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Impact of the Medicare Rebate Freeze
The Medicare Benefits Schedule (MBS) lists the services the Australian Government will provide a Medicare rebate for.
Medicare rebates do not cover the full cost of medical services and are typically paid as a percentage of the Medicare schedule fee.
GPs who bulk bill agree to charge the Medicare schedule fee and are directly reimbursed by government.
Those who don't bulk bill are free to set their own prices for services. Patients pay for their treatment and receive a rebate from Medicare.
There is often a gap between what patients pay for services and the amount that Medicare reimburses (about $37 for a typical GP consultation, for example).
This gap is known as an out-of-pocket expense, as the patient is required to make up the difference out of his or her own pocket.
Under an indexing process, the Medicare Benefits Schedule fees are raised according to the Department of Finance's Wage Cost Index, a combination of indices relating to wage levels and the Consumer Price Index.
Organisations such as the Australian Medical Association (AMA) have long argued this process is insufficient, and Medicare schedule fees have not kept up with "real" increases in costs faced by medical practitioners.
The rebate freeze compounds this financial challenge by continuing to keep prices at what the AMA and others argue are "unsustainable levels".
The extended freeze means GPs and other medical specialists will be reimbursed the same amount for delivering health services in 2020 as they were in 2014.
Doctors will pay more for their practices, staff, medical products, utilities and just about anything else that goes into running a medical practice. But the amount paid for medical services will remain static.
At the time the Coalition extended the freeze in 2014, research showed this move would have a greater impact on GP income over the initial four-year freeze than the proposed $5 reduction in the GP rebate would have produced.
In other words, failing to lift the reimbursement amount would ultimately prove more detrimental to GP funding than actually reducing the rebate amount.
Opponents to these changes argue this leaves medical services underfunded and may ultimately mean that additional payments will be passed on to patients.
Former AMA president Brian Owler estimates the extended freeze will lead to each GP visit costing $20 more for patients. Some commentators referred to this as the introduction of the co-payment by the "back door".
Some argued it could reduce the number of bulk-billing practices. Yet levels have risen steadily since 2013 to an all-time high of 84.3 per cent.
The AMA estimates suggest that at present the Medicare rebate ($37) covers only about 50 per cent of the recommended consulting fee. This means that either medical practitioners cover the remainder of the costs themselves or pass this on to patients.
The impact of the extended freeze goes beyond simply reducing the gross income of GPs, or patients having to pay more for their health services.
The information in the above were collected from the internet,
either from government websites or from reasonably reliable health information sources.
They are for general information only and should not replace the need of seeking medical care during illnesses.