AMA President, A/Prof Brian Owler, National Press Club Q & A, 23 July 2014

Subject: Ensuring the sustainability of the health system

LAURIE WILSON: Thank you very much, Professor Owler. Don't sit down for too long. It's time for questions, and our first one today is from Dan Harrison.

QUESTION: G'day, Dr Owler. Dan Harrison from The Age and the Sydney Morning Herald. Thanks very much for your speech. I'd like to ask you a question slightly from left field about something that you didn't talk about in your speech. What do you think of the medicinal potential of cannabis? Do you think it should be made legally available more widely than it is currently, and if so, how would you achieve that?

BRIAN OWLER: Yeah look, it's obviously a very topical area at the moment, and the AMA's position about medicinal cannabis is that we recognise that it does have some therapeutic potential. But that needs to be assessed properly in a regulated way so that we actually get the best outcomes for patients.

Now, part of it needs to be that we take the emotion out of the debate from both those that are for and those that are against. I mean, I take the analogy of other medicines that we use, morphine, for instance. Now, morphine - we wouldn't think of not using morphine, but we use it for anaesthesia and for pain relief every day in our hospitals. Yes, it can be abused and it has harmful effects if it's used the wrong way.

So I think medicinal cannabis has to be assessed and regulated in that way, has to be assessed in a clinical trial so that we do actually understand where the benefits lie and how we can get the best results for patients. And we need to make sure that we get the preparations right, because smoking it or eating it is obviously not the best way, necessarily, to get the effects because there are other harmful things that can happen that way. So, there are other preparations that we need to investigate and use to get the best results for our patients.

LAURIE WILSON: A question from Laura Tingle.

QUESTION: Laura Tingle from the Financial Review. I'm interested - you've ranged very widely in the speech - but I was very interested in your comments about managed care, and do you think the Government is looking at such a system? Could you just tell us a bit more about how you think that is developing. Is it just because of the measures that have been taken at the edges with private health insurance and GPs that you have talked about? Do you think there is a clear view about where they're going, and what would have to happen legislatively for that to occur?

BRIAN OWLER: Yeah. So, we obviously do have concerns, and both private health insurers and the Government understands that a US-style managed care system is something that the public does not want. But it doesn't matter what name you call it. If it interferes with the doctor-patient relationship and interferes with the autonomy of being able to prescribe and dictate the sort of treatment that the patient should have, that is what managed care is.

Now, look the private health insurer's motivation is profit and it is market share and, while we understand that there are some areas in primary care where private health insurers may have a role, I think we need to be very careful about how that is done. It would require legislative change to allow them to insure for a gap, but I'm not sure that that is the road that we want to go down, because once we proceed down that road, we open it up to all sorts of problems.

I know that the Government is engaged very closely with the private health insurers and have asked them for information about how they might contribute. Clearly, the Government is looking for other contributions to the costs of health care, and private health insurers are one potential. But, at the end of the day, it's actually the patient that's still paying their private health insurance premiums, so it's just another way of asking the patients to fund their health care.

So, I just think it's an area that we need to be very careful in. We know that the private health insurers have had programs for pre-assessment for cosmetic procedures, and the problem with that is not about cosmetic procedures, it's actually about they're now using it to deny treatment for a range of other related conditions. And so, there is some examples about where you have this creep into the health insurers being able to decide whether or not you have the approval of someone - a clerical officer sitting in an office in Melbourne or Sydney - deciding whether or not you can go ahead and have that operation, and that's not sort of program that we want.

LAURIE WILSON: A question now from Sue Dunlevy.

QUESTION: Professor, Sue Dunlevy from News Corporation. You're here today fighting a $7 fee being imposed on GP visits. Don't you think it's slightly ironic, and perhaps hypocritical, that we never hear the AMA complaining about the three, four specialist visits that attract an average fee of about $100?

We wrote on the weekend about cancer patients who are facing $60,000 in out-of-pocket expenses. They've had to raid their superannuation to pay their medical bills. I've just got off the phone before I came down here to a gentleman who faced $17,000 in out-of-pocket expenses for prostate surgery.

You have argued against the doctors being required to publish their fees publicly. How do we re-balance the health market so that patients can get a better deal and not face such large out-of-pocket expenses if we can't get even the most basic information from a doctor and be able to compare his fees to another doctor's fees?

BRIAN OWLER: Yeah, look, it's a good question. I think - I mean, the AMA is not fighting against co-payments per se. I mean, I've said that repeatedly. The AMA is not against co-payments or private billing, and many of our doctors already charge well above $7. It is the problem with this proposal in the Federal Budget that doesn't have the protection there for vulnerable patients.

Now, in specialist practice, there is a whole different fee structure, a whole different practice cost, and we also had public health - public outpatients clinics, and I have outlined there are problems with that as well, obviously, but there are other avenues of seeking care. But I think what you really want to talk about is the specialists fees for things like procedures and surgery.

Now, as I have relayed to you previously, 89 per cent of our procedures actually are performed at a no-gap rate - at a no-gap cost or no out-of-pocket expense to the patient. Another four per cent are done under what's called a known gap arrangement, where the cost is usually about - well, up to about $500. Now above that, there are gaps that are charged, and gaps that are charged are done so for a variety of reasons. Some of it relates to the area of practice and the costs that are involved in the surgery.

One of the problems that we have had is that the Medicare Benefits Schedule has not kept pace with inflation. I think the rise has been about 2.8 per cent or something around that, which has actually been below the rise in the cost for specialists. So, that has precipitated some people charging a gap. We see Medibank Private has not indexed its fees in line with the MBS schedule for non-GP rebates from 1 July, and this is going to actually place more pressure on specialists to charge a gap.

Now, having said that, I will defend the ability of doctors to be able to charge the fee that they feel is appropriate for the services that they provide. On the other hand, I do not support - and the AMA does not support, nor, as I understand, does the College of Surgeons support - exorbitant fees where clearly patients are paying a very large amount out-of-pocket.

Now, all of those things should be done with informed financial consent. I think what we have in Australia is the ability to seek second opinions. You can seek second opinions about clinical conditions, but you can also seek second opinions about fees, and people do so on a regular basis. But to be able to advise someone over the phone about what my fee might be is not appropriate because I need to assess what operation that patient needs.

So, you might have two different surgeons and you might go to two different people. They may advise two completely operations which are perfectly reasonable, perfectly safe, and actually get good clinical outcomes. But it depends on the experience and skill of that surgeon about what operation they need, and that will dictate what the fees are going to be, and whether they might even need an operation at all.

So - and I think we should encourage people - if they do come across what they feel is an exorbitant fee, to go and seek a second opinion. Most of the private insurers actually have on their web sites the doctors that actually are listed to be in their no gap or known gap arrangements. So, I think what we are talking about is a very small group of people that are charging very exorbitant fees, but the vast majority of people are actually having their surgery with no out-of-pocket expenses, or at least a small gap.

LAURIE WILSON: Just on the issue of you'll be taking a plan about the co-payment alternative to the Government I think you said soon - in coming weeks. Can we expect that you will be releasing that plan publicly at that time, and can you add anything else about what you have got in mind without being too specific, because I obviously appreciate you don't want to lay it on the table in detail?

BRIAN OWLER: No.

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Brian Owler thank you very much for your comments today, congratulations on your elevation to the Federal President of the AMA. We look forward to talking to you again in the future, and we also look forward to seeing what that plan is that you've put to the Federal Government about the co-payment at some point. Thank you again.