Australia’s peak medical group has warned GPs will be forced to slug patients in the hip pocket unless the government addresses Medicare rebates which have become a “joke”.
The Australian Medical Association (AMA) said levels of indexation of Medicare have not kept pace with other measures of inflation.
It said the disparity was forcing doctors and medical practices to pass on costs to everyday Australians through higher out-of-pocket expenses, as well as reducing bulk-billing.
The AMA has previously said that from 1995 to 2022, medical services listed on the Medical Benefits Schedule have had an annual indexation rate of 1.1 per cent.
Whereas other measures of the cost of running a medical practice — the CPI and Average Weekly Earnings — grew at 2.4 and 3.5 per cent respectively.
In the December 2022 quarter, the inflation rate reached 7.8 per cent — the highest in more than 30 years.
The AMA argued years of inadequate indexation has meant that medical practices have been forced to absorb the costs of seeing patients, or pass it on.
“Comparing Medicare indexation of 1.6 per cent with the indexation figure of 3.7 per cent for public hospital services … shows just how poorly Medicare is indexed, contributing to declining bulk billing rates and higher out-of-pocket costs for patients,” the AMA said in a statement on Sunday.
AMA President Professor Steve Robson said the indexation of Medicare was “broken”.
“The formula for indexing Medicare has become a joke,” Professor Robson said.
“It is delivering an indexation rate that falls well behind the rate of increase in key economic measures like the Consumer Price Index, Average Weekly Earnings and the Wage Price Index.
“Years of inadequate indexation has meant the Medicare rebate no longer bears any relationship to the actual cost of providing high-quality services to patients, and this is one reason why we’re seeing more practices unable to offer bulk-billing for even the most vulnerable of patients, with wages and increasing practice running costs all funded from the rebate.”
The AMA said that successive governments had stripped healthcare funding and had shifted the costs onto consumers.
“We can see how poor indexation saves the government money but this is really stripping out essential funding in Medicare by stealth, with patients bearing the brunt of higher out-of-pocket costs,” Professor Robson said.
“Doctors can’t keep absorbing these costs and if the government is serious about addressing affordability and access to medical care including general practice, it just can’t ignore indexation.”