Alarm grows over out-of-pocket impact on health equity

Jolyon Attwooll

13/04/2023 4:23:53 PM

New research indicates healthcare is becoming harder to access due to increasing out-of-pocket costs – particularly for vulnerable patients.

Money in wallet
Out-of-pocket payments for healthcare have been increasing in recent years.

Spiralling out-of-pocket costs pose a growing risk to Australia’s most vulnerable patients, doctors have warned.
It follows the publication of an article in the Medical Journal of Australia (MJA) focusing on the impact of out-of-pockets costs on health equity.
The report, written by University of Technology Sydney health economist Professor Emily Callander, states that around 15% of healthcare spending in Australia can be attributed to out‐of‐pocket fees.
That figure is almost double the amount contributed by private health insurers, Professor Callander writes, with Australia’s out-of-pocket costs placed higher than a number of comparable OECD countries.
Professor Callander also cited her previous research, which suggests one in three lower-socio-economic families spend 10% or more of their income on healthcare.
‘Although people with higher incomes may have the ability to pay to access private specialist care, such user fees cannot themselves directly contribute to the promotion of equity,’ the MJA article reads.
‘There is no direct transfer of out‐of‐pocket fees from people of higher socio‐economic status to those of lower socio‐economic status.
‘Out‐of‐pocket fees, and by extension government subsidies, do nothing to directly subsidise access for people of lower socio‐economic status who are unable to pay market prices.’
Dr Tim Senior, who recently co-founded RACGP Specific Interests Deprivation and Poverty, believes the MJA article is right to focus on out-of-pocket costs as one of the main barriers to accessible healthcare.
He says multiple consultations with a range of health professionals, combined with costs such as medications and visiting expenses, often amount to an impossible burden for low-income families.
‘For people without much money to start with, this takes up a huge proportion of their disposable income,’ Dr Senior told newsGP.
‘The decision to seek care at a particular time will often be balanced with other expenses, including essentials like food and rent.
‘Those without much money often have more demand on the health expenses because they have more multimorbidity at a younger age, and more disability, and so have less earning potential, but need more health professionals and more agencies involved in their care.’
While he says that paying out-of-pocket costs may subsidise those in need of bulk billing, he notes those benefits only occur within a specific practice. According to Dr Senior, the uneven spread of poverty is a key factor, with research indicating 13% of NSW locations account for 55% of the state’s most disadvantaged positions.

‘For practices serving these communities, if one patient needs to be bulk billed, most people need to be bulk billed,’ Dr Senior said.
‘Sadly, we are already seeing closures of practices in poorer areas, as bulk billing makes practices unviable.’
He believes discussions around Medicare reform have ‘largely ignored’ concerns about health equity – and believes the closure of clinics unable to make co-payments work in deprived areas will be hard to reverse.
‘It’s short-sighted health policy,’ he said.
‘It makes the health system more expensive, and less effective, as more people go to expensive hospital care with problems a GP can manage or problems a GP can prevent.’
In November last year, the Australian Healthcare Index report, a survey conducted by the Australian Patients Association and healthcare platform HealthEngine, indicated that patient concerns about out-of-pockets costs are growing significantly too.

A third (33%) of more than 11,000 respondents said out-of-pocket costs are among the three biggest challenges facing healthcare.
Bulk-billing rates were also recently shown to have reached their lowest point for more than 10 years.
The overall bulk-billing rates for non-referred GP visits fell from 83.4% in the first quarter of this financial year to 80.5% from October to December.
The rate is expected to fall further.
Federal Health and Aged Care Minister Mark Butler has frequently referred to concerns about the current average gap fee exceeding MBS patient rebates but has so far not committed to any substantial increases.
In the recently published MJA article, Professor Callander warns that rising out-of-pocket costs could mean Australia runs the risk of replicating health access disparities elsewhere.
‘The increasing out‐of‐pocket expenditure by patients is concerning in light of international experience in the United States, where there is a reliance on private or market‐based healthcare, and healthcare costs are the leading cause of bankruptcy,’ she wrote.
Recent research carried out by the AMA suggests that as much as $4 billion worth of funding has been lost due to freezes on Medicare rebates imposed over the past decade.
It has increased the impetus to bill more patients privately, with the RACGP urging GPs to follow that model where possible to keep their practice sustainable.
‘The result of the $4 billion cut to funding is a situation where Australia’s most vulnerable patients have trouble accessing general practice,’ AMA President Steve Robson told The Australian.
‘Conscription is not the answer and will only exacerbate the challenges faced by general practice. We need carrots, not sticks to improve access to general practice.’
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Dr Paul Vernon Jenkinson   28/04/2023 7:39:30 PM

Why should doctors subsidise the needy all the time?
Perhaps doctor should look after them better by raising their fees and a
leaving it for ltheGovt to provide any subsidy they think fit to those who they decide are needful.