Why spending on GPs is the best value

3 minute read

Australia’s spend on Medicare GP services is incredible value for money, says Frank Jones


Australia’s yearly spend on Medicare general practice patient services is around $330 per person, a remarkably modest amount when you consider that primary healthcare provides a breadth of frontline health services including prevention, acute care, chronic disease management, mental health care, and critically, keeping patients well, thereby reducing the need for expensive hospital treatment [naturally sometimes a necessity].

These services provide incredible value for money in our world-class health system.

Spending on hospital admissions is more than five times at about $1,850 per person. Total Medicare spend is about $1,000 per person every year.

What is even more astounding is that this modest cost of $330 has remained the same, in real terms, for the last ten years. Federal Government has long frozen consumer price index (CPI) increases in the Medicare Benefits Schedule and in the last Budget extended the freeze until 2020.

This means as costs increase due to indexation, the value of patient rebates do not, and GPs are reluctantly being forced to charge increased out of pocket costs – even for children, concession card holders and the elderly.

It seems GPs [and their patients] are effectively being targeted for being efficient! In terms of value for money and health outcomes our Medicare system is a success, lauded the world over with the 2nd highest performing health system in the OECD.

Nearly 90% of Australians see their doctor regularly and GPs perform more than 140 million services every year.

As part of the public awareness campaign in the lead up to the Federal Election, the RACGP called for the lifting of the extended MBS freeze, just to be able to retain the status quo for the continued provision of quality care.

Lifting the freeze for general practice would mean an investment of approximately $160 million per year: national and international experience actually shows this to be an actual saving of health care costs.

The Victorian government for example estimates the cost of the freeze for the state alone will be $230million. In Scotland recent cuts to general practice funding resulted in an increase in emergency department presentation and admissions.

Disinvesting in general practice is illogical both from a patient perspective and from a health cost efficiency viewpoint.

It is important to note that Government has still managed to find money to index private health insurance to the tune of double CPI over the next 4 years – which delivers far less value and does not support health equity.

As the Medicare Levy is indexed so should the MBS rate and the country’s GPs encouraged and supported for the extraordinary work they do every day.

Lifting the freeze is really only going to give us a breathing space. What we need is a long term evidence based plan for a sustainable cost efficient general practice system for Australia.

International experience suggests that sustainable general practice funding should be a blended system of fee for service, patient enrolment [especially for our patients with chronic complex disease states, recognizing continuity and comprehensiveness of care with the context of the patient] and some form of clinical audit to enhance quality patient outcomes.

This conversation is for here and now and is urgent: the RACGP is willing and able to work collaboratively with government to ensure our patients have access to the best health care system that is equitable and fair.

General practice is the gatekeeper of the entire health system and it makes sense for it to be funded adequately and supported.

Dr Frank Jones is President of the Royal Australian College of General Practitioners

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