Is VPE capitation in a mask?

11 minute read

GPs familiar with the UK general practice funding model are sounding dire warnings about patient enrolment. Are their fears justified?

Bulk billing as it currently operates is not sustainable – that’s a truth universally acknowledged.

But the funding model that will both remunerate GPs adequately and support quality care has proven elusive.

Voluntary patient enrolment (VPE) has been courted and articulated as the way forward, both by the government and key doctor groups, but individual GPs fear this may simply usher in a UK-style capitation payment model.

So, are VPE and capitation one and the same?

Voluntary patient enrolment is coming

Health Minister Mark Butler made it clear at the AMA conference in late July that voluntary patient enrolment, one of the more controversial aspects of the primary healthcare 10-year plan, would very likely go ahead – maybe even as early as next year.

The government’s Strengthening Medicare Taskforce, charged with divvying up the $750m in funding Labor has committed to implementing its recommendations, will likely have VPE at the top of its list.

“There’s very broad consensus across the sector [that VPE] is probably the first piece of work needing a deep dive from the taskforce,” Mr Butler told conference delegates.

But GPs’ experience with the failed Health Care Homes initiative doesn’t augur well for future forays into registration-based models.

Health Care Homes ran for four years and saw participating practices receive bundled payments for patients with chronic health conditions, provided the patient was willing to enrol with the practice. These practices received the largest payments for the most complex patients.

The economic basis was that non-specific payments would help practices deliver non-MBS fee-for-service funded aspects of care.

But by the trial’s end, more than half of the practices originally signed up had withdrawn, according to the final report on the program, issued last month. The most common reasons for exiting included misunderstanding the expectations of the trial, concerns about the software involved, and the high administrative burden of enrolling a patient.

What the 10-year plan says

VPE is a key component of the government’s 10-year plan for primary care reform.

According to the plan, “voluntary patient registration reinforces continuity of care between accredited general practices and their patients, provides a framework of quality and safety for the continuation of MBS telehealth for general practice and lays the foundations for future general practice funding reform”.

The Morrison government backed up that kind of language with dollars. In last year’s 2021-22 budget, the government announced a $50.7m investment for development of a system that would support both practices and patients, to be dubbed MyGP.

Participation will be voluntary for both patients and practices, and eligible patients who have an existing relationship with a participating general practice will be able to register with the practice and nominate their usual GP. People registered with MyGP will still be able to attend other general practices for face-to-face consultations.

The wording suggests the government has its eye on broadening a nascent VPE program in the future.

“Over time, in line with the actions in this plan, doctors and practices will become eligible for increasing benefits for providing quality care and improving health outcomes for their registered patient population,” the plan states.

But if government, as well as some of the major doctor groups, support the introduction of VPE, many GPs fear it will open the door to a UK-style capitation model.

Outgoing RACGP president Adjunct Professor Karen Price tells The Medical Republic this is based on a misunderstanding of the Australian model.

“Multi-source funding is not capitation, and the college is not in favour of capitation, of having the medical profession coerced or managed by health bureaucrats who really don’t understand each individual consultation,” Professor Price says. “We can’t have unelected people deciding what happens in a consultation room. That would be a destruction of the profession.”

Professor Price is aware that not everyone agrees.

“I see very uninformed people suggesting that VPE’s capitation, but it’s not,” she says. “There are different models of VPE and it’s really about embedding continuity of care and enshrining the general practitioner as the care coordinator because they’re the diagnostician.

“And voluntary patient enrolment is voluntary. It’s continuing with fee for service –  although the actual details of how that will work are not worked out.

“Our position is that we should really enhance the SIPs and the PIPs [service and practice incentive payments]. If we only pay for enrolment, then that’s all we’ll get, so we’re actually in favour of funding the doctors who are doing the work, including the practice owners, and doing that in an equitable way.”

Key doctor groups are on board

VPE formed a significant part of the RACGP’s 2015 version of its Vision for general practice position paper.

The college said its own model was designed to formalise the relationship between patients and their chosen practice, with particular benefits for chronic care and preventative care. Under the model, patients would still receive support via the fee-for-service funding approach administered through the MBS.

The college recommended a standard nominal fee be charged for patient enrolment, which would cover the time needed for its administration. The enrolment fee would be paid directly to the GP, who would also claim an MBS patient rebate for clinically relevant consultations once the patient was enrolled.

The RACGP also proposed a quarterly or annual continuity of care payment for each enrolled patient if they accessed a defined proportion of medical services from their enrolled practice.

This would be an incentive for practices to maintain continuity of care and to develop strong relationships with their patients.

VPE, however, occupied a less prominent place in the paper when it was updated in October 2019. No detailed model was proposed, although there was a note to government that funding should be proportionately directed not just to individual GPs but also to the practice.

The AMA too backed VPE in its 2022-23 pre-budget submission – provided GPs were adequately funded.

The association said it was “time for government to broaden its approach to VPE and offer the opportunity for all Australians to voluntarily enrol with their usual GP or general practice”.

The chance to collect and provide data, which could be facilitated by enrolment, would support outcomes-based funding as well as benefiting the profession, according to the AMA.

