Medicare rebate gap blows out to $200 physician initial consults


By Geir O'Rourke

10 Nov 2022

The gap between the Medicare rebate and the AMA’s recommended fee for a physician initial consult has blown out beyond $200, with the MBS subsidy rising just $2.55 despite rampant inflation.

The shortfall in MBS rebates for initial consults by other specialists such as dermatologists has also grown past $100 for the first time, following the release of the AMA’s annual fee list last week.

It comes as concerns rise about the number of patients delaying or avoiding specialist care due to out-of-pocket costs.

A major consumer survey earlier this year found 30% of people with chronic conditions were not confident they could afford healthcare if they became seriously ill. Some 14% said they could not pay for healthcare or medicine because of a shortage of money (link here).

The AMA has stressed its recommend fees – which rose 2-3% on last year – reflect the increasing cost of doing business, amid rises in staff wages and costs for necessities such as equipment, insurance and CPD.

On the other hand, this year MBS rebates were indexed by just 1.6% –equivalent to $1.30 for consultant physician subsequent attendance (item 116).

The equivalent item in the AMA’s fee list now stands at $168, some $86.95 higher than the Medicare schedule fee.

It stresses the list, distributed to AMA members annually, offers guidance only, with all medical professionals responsible for setting their own fees for their services.

It also remains relatively common for patients to leave with no pain to the hip pocket, with about 35% of specialist consultations and 89% of GP services bulk-billed in 2020-21, per Department of Health statistics.

But the upshot was often doctors and their practices eating the costs themselves in those cases, the AMA said.

The end of the Medicare freeze between 2018 and July this year had been welcomed but had not solved the underlying problem, it added.

“The many years of low or zero MBS indexation, and without any additional ‘catch-up’ upon indexation recommencement, continues to create a significant gap between the cost of providing medical services and Medicare patient rebates,” the AMA said.

“This continues to have a detrimental effect on the cost of medical care for patients, which exhibits as increased patient out of pocket costs and this is often unfairly blamed on medical practitioners’ medical fees.

“Government must increase the indexation rate in future years, well above and beyond the recent levels, to close the gap and reduce out of patient medical costs.”

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