making choices about palliative care.

“Taboos about discussing death can prevent this from happening,” the Commission said. “Patients often rely on medical professionals to initiate conversations about palliative care, many of whom are inadequately trained about, and intimidated by, holding such conversations.”

Notwithstanding such challenges, the PC argued that introducing greater competition, contestability and user choice in palliative care would improve outcomes and reduce current substantial variation in the quality of, and access to, services in different areas of the country.

To achieve this, though, “would require careful design to ensure that the interests of patients and their families are well served. Special measures for consumer protection may be needed”.

Indeed, even where reform ushered in greater competition and contestability, the PC said the unique nature of human services meant the Government would need to maintain strong oversight.

“Government stewardship is critical,” the agency said. “This includes ensuring human services meet standards of quality, suitability and accessibility, giving people the support they need to make choices, ensuring the appropriate consumer safeguards are in place, and encouraging and adopting ongoing improvements to service provision.”

Other priority areas of human services nominated by the Commission for increased competition and contestability included public dental services, social housing, services in remote Indigenous communities and grant-based family and community services.

Among those areas assessed for reform but not identified as a priority by the PC at this stage were general practice, primary health networks (PHNs), mental health services, community health services and child and family health services.

The preliminary report is open for submissions until 27 October, and the Commission is due to deliver its final report by October 2017.

Adrian Rollins

Oral health: an important consideration in patient care

Severe radiation caries, which caused major psychological distress to the patient, occurred in a 57-year-old man after treatment for recurrent squamous cell carcinoma in the base of the tongue. Despite a post-radiation caries prevention program, surgical and radiation complications caused an inability to maintain effective oral hygiene, resulting in the progression of radiation caries (Figure). One month after the photograph in the Figure was taken, the patient underwent total hip replacement surgery. During subsequent post-operative appointments, the patient received antibiotic prophylaxis but dental rehabilitation was delayed by 3 months to avoid potential early infection of the implant. This serves as a reminder to medical practitioners to encourage patients to seek regular dental care and consider a dental assessment before major surgery.

Figure

Central retinal venous pulsations

Diagnosing raised intracranial pressure through ophthalmoscopic examination

The ophthalmoscope is one of the most useful and underutilised tools and it rewards the practitioner with a wealth of clinical information. Through illumination and a number of lenses for magnification, the direct ophthalmoscope allows the physician to visualise the interior of the eye. Ophthalmoscopic examination is an essential component of the evaluation of patients with a range of medical conditions, including diabetes mellitus, systemic hypertension and conditions associated with raised intracranial pressure (ICP). The fundus has exceptional clinical significance because it is the only location where blood vessels can be directly observed as part of a physical examination.

Optic disc swelling and central retinal venous pulsations are useful signs in cases where raised ICP is suspected. Both signs can be obtained rapidly by clinicians who know how to recognise them. Although optic disc swelling supports the diagnosis of raised ICP, the presence of central retinal venous pulsations may indicate the contrary.

In the standard technique for direct ophthalmoscopy, the patient is positioned in a seated posture and asked to fix their gaze on a stationary point directly ahead. Pupillary dilation, removal of the patient’s spectacles and dim room illumination usually aid the examination. To start examining the patient, set the ophthalmoscope dioptres to zero — alternatively, a suitable setting would be the sum of the refractive errors of the patient and the examiner. Use the right eye to examine the patient’s right eye and vice versa. Using a slight temporal approach facilitates the identification of the optic disc, which also minimises awkward direct facial contact with the patient. Examine the red reflex at just under arm’s length. A pale or absent red reflex may suggest media opacity, such as a cataract. Next, on approaching the patient and obtaining a clear view of a retinal vessel, follow its course toward the optic disc. The presence or absence of venous pulsations should be appreciable (see the video at www.mja.com.au; pulsations of the central vein are clearly visible at the inferior margin of the optic disc). These pulsations, usually of the proximal portion of the central retinal vein, are most readily identified at the optic disc. The examination of the fundus should be concluded by visualisation of the four quadrants of the retina and examination of the macula.

Central retinal venous pulsations are traditionally attributed to fluctuations in intraocular pressure with systole, although this is may be an incomplete explanation.1 Patients with central retinal venous pulsations generally have cerebrospinal fluid pressures below 190 mmHg.2 Based on the results of Wong and White,3 the positive predictive value for retinal venous pulsations predicting normal ICP was 0.88 (0.87–0.9) and the negative predictive value was 0.17 (0.05–0.4).

This is important when considering lumbar puncture and when neuroimaging is not available. A limitation of this sign is that about 10% of the normal population4 do not have central retinal venous pulsations visible on direct ophthalmoscopy.4 The absence of central retinal venous pulsations does not, by itself, represent evidence of raised ICP; some patients with elevated ICP may still have visible retinal venous pulsations.

Papilloedema (optic disc swelling caused by increased ICP) may develop after the loss of retinal venous pulsations. This change in the appearance of the optic disc and its surrounding structures may be due to the transfer of elevated intracranial pressure to the optic nerve sheath. This interferes with normal axonal function causing oedema and leakage of fluid into the surrounding tissues. Progressive changes include the presence of splinter haemorrhages at the optic disc, elevation of the disc with loss of cupping, blurring of the disc margins, and haemorrhage. In later stages, there is progressive pallor of the disc due to axonal loss. A staging scale, such as that of Frisén,5 can be used to reliably identify the extent of papilloedema (Box).

