‘Miserly’ MBS indexation criticised

The 1 July Medicare Benefits Schedule (MBS) indexation has been held up by RACGP President Adjunct Professor Karen Price as another example of why attitudes to general practice funding in Australia need to change.
 
The 1.6% will apply to most general medical services items, all diagnostic imaging services except nuclear medicine imaging, and some pathology items.
 
However, because Medicare indexation is currently calculated using the Wage Cost Index 5 method, it results in lower annual increases than the Consumer Price Index (CPI). By way of comparison, the CPI rose by 5.1% in the 12 months prior to the most recent update in March 2022.
 
The reliance on the Wage Cost Index 5 method means patient rebates for a standard Level B consultation will increase to just $39.75 – a $0.65 increase compared to 2021–22.
 
Professor Price said the 1 July increase does not accurately reflect ‘high quality service provision of general practice care’ and the rising cost of living.
 
‘The miserly 1.6% increase is yet another reminder of why a boost in investment for general practice care is sorely needed,’ she said.
 
‘To put it in perspective – and as we are all keenly aware every time we visit the supermarket or fill up our car – inflation is rising and the forecast for 2022 is for headline inflation of around 6%.
 
‘This really underscores how little difference a 1.6% increase will make.’
 
However, while rising inflation is a relatively recent problem, Professor Price said issues related to general practice funding are longstanding.
 
‘Even before we factor in inflation, the RACGP has warned for many years that the current indexation method is not good enough. It’s contributing to higher out-of-pocket costs for patients nationwide,’ she said.
 
‘If practices are struggling to make ends meet due to Medicare rebates not keeping pace with the cost of providing high-quality care, they have little choice but to pass the cost on to patients.
 
‘This, in turn, can lead to patients delaying or avoiding consultations and potentially even ending up in a hospital bed with a health concern that should have been seen to earlier by a GP.’
 
Professor Price says a ‘better measure of indexation’ would ensure automatic price increases for patient rebates that ‘fully reflect’ the rising costs of living and medical care provision.
 
‘We have a new [Federal] Government and a new opportunity to make sure that Medicare rebates don’t result in patients missing out on the care they need,’ she said.
 
‘A continued failure to set patient rebates accurately coupled with years of zero or inappropriate indexation means the 1 July rebate increase is little comfort to GPs and general practice teams.
 
‘By boosting investment in general practice care, the Government can relieve pressure on the entire health system and significantly improve long-term patient health outcomes.’
 
In addition to changes to indexation, the RACGP is also calling for a 10% increase to Medicare rebates for Level C consultations, which last at least 20 minutes, and Level D consultations, which last at least 40 minutes, as well as introducing a new Medicare item for longer consultations lasting more than 60 minutes.
 
‘This will allow GPs to spend more time with patients and really get to the bottom of what is going on, something that is especially helpful for people with multiple chronic conditions or mental health concerns,’ Professor Price said.
 
‘This week’s Census revealed some eight million people reporting a long-term health condition so the time to act is now.  
 
‘The solutions to improving our health system are right in front of us. We just need the conviction to follow through and deliver on the reforms that will make such a difference for patient care.’
 
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