Dumped $5 GP copay! It is not over yet – 5 things you need to know!


Updated 5th March 2015

2015 welcome back!

FrogIt is fantastic to be back into the full swing of things.

For 2015, we have many new and exciting initiatives to share with you and our amazing clients. We hope you had a safe and well rested break over the holidays with your loved ones. 2014 had been an unprecedented and challenging year especially for those of you in healthcare.

As our Canberra politicians keep us all awake at night, we all plod on controlling what we can and not what we cannot. We say stay focussed on what you can do so you can stay focussed on what you do best. This year is about thriving in chaos. Health literacy is a new mantra for healthcare providers. GP’s may have won GP co-payment battle for now but there are more challenges.

As reported in the national media, do not pin your hopes on a chronic care lump sum. This will cause more problems than solutions in your practice. One thing we know for sure is there will be a 4 year Medicare freeze.  This does not require Senate approval. A Medicare freeze is like suffering chronic renal failure. You do not know it is happening until it is too late (this is a bit like our friend the frog). There has been a two year freeze on in the last few years. Prior to this Medicare rebates have been less than 1% p.a. far less than the increase the 3% p.a. annual CPI increases in the weekly wage.

Reducing bulk billing is not a choice but a responsibility. This is critical in ensuring that high quality and access to services does not deteriorate and destroy the very sustainability of a practice.

fast medicine 5 things you urgently need to know! Times are about to change dramatically….!

1. Expect to see a fall in your patient numbers

Any Medicare rebate cut or freeze will have a significant impact on your practice for many years to come. Overtime your practice maybe forced, to reduce bulk billing. Expect up to a 15-20% fall in demand. Many traditionally bulk billed service will be affected. It is important to appreciate that mothers are the greatest patrons of a medical practice. They bring in the kids, the spouse, Mum and Dad and the in-laws. This may have a significant downside flow on or multiplier effect if not managed carefully.

2. Revise your fees

An increase on the 1st July 2015 of a $14 to $19 gap is the only sustainable solution for patients that are not healthcare card holders or children. We note more documentation by a doctor is required in order to claim the item B consults. We will report more on this when the details are published. The biggest change that practices will need to fight for is a change in work culture.

Expect patients to be more demanding. This is a natural reaction. We all take more interest and care when we spend our own money on something. There is no point in getting angry but seeing this as a new and more viable opportunity in the long term, which it is.

3. Revise your business and clinical integration model of care there is a better way!

body-mass-index Practices will need to reconsider their existing service delivery model and start educating their workforce on how patients are treated.  Moving doctors away from item 23’s to healthcare prevention e.g. diabetes clinic can increase practice income up to $50k p.a. per FTE (full time equivalent) and doctors per FTE income $70k per FTE.

I was requested to present in front of 3 distinguished primary care Professors, a paper in November 2014 for the Great Pacific Medicare Locals in NSW on this issue. I have uploaded links as to the business case for using integrated care in practice and how many practice’s are missing out on Medicare income by not providing or claiming correctly their MBS and grant income. I have uploaded this paper below with some scenario’s worth considering. Please note this was before the Federal $5 rebate cut announcement.

Consider this information in light of your own practice arrangements. To this end, the fundamentals still hold true that you and the practice will be up to $50,000 p.a. financially better off if you implement a continuing care plan program properly. In the years to come, the worry of the $5 rebate cut will be seen as a good thing for practices and the community. Download* 1. How to make Integrated Service Delivery a reality from a financial point of view 2. Business Modelling Template v.3.1 PDF *Accounting clients of Health and Life will be forward full slides and working spreadsheet calculators at no charge. These will serve as a useful tool for getting the message out to practice owners and staff. 2015 we are rolling out after successful trials our external Traffic Light Performance monitoring service. The quarterly Traffic Light Report is a free mentoring chat to practice owners and practice managers to report on how they are going and what they need to be focused on and how.

4. How to change?

For more information on how to change your practice read Can you trust your doctor?. It starts by educating the owners and then practice staff. If everybody shares this vision then patients need to be engaged which this blog covers in our earlier posts. It needs to start from the top. If they are still not convinced then we are happy to have a chat with you or them about how to change. So far, many of our clients have embraced the idea and have not looked back. Those that have, have been least affected by the $7 co-pay and $5 rebate announcements during the year.

5. Where to from here?

DD Speaking to Practice Managers at a Esperance H&L Seminar The continuing care plan model, is the business model that practices should consider which is significantly more sustainable if it is established to operate efficiently and effectively. Alternatively do nothing, see more patients and risk a Medicare audit or burn out. A possible solution is to join, merge with like-minded practices. The silver lining is that well-run practices will find it easier to recruit and retain their workforce. Failing that many GP’s may see it is time to retire if they do not urgently seek to change how they work. For more information contact our office at pa@healthandlife.com.au for a no obligation chat  with David Dahm    our CEO and Founder of Health and Life – national Health Practice, Tax and Accounting Advisers since 1992.

If you are seriously considering the immediate positive benefits of a practice restructure or changing accountants who better understand your needs, we hope when you click on this link it will help.

4 comments on “Dumped $5 GP copay! It is not over yet – 5 things you need to know!”

  1. is there anyway surgeries can get partitions signed to lobby the government to forget about this whole issue? What is $7 today could likely be $20 tomorrow and the end of Medicare altogether. Our demographic is low income and a large elderly population. Our patients won’t be able to afford these changes.

    1. Lynn your idea will have the biggest impact if every surgery got their patients to sign a petition. All we have to do is knock one up and share it with every practice so they can put it in their waiting room. I am happy to distribute an appropriate petition.

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