Box –
Stage 4–5 papilloedema (5) showing disc and nerve fibre swelling, haemorrhage, loss of the optic cup and obscuration of the vessels at the disc margin

Source: Bruce AS, O’Day J, McKay D, Swann PG. Posterior eye disease and glaucoma A–Z. London: Elsevier Health Sciences, 2008.

Diabetes management — keeping up to date

The management of type 2 diabetes (T2D) is rapidly evolving with the introduction of an increasing number of new medicines, updating of guidelines and emerging clinical outcome data. Medicine selection for treatment of T2D has become increasingly complex — especially when considering the Pharmaceutical Benefits Scheme subsidy of certain medicine combinations. On the other hand, some things have not changed; optimising glycaemic control, managing risk of complications and promoting a healthy lifestyle are still the cornerstones of diabetes care. Despite the new medicines available for the treatment of T2D, prescribers should continue to individualise their choice of therapy at each point of escalation based on patient and medicine factors.

Beyond selecting the most appropriate therapy lies the challenge of improving adherence to diabetes medicines. Better adherence to medicines ensures that patients achieve their glycaemic targets and reduce the risk of short and long term diabetes complications. It is important to assess adherence before intensifying diabetes therapy, which may help identify adverse events.

An emerging change, opportunity and challenge for prescribers will be the use of biosimilars in diabetes management, beginning with insulin analogues. Biological agents come with their own set of efficacy and safety considerations, which may influence prescribing in primary care settings. The diabetes environment is soon to be affected by these considerations by way of the new insulin glargine biosimilar.

By being better informed about medicine choices, health professionals can help people with T2D to achieve improved glycaemic control, reduce associated long term complications and minimise medicine-related adverse effects. The new educational program from NPS MedicineWise — “Type 2 diabetes: what’s next after metformin?” — provides general practitioners, pharmacists, practice nurses and diabetes educators with the latest evidence on second and third line medicines for lowering blood glucose levels and with strategies for improving adherence to metformin therapy. To access the educational program, visit www.nps.org.au/diabetes.

GPs win an ePIP breather

Medical practices being pushed to the financial brink by the Medicare rebate freeze and other Government cuts have won a partial reprieve after Health Minister Sussan Ley pushed back the deadline on shared health summary uploads to early next year.

In a breakthrough following intense lobbying by the AMA, Ms Ley has advised GPs will be given until 31 January 2017 to comply with new rules that require practices to upload shared health summaries (SHS) for at least 0.5 per cent of patients every quarter to remain eligible for the Practice Incentive Program Digital Health Incentive.

AMA President Dr Michael Gannon, who has raised the issue at a several meetings with the Minister, said the decision was “very welcome”.

“GPs are already under significant financial pressure from the Medicare rebate freeze and other funding cuts, and the last thing they needed was to also lose vital PIP incentive payments,” he said.

The Government originally required practices to comply with the new eligibility criteria from May this year, but the AMA warned at the time that this would be unworkable for many practices and risked undermining the goodwill of GPs which was essential to making the My Health Record system a success.

In June, the AMA called for a moratorium on the new rules after a survey it conducted found that just 24 per cent of practices considered themselves able to comply, while almost 40 per cent said they would not be able to and 36 per cent were unsure.

Government figures show that in the first three months of operation, 1500 practices failed to meet their SHS upload target and 69 practices withdrew from the scheme altogether.

Dr Gannon said failure to comply had the potential to deliver a heavy financial blow to practices already under substantial financial pressure.

“If the Government had not relaxed its approach, close to a third of previously eligible general practices faced losing significant financial support,” the AMA President said. “In many cases, practices would have been more than $20,000 worse off. With so many already close to breaking point, this could have been disastrous.”

The Minister’s decision follows a resolution passed by the AMA Federal Council in August calling for a moratorium on the new upload requirements and urging the Government to investigate the reasons why so many practices were struggling to comply.

The Federal Council said the Government should get the Practice Incentive Program Advisory Group (PIPAG) to conduct the review and provide recommendations on what could be done to improve practice compliance.

Dr Gannon said the episode highlighted the importance of the Government heeding the views and advice of general practitioners and their representatives.

The Government had pushed ahead with its SHS requirements against the advice of all the GP groups sitting on PIPAG, and the AMA President said in future it should ensure that any changes to the PIP Digital Health Incentive were based on the Advisory Group’s advice.

Dr Gannon said the medical profession strongly supported the Government’s My Health Record, and the Minister’s decision to extend the SHS requirement deadline would help shore up the goodwill of GPs to support its successful implementation.

“It is pleasing that the Minister has recognised the concerns that have been consistently raised by the profession, and this decision provides some breathing space for practices,” Dr Gannon said.

“With adequate time, education, and support, many of the affected 1500 general practices may well begin to genuinely engage with the My Health Record, and eventually champion it.

“But it is important that the Government continues to review the implementation of the PIP Digital Health Incentive in consultation with PIPAG.

“We need to know why practices failed to comply, and ensure that any of these issues are addressed before the end of January deadline. If a large number of practices still cannot comply by the new deadline, we may still need to revisit the policy.”

Adrian Rollins