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Variation in outpatient consultant physician fees in Australia by specialty and state and territory

Gary L Freed and Amy R Allen
Med J Aust 2017; 206 (4): 176-180. || doi: 10.5694/mja16.00653

Summary

Objectives: To determine the mean, median and 10th and 90th percentile levels of fees and out-of-pocket costs to the patient for an initial consultation with a consultant physician; to determine any differences in fees and bulk-billing rates between specialties and between states and territories.

Design, participants and setting: Analysis of 2015 Medicare claims data for an initial outpatient appointment with a consultant physician (Item 110) in 11 medical specialties representative of common adult non-surgical medical care (cardiology, endocrinology, gastroenterology, geriatric medicine, haematology, immunology/allergy, medical oncology, nephrology, neurology, respiratory medicine and rheumatology).

Main outcome measures: Mean, median, 10th and 90th percentile levels for consultant physician fees and out-of-pocket costs, by medical specialty and state or territory; bulk-billing rate, by medical specialty and state/territory.

Results: Bulk-billing rates varied between specialties, with only haematology and medical oncology bulk-billing more than half of initial consultations. Bulk-billing rates also varied between states and territories, with rates in the Northern Territory (76%) nearly double those elsewhere. Most private consultations require a significant out-of-pocket payment by the patient, and these payments varied more than fivefold in some specialties.

Conclusion: Without data on quality of care in private outpatient services, the rationale for the marked variations in fees within specialties is unknown. As insurers are prohibited from providing cover for the costs of outpatient care, the impact of out-of-pocket payments on access to private specialist care is unknown.

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  • Gary L Freed1
  • Amy R Allen2

  • 1 Centre for Health Policy, University of Melbourne, Melbourne, VIC
  • 2 Melbourne School of Population and Global Health, University of Melbourne, Melbourne, VIC

Correspondence: gary.freed@unimelb.edu.au

Competing interests:

No relevant disclosures.

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access_time 03:06, 17 March 2017
Gordon Robert Wyndham Davies

The article by Freed and Allen does not include a background regarding the history of the medical benefits schedule and the role of government in setting fees and the following information is provided. The original schedule was based on what was regarded as the “most common fee” for a particular service and in fact varied from state to state. In passing I would note that doctors are required to individually set their fees because they must avoid collaborative fee setting and that the AMA Schedule only sets out those fee levels which are considered reasonable in general terms.
What has happened is that over many years, quite apart from the recent reimbursement freeze, the government has eroded the original schedule and that in the original terms the currently charged fees should be considered as the basis for a redetermination of the most common fee. Differences will always arise reflecting experience and seniority (and hopefully competence) of practitioners but these are likely to be less if the rebatable quantum is set at a level which reflects current real world practice.
It should also be noted that the AMA historically has opposed gap insurance on the basis that that there should be a cost signal to most patients although this is accompanied by an understanding that practitioners would exercise their discretion not to charge the gap for those in financial difficulty.

Competing Interests: No relevant disclosures

Assoc Prof Gordon Robert Wyndham Davies
University of Wollongong

access_time 08:41, 21 March 2017
Peter Smerdely

The article by Freed and Allen was not a review of initial fees of consultant physicians but rather a review of rates of usage of the "110" item number. It is incomplete and therefore any conclusions must be taken cautiously. Consultant physicians have access to a number of item numbers for their initial consultation, more than the "110" for their consultations. As a geriatrician, I was surprised to see that only 18% of geriatricians bulk bill. This conclusion is based on incomplete data and therefore may be inappropriate. I did not see any data on the "132" (Initial Consultation and Management Plan),"141" (Initial Geriatric Assessment and Management Plan) and "145" (Initial Geriatric Assessment and Management Plan at home) item numbers (which make up 80% of my practice for example). A more complete (and therefore more accurate) study would include all the initial consultation item numbers available to a consultant physician. We may discover that the numbers who bulk bill are very different. I look forward to a more comprehensive study.

Competing Interests: No relevant disclosures

Prof Peter Smerdely
St George Hospital, Sydney

access_time 05:31, 3 April 2017
john Raven

I learnt about this article from the local newspaper, the West Australian. The heading of the newspaper article was "WA Specialist Fees Verge On Fraud". It proved to be just a very ordinary populist article but it could have been much more vitriolic, it certainly would have been much more interesting to me and it would have been much more useful if Gary L Freed and Amy R Allen had used the commonly used Medicare Item No for a Consultant Physician's first Consultation.

Freed and Allen for their research paper used Item No 110 for which the Medicare Rebate since 1/11/12 has been $123.80. Since 1/11/07 in my practice as a Consultant Physician in the specialty of Clinical Haematology, I have used Item No 132 for which the Medicare Rebate since 1/11/12 has been $224.35. The same Item No has been used by other Consultant Physicians including general physicians, oncologists, immunologists, rheumatologists, neurologists and others. On only rare occasions have I used Item No 110. I shall be interested to see the next paper by Freed and Allen when they have revised their figures to include all the fees charged by Consultant Physicians for their 1st Consultations.

The introduction of Item Nos 132 and 133 by the Commonwealth Government on 1/11/07 was an intelligent act of magnanimity for which one also has to thank the Association of Consultant Physicians and the AMA. I might have thought that practices such as mine in suburban and rural areas would not have survived these last 10 years without the increase in fees. The newspaper article in the West Australian expressed worry about a fall in bulk billing rate.For those who may not know it, the Medicare Rebate for the Consultant Physician's ordinary follow-up consultation (No 116) since 1/11/12 has been $64.20.

Competing Interests: No relevant disclosures

Dr john Raven
Dr J L Raven

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