Geographic variation in out‐of‐pocket costs for radiation oncology services

To the Editor: I refer to Liu et al's1 thought‐provoking analysis of out‐of‐pocket costs for radiation oncology services according to geography. Notably the dichotomous demarcation of location by Australian Standard Geographical Classification (ASGC; 1 = major city, 2 = other) significantly limits the impact of their intended message.

Of interest is radiation oncology delivery volume by certain centres and out‐of‐pocket costs. A private provider (Area 9) with a major city postcode and least Index of Relative Socioeconomic Disadvantage (IRSD) quintile provides service at 80% bulk‐billing rate, possibly due to high volume (third highest in the study). However, a public centre with even higher volume, located in same IRSD quintile but non‐major city postcode (Area 19) appears to bulk bill just 25% of the time, with the highest maximum out‐of‐pocket cost per episode and the fourth highest mean costs.

Three public and four private providers apparently provided service to fewer than 200 patients between 2006 and 2017. They may be newly established during this period, but, even so, setting up a radiation oncology centre for fewer than 30 episodes within one year (minimum period) needs significant economic rationalisation.

Radiation oncology services require high capital start‐up costs in a suitable setting, at a location able to access sufficient patient volume to justify the significant financial and staff investment needed upfront. For private providers, it takes many years for these centres to turn a profit, particularly in ASGC 2 areas at the current Medicare Benefits Schedule rebate rates. It is therefore not surprising most private centres are located in major cities in postcodes with IRSD 3–5 offering non‐bulk‐billing services, as their episode numbers are lower than the mean.

Although participants living in major city postcodes exclusively serviced by private radiation oncology providers can access services in other cities, the economic and personal costs (including a support person for the travel) may not be adequately offset by bulk‐billing or the travel reimbursement scheme.

Furthermore, radiation oncology utilisation (and associated survival) appears to be more affected by the patient's socio‐economic status and distance to the nearest radiation oncology centre2,3,4 — both can be related but not equivalent to geographical address. More care is needed interpreting the role of geography in radiation oncology utilisation and out‐of‐pocket costs.