Three numbers that matter: 62%, 40% and 15c

26 minute read

These figures that have emerged this month tell three very different stories, but they’re all issues that GPs have a stake in.

When it comes to MBS interpretation, impending covid disaster and digital health funding, a few little numbers can say a lot.

Who is to blame for so much Medicare item confusion?

According to a TMR/Healthed survey of just under 1000 GPs on 31 August, more 62% of GPs find MBS descriptors ambiguous or confusing.

Sixty-two per cent?

Is that 62% of GPs that can’t do their job properly and make some simple decisions on whether to charge certain items or not, or is there something else going wrong here?

In the same survey, only 10% of GPs said they were using the dedicated Medicare email interpretation service AskMBS to get clarity.

Hmm … why only 10%? Is the service hopeless, do GPs simply not know about it or are they perhaps apathetic about using it?

We need to ask a few more questions to drill down on the exact problem here (we’re going to do that in coming weeks) but it feels like it’s a mix of poor service and poor awareness of the service.

We got a lot of comments saying they’d never heard of AskMBS.

Only 22% said they had ever used it, which could point to an issue of awareness. Whose fault would that be I wonder?

But what if they had used the service?

Sixty per cent of those that had done so then went on say that didn’t find it practically useful. Sixteen per cent said they had at some time followed advice from the service and later discovered it was incorrect.

That doesn’t engender a tonne of confidence among other GPs, I’ll bet.

It turns out that most GPs rely on their practice manager for advice on item numbers (37%), which may or may not be a good thing; 23% said they use the MBS handbook, and 19% said they relied on peers.

Hundreds of GPs have received compliance letters recently from the Department of Health for billing telehealth items for patients who do not strictly meet the “existing relationship” rule –  which has yet again brought this whole problem into focus.

The confusion here might be explained by the rapid introduction of telehealth items due to covid, and the fact that the department cut longer telephone consult items mid-year while leaving longer video items intact, only to reverse the cuts for areas that are Commonwealth-designated hotspots or under state/territory isolation, quarantine or lockdown orders.

The next most confusing item numbers were any relating to covid (35%), care plans and procedures (both 28%), chronic disease (24%), followed by after-hours (11%) and aged-care/home visits (10)%.

TMR and Healthed are going to dig deeper on the issue in coming weeks to get more clarity on why so many GPs continue to come unstuck on their billing decisions.

At 62% being confused, it hardly looks like the problem is just the GPs.

The original article this opinion is based on was written by our Editor earlier this week. If you’re a bit of an MBS nerd like me and like reading the individual comments of each GP, you can trawl through all 189 of those HERE.

What will ‘Freedom Day’ do to the vulnerable regions?

I don’t usually write about covid – you know what they say about expert opinions on the covid crisis and arseholes.

The last time I touched on the subject was when I read in the Sydney Morning Herald one Saturday morning that someone in a unit overlooking the international passenger terminal  was watching the passengers of the Ruby Princess all pile off into buses, taxis and friend’s cars, and had wondered out loud to a journalist if that seemed like the right thing to be doing for a big cruise ship at that time.

It was early on in the crisis, and I’m no expert on anything, but at the time it just felt insane.

I had that same feeling this morning (it’s Friday, about 11am as I write this) when I heard on the ABC that the Rural Doctors Association was wanting to understand why the NSW government was going to ease lockdown restrictions in large parts of country NSW, based on the adult vaccination rate reaching 70%, when the average in the country regions it was proposing to open up is only 40%.

Presumably some proportion of this low rate is also heavily concentrated in more vulnerable First Nations citizens.

If this 40% stat isn’t worrying anyone, then perhaps the report in by journalist Samantha Maiden, that the NSW modelling for lockdowns being done by the Burnet Institute, which came up with scary prediction that NSW ICUs will peak at at least 1000 ICU cases, came up with that prediction based on the lockdowns being maintained, not eased, even at 70% and 80%.

If you do some back-of-an-envelope maths on what could happen to those ICU cases if we ease lockdown in the country with a 40% adult vaccination rate, well, you probably don’t have to be an expert of any kind to start worrying big time that something really bad could happen here.

Not to sound too broken record, like all those other experts out there, but where the politics starts and the science (and the “we rely on our medical experts only in making our decisions”) ends here is starting to become all too clear – we seem to be abandoning the science for the politics, big time.

I was watching the cricket in England a few days back – India vs England, fourth test – and I was at least two beers into a fascinating battle when I realised I was watching a fully packed KIA Oval in London (capacity nearly 30,000) live. All these people were out mixing it, with not a mask to be seen. A happy-looking bunch too.

I had thought covid was still pretty bad in London (my 21-year-old daughter has lived through the covid crisis there), although I had also read about Freedom Day there and so assumed it all must be getting better rapidly.

Not really.