“[With VPE] linked to patient data, we can prove stuff,” former vice-president Dr Chris Moy said at the AMA conference in July. “We can prove that we do stuff and that we save money for [the government] … and we can start to go up against the hospitals and actually be able to not only improve care for our patients, but also start getting a change and reinvestment into general practice.”

Concerns have been raised about the quality of the technology in Australia, however, and therefore the profession’s ability to provide that data.

What happened in the UK?

Much of the concern about capitation stems from the experience of GPs in the UK, many of whom have moved to Australia in the wake of the effective collapse of general practice there.

In 2004, a complex formula was introduced that took into account variables such as patient turnover; age and sex; and socio-economic make-up of an area. This was used to determine the size of a capitation payment. Different sub-formulae were used in England/Wales, Scotland and Northern Ireland.

In 2017, about 60 per cent of a GP’s income came from capitation payments for essential services; about 15 per cent was fee for service for optional services, such as vaccines for at-risk populations; and about 10 per cent were performance-related payments.

UK patients register with a practice, and possibly with a GP, and the remuneration focus is on the number of patients registered with the practice rather than on the amount and quality of care provided.

But the system was not adequate to protect GPs’ remuneration.

Partner GPs’ mean nominal income decreased by 1.1%, from £99,437 in 2008 to £98,373 in 2017, according to a study published in the British Journal of General Practice in 2020.

While the average nominal income for salaried GPs went up by 4.4%, from £49,061 in 2008 to £51,208 in 2017, the proportion of salaried GPs in higher-income bands increased over this period, the study found, helping to explain the increase in average nominal income.

According to the study authors, the results confirm GP income fell in real terms between 2008 and 2017 for both partner and salaried GPs.

“The decrease in GP income adjusted for sessions worked and inflation over the last decade may have contributed to the current problems with recruitment and retention,” they concluded.

The dissatisfaction that accompanied the decrease in real income was only compounded by the huge pressures on the UK’s NHS created by the pandemic.

VPE Australian-style, however, is voluntary and this is something both the government and the RACGP have emphasised.

One medical publication saw an opportunity to learn from the UK experience over six years ago.

“What is clear is that policymakers in both countries need to ensure healthcare provision can meet the needs of their ageing populations,” noted an article in the British Journal of General Practice, published in 2016. “The only way to do this is by putting general practice truly at the centre of both healthcare systems.

“Funding ratios should shift from hospitals into the community, roles within the general practice team, particularly nursing, should be strengthened, and general practice quality increased through recruitment of more GPs and retention of the existing workforce.”

Professor Price agrees.

“We can’t have a coercive model, such as we’ve seen with the KPIs in the quality and outcomes framework in the UK, because that destroyed the profession,” she says.

That framework gives an indication of the overall achievement of a practice through a points system. Practices aim to deliver high quality care across a range of areas for which they score points. The final payment is adjusted to take account of surgery workload, local demographics and the prevalence of chronic conditions in the practice’s local area.

“We, however, need to look at quality improvement attached to any funding model,” says Professor Price.

Changing funding models is scary

The AMA’s new vice-president, Sydney GP Dr Danielle McMullen, told this year’s conference why many doctors were wary of VPE.

“I think we’re really scared about being asked to do more and go through more red tape for a meagre return,” she told delegates.“I think we’re all worried that the fundamentals of our business model are at threat, and above all we’re human and we don’t like to change.

Therefore, if a move to VPE-based funding is scary, it should come as no surprise that moving from bulk billing to mixed or private billing is also scary.

Sydney GP Dr Imaan Joshi says this fear may be due to worries about losing patients. But after her own move away from bulk billing, she found many of her patients did come back to her.

“It is normal to be fearful, and to expect a significant percentage [of patients] to move, or threaten to. It is human nature, especially with the cost of everything going up at the moment,” she wrote in TMR in June.

“If we are to survive this, and not go under, we must have a plan. And arguably, those who continue to bulk bill will go under anyway, sooner or later, either via providing unsafe care or through burnout.

“So, my advice to all taking this brave step is to watch your own anxiety, to press pause, and to remember why you are doing it.”

A voice of dissent

Despite individual GPs’ opposition to capitation, only one of the seven candidates vying to be the next RACGP president mentions the issue in their campaign materials.

“The RACGP has always believed if you simply state your well-thought-out ideas that create optimal health outcomes, the government will realise this is good and implement it, but this has never happened,” Dr Chris Irwin, who is vehemently opposed to capitation, tells TMR. “Instead, what happens is government cherry picks cost-cutting ideas and discards everything else.

“Following the disastrous Health Care Homes capitation trials, my concern is the new Labor government will trial capitation again.”

Dr Irwin fears VPE is a Trojan horse that will make it easier for government to cut costs by allowing Medicare rebates to gradually wither away.

“[Capitation payments are] funding that has been stolen from patients by the Medicare freeze and is now being used to slowly destroy general practice,” he posted on Twitter. “The plan is clear once VPE becomes instituted – continue to underfund fee for service rebates, continue to allow them to fall behind inflation, and only let VPE increase at the rate of inflation.

“Then you can kill fee for service over a decade or two while the capitated GPs don’t even see it coming.”

End of content

No more pages to load

Log In Register ×