“The AMA is actively involved in making sure that people have informed financial consent about the costs of their treatment, and that includes knowing what health funds are prepared to pay their customers for particular treatments,” AMA President, Dr Tony Bartone, said.
“The AMA has contributed to the Minister’s advisory committee, and will continue to work with the Government to ensure that Australians get what they want and need – transparency on their out-of-pocket costs before they have treatment.
“But let us be clear about why we have out-of-pocket costs in the first place. The three contributors to out-of-pocket costs are: 1) the doctor’s fee; 2) the Medicare rebate; and 3) what the health fund will pay. Let’s also be clear that 87 per cent of services are billed under a no-gap (zero fee to patient) arrangement.
“The AMA supports and actively encourages full transparency of doctors’ fees, and unreservedly condemns egregious billing, which occurs in a very small percentage of cases.
“But that transparency must extend to both the size of the MBS rebate and the private health insurance contribution to the cost of treatment.
“While it appears that this website will include information about MBS rebates, will it show the specific rebate for a given procedure, or just the average out-of-pocket cost in tiers?
“Will it also inform patients that MBS rebates for specialist services – paid for by their taxes – have failed to keep pace with inflation for more than three decades?
“Most importantly, will it show what health funds are prepared to refund to their customers for years of premium payments?
“Health funds have argued that the complexity of their many different insurance policies makes it unworkable for them to provide their rebates for a comparison website.
“We agree that health insurance policies are unnecessarily complicated and opaque. Each insurer sets the rebate amount that they are willing to pay. If the insurer’s rebate is low, the out-of-pocket cost to their customer will be high.
“Even when a doctor charges the same fee every time, and even when the patient has good private health coverage, out-of-pocket costs can vary by thousands of dollars because of the variation in what the insurer chooses to pay as a rebate.
“For example, my predecessor as AMA President, Dr Michael Gannon, an obstetrician, has to have 17 different fee schedules for the same procedure, simply so that he can comply with the 17 different rebates paid by health funds to meet their no-gap requirements for that one procedure, to make sure that his patients are not left out of pocket.
“If a patient doesn’t come under a no-gap scheme, they are entitled to an estimate of likely costs, and the AMA is absolutely clear on this.
“Informed financial consent requires total transparency. Unlike the growing range of privately-funded fees websites that now exist, a Government-developed website must be impartial and backed by the Commonwealth’s extensive data set.
“However, a website that does not have the full information is not in anyone’s interests.
“While the Government is saving money with the continuing freeze on MBS rebates for specialist procedures, allied health consultations, and diagnostic imaging, the growing gap between rebates and the cost of providing care is passed on to the patient.
“We welcome the announcement that the Government will fund an education campaign about health financial literacy and informed financial consent. This is critically important to navigating Australia’s complex health system.
“This education initiative must be broad enough to equip consumers to make informed choices about their health insurance products, as well as their choice of doctors.”
Australian Prudential Regulation Authority (APRA) statistics show that 95 per cent of specialist medical services are billed under a no-gap or known gap billing arrangement. In the December 2018 quarter:
- 87.7 per cent of services were provided with no medical gap;
- 7.4 per cent of services were provided with a known medical gap; and
- 95.1 per cent of services were provided under a no or known gap arrangement.
According to the Australian Institute of Health and Welfare (AIHW) report on patients’ out-of-pocket spending on Medicare services 2016-17:
- 21 per cent of out-of-pocket expenditure for individuals is on total medical costs, which includes hospital and non-hospital services;
- 37 per cent is on prescription and non-prescription medicines; and
- 19 per cent is on dental services.
2 March 2019
CONTACT: Maria Hawthorne 02 6270 5478 / 0427 209 753