I checked the covid figures for today in England: 38,000 cases and 167 deaths – all rising now; 921 deaths in the past seven days.

All this, and apparently more than 80% of the adult population is vaccinated.

The UK is bigger than us, sure, with almost three times our population.

The UK is densely populated and serviced by its healthcare services. NSW and much of Australia have relatively large rural and remote large populations very poorly serviced relative to our cities and towns.

And if you’re wanting to point out that we are starting from a much lower base because the UK really stuffed up in the early days, then I’d point you to Israel, the supposed poster child of international vaccination rate success.

In the week to August 30, it had 193 deaths (up 10% from the previous week and rising), and 65,889 cases (up 8% and rising). It’s thinking about lockdowns again as things clearly are back out of control, despite the vaccination rate.

You can see why I’m no expert.

I can’t reconcile in any way the current situations in the UK and Israel, where they have been 80% vaccinated in adults and things are still getting worse, with a situation where you’d open up in country NSW, where the average is only 40%.

I’m not sure that one of the actual experts involved here can either.

When asked by Maiden “if it was ‘common sense” that allowing vaccinated citizens to return to shops, pubs and hairdressers from October 18 might have some impact on daily case numbers and hospitalisations, Professor Margaret Hellard (of the Burnet Institute, which did the NSW government modelling) said this was “self-evident”.

“Changes in restrictions will lead to changes in outcome,’’ she told “Quite clearly, if you have changes in the assumptions in the model, it changes the findings.”

Professor Hellard would not be drawn by Maiden on what the impact of the “freedom plan” might be on the daily cases or hospitalisations.

She said she was doing “other work for the government” but told Maiden she was not at liberty to discuss that work.

All very clear then. Can’t wait for Freedom Day out west.

A tale of two digital health projects: eScripts vs the My Health Record

As a GP, you’ve probably got very little time or focus to care about some of the fundamentals of how your technology gets funded.

Why would you? I have very little interest in how my iPhone came to be. I’m just glad it did, when I think about it (which is never, until now).

But if you want to understand why things end up good or bad in health care, you can usually find out if you follow the money trail.

So how did your patient management system (PMS), probably your most vital technology tool, come to be? Does the money trail tell us anything about the depth of utility and effectiveness of this system, now and into the future?

We are going to do an NPS score (a global standard for measuring customer loyalty) for all the main systems next week in our regular TMR/Healthed Pulse Survey series, so we can let you know more about what most GPs think quantitatively; but anecdotally, most GPs, when asked to think about their PMS, aren’t big fans.

Most don’t know that, in relative terms to most countries around the world, they’ve been spoilt for the amount of innovation and automation that came to them, earlier than any other market, despite Australia being so relatively small that such systems shouldn’t have been a commercial prospect when they did, given the cost of the technology at the time.

Two things came together for Australian GPs to start enjoying the automation and intelligent decision making that their PMS brought them around 1996: the government provided a $3,000 one-off incentive for them to buy a computer and get on one of the emerging systems (Medical Director was the main one back then), and the PMS vendors of the time were agile enough to produce a product that was advanced and innovative, and not go out of business.

Medical Director was the main early emerging commercial PMS, founded and run then by Dr Frank Pyefinch (Dr Pyefinch went on to found and now runs Best Practice). Luckily Dr Pyefinch was ever so slightly obsessed with how unsafe and inefficient manual scriptwriting was. He was passionate, innovative and persistent.

When the government recognised what Dr Pyefinch had done in building the early Medical Director, they decided to help – as most GPs were never going to fork out an additional $3,000 to buy computers and printers in 1996 – with a one-off ePip grant of $3,000 to get them started.

From there, PMS systems took off.

Note that while Dr Pyefinch was as committed and stubborn as he was in pushing his innovative new software product, the whole PMS market might never have happened without some intelligent, well-timed government intervention and help.

Fast forward to today and we have a multitude of sources of money for the major PMS vendors: Medical Director (now owned by Telstra), Best Practice (still owned by Dr Pyefinch, but with Sonic on the share registry) and Zedmed (privately owned still).

Their main source of revenue is from GPs themselves: you pay a subscription of somewhere between $1,000 to $2,000 per licence per year. But the PMS vendors could not survive alone on these subscription revenues. The market is just too small in Australia; maybe 30,000 active GPs and some licences for office staff on top.

Compare that to the market for Xero in Australia – about 1.2 million small businesses and their accountants – and then consider that the software for GP PMS systems is a lot more complicated than Xero.

Over the years, the PMS vendors worked out that access to GPs could be a source of other funding for them. Medical Director originally developed this principle and started charging for certain apps to integrate to their desktop and get access to doctors. These apps are almost always of use to a GP, so charging for access can be a delicate balancing act for the PMS systems. It is understood that Medical Director generally charges 30% of what an app can make by being integrated to their system.

GPs don’t pay for any of this, of course. An app such as HealthShare, which delivers GPs a pretty good referral directory for specialists and a comprehensive library of free patient management handouts, is paid for by third parties who are after the access too – the specialists who want to be more noticeable in the directory, and pharma companies who want their patient handouts delivered via the trusted hand of a GP.

One of the most important transactional money tenants for the PMS systems is the booking engines – mainly HotDoc and HealthEngine – both of which pay a cut to the PMS systems for the luxury of being tenants in their single GP management system.

Transactional money also comes from some other sources, although at a point things start to get a little murky on who is actually paying.

SMS is a big source of transaction money in the GP market and growing rapidly. Sometimes the PMS will take a cut of an SMS transaction that the GP practice will almost always have to pay. SMS transactions such as patient booking reminders are usually incorporated into the subscriptions of booking engine products such as HotDoc, so the cost is not overt to the practice manager. If it were, it might be a little shocking.

Some of your technology funding remains government funding, indirectly. A diligent practice might squirrel away some of your PIP funding to pay for the maintenance and renewal of all the hardware you still need to run your technology – computers, servers, routers and so on – over time.

And the government, usually through the digital health agency, still directly provides grants to the PMS vendors – sometimes when they change something big in policy or in delivery of Medicare or the PBS, and require the PMS vendors to make expensive software changes to meet the new requirements.

But the truth of the current relationship between the PMS vendors, indeed most Australian medical software vendors, and the government is that it is a mostly a grudging one.

Take the changes that the PMS vendors had to make for the new eScript token system to work during the pandemic.

One vendor applied for and got a grant of $50,000 to write in this new functionality, but it cost them $250,000 to actually write it.

Now all the vendors have to start writing a new and complex integration for Medicare payments and the PBS, which the government has mandated (correctly) will operate via cloud from early next year. The cost of these integrations is huge and the government isn’t going to help them much because, until now. the government takes the view that medical software vendors are commercial enterprises, and they should largely live or die by the market. If they don’t want to make the investment to keep up with how the government wants to run things, then the view has been for a while that, well, it’s a commercial market, someone else will jump in.

So, the PMS vendors, and other software vendors servicing the GP market, have to be pretty careful with their money in order to stay above the waterline. It in part explains why you still have a PMS system that isn’t delivering you all the advantages of being cloud based – for the vendors to invest in this properly, and change the way they charge GPs for their systems, is a huge risk. You can take risks like these if you are a global EMR vendor like Cerner or EPIC, or you are a Xero, but the market is just too slim to risk it and mistime your run in Australia.

If you’ve read this far [congratulations! Ed.] and are wondering what happened to eScripts versus the My Health Record, you’re finally here. Hopefully the stupidly long introduction will become a bit more relevant from here.

Late last year I was called by the CEO of the Medical Software Industry Association, Emma Hossack, who was in quite a fluster about 15 cents.

At the time I could not make head nor tail of what she was talking about – some hitherto unknown transaction fee that the government had paid over the years to the eScript exchange vendors, when an eScript was sent, which was then divided in some ratio between the doctor patient management system (PMS) vendor, the pharmacy point of sale (POS) system, and the eScript exchanges (either eRx or MediSecure).

The e-script exchanges (Rx exchanges) are essentially cloud-based centralised data sets of all the scripts written in the country, which can be accessed by any pharmacist at any time to check a script.

I understood at the time that the government was proposing to decrease the overall amount of 15 cents down to 12 cents, but I didn’t quite get why they were doing it or why Hossack really cared.

In the scheme of things, it all seemed pretty menial. The fee seemed small and divided up so much it felt like, although annoying, it wasn’t a big deal in the scheme of things.

But it was.

In fact, it turns out that this 15-cent fee no one has ever heard of, or knows about, might inform much about how the government and your technology vendors can get together to do a much better job of providing cutting-edge technology to GPs and patients alike.

If the government pursued the 15-cent rebate reduction, it would have been a strong indication that digital health was being run more by Treasury than it was by the policy and strategy people in the Department of Health (DoH) – not good.

The 15 cents in question have been paid to the Rx exchange vendors as a rebate for each script processed through their exchange since the core e-Scripts service got up and running nearly 10 years ago.

Back then, doctors weren’t generating tokens for their patients’ mobile phones via their PMS but were generating paper scripts with a bar code.

But the PMS system was still sending that transaction to the centralised Rx exchange, so when that patient turned up at a pharmacist anywhere in the country, the script could be checked off as genuine.

Each time this happened, the government paid the Rx exchange vendor 15 cents. This 15 cents was how the Rx Exchange vendors got paid for developing the Rx Exchange in the first place. And they shared the rebate with the GP PMS vendor and the pharmacy dispensing vendor – hence another transactional piece of money the PMS vendors were getting.

It’s significant because the Rx exchanges, although private cloud-based networks, each with their own idiosyncrasies, have turned out to be the single most effective and useful pieces of modern IT architecture for interoperability in the Australian healthcare system that exists to date.

Forget the My Health Record – no one uses it.

There isn’t really a reason for most stakeholders to use it. It isn’t facilitating useful information exchange at the right place at the right time with the right people.

The Rx exchanges are.

They facilitate the better part of 300 million script transactions each year – connecting the doctor on one side of the transaction to the pharmacist on the other side, to make sure nothing dodgy has gone on in between. Now they also allow a patient to carry their scripts on their mobile phone, and retrieve them anywhere they like.

The system is being used now for real-time monitoring of dangerous scripts, such as those for opioids, to help reduce issues in the system such as doctor shopping.

Three hundred million times 15c equals $45 million.

But that’s not actually the amount the government has been paying these Rx vendors.

For the 15 cents to be paid, the transaction had to be a full end-to-end e-transaction between the PMS and the bar code being entered into the dispensing software at the pharmacist.

Even over 10 years, more than half of these transactions end up getting interrupted before the bar code gets used at the pharmacy end by manual intervention. This usually occurred when the pharmacist manually enters the script into their system, rather than using the bar code, because his or her system didn’t work properly or wasn’t set up for the final leg of the process. When this happened, the government did not pay the 15 cents. This is despite the information still being passed over the Rx exchanges, and effectively doing the check.

That means that the government until early this year was funding the Rx exchanges, the doctor-based PMS vendors and the pharmacy-based software vendors to the tune of only about $20 million a year to do this job, not $45 million.

The Rx exchange vendors would distribute this rebate in selected ratios to the PMS vendors and the pharmacy vendors who helped facilitate the transaction at either end. That means the Rx exchanges were actually doing this magnificent job for a lot less than $20 million per year.

Essentially, between two private sector companies, eRx (which was developed by Fred IT, the major pharmacy software vendor) and MediSecure, and some government support and cheerleading by the Australian Digital Health Agency (God forbid someone praises the ADHA ever, but we are doing it on this occasion), we somehow came up with the most efficient cloud-based system of interoperability – sharing data between doctors, patients and pharmacists seamlessly, electronically – in the country.

Vitally important in the understanding of this project and what it should shout out at the government is that the $18 million has always been performance based. The Rx exchanges get paid only when a transaction takes place – 15 cents a go. If it doesn’t work, the government isn’t spending the money.

Now think about another much better well-known piece of supposed electronic data sharing technology that we all know and love (not): the My Health Record.

So far, the My Health Record has cost taxpayers somewhere north of $2 billion.

And no matter what PR you read from the stats arm of the ADHA, hardly anyone uses it still.

Imagine if we had decided to fund the My Health Record project that way.

The ADHA gets, say, 20 cents each time the MHR is used in a meaningful exchange of data between health professionals and maybe a patient?

If we’d put that system in place at the start, we’d be lucky to spend $1 million per year so far on the My Health Record project.

No matter how many statistics get thrown at us as a result of the opt-in decision on this project, the secret has been out for some time that meaningful data exchanges using this system just aren’t that common. If they were, the government and the ADHA would have probably started measuring them properly, and reporting it, rather than spewing out meaningless stats each month on how many pharmacies or GP surgeries (all GPs artificially incentivised by ePIP) have signed up, and how many useless automated PDF hospital and pathology lab documents or GP healthcare summaries got uploaded last month, most of which will never be accessed or used.

Apparently, about a year ago Treasury worked out that with the new e-token project and the advancement of both the PMS vendors and the pharmacy dispensing systems, the $20 million would eventually start to go up as more and more script transactions became end to end properly, electronically.

Some wunderkind in Treasury did the sums and realised that if this project went really well, the government could end up paying $40 million for this service and project.

OMG, double the cost!

Hence, early last year the Rx exchanges and the vendor community got the word that the government, in its wisdom, had decided to reduce the rebate from 15 cents to 12 cents.

You might imagine that someone in Treasury thought they were being quite generous. After all, even at 12 cents, if things kept going well with this electronics script thing, they’d be paying a lot more than $20 million for it. Maybe even over $30 million.

Of course, what Treasury wasn’t figuring into any of their analysis was the massive efficiency and safety gains at the pharmacy, the doctor and with a patient that more end-to-end electronic script transactions would bring.

Rather than thinking of reducing the rebate, they should have been leaping for joy at what cost savings their meagre extra $10 million-$20 million in funding was going to end up bringing to the entire health system. Among other things, literally thousands of errors that used to occur between the doctor, pharmacist and patient would be eliminated along with the risk and harm that these errors created in the past.

Thankfully, someone, we are going to assume, in the DoH, listened carefully enough to Hossack and her colleagues and recently put a stop to the madness of disincentivising the only truly successful interoperability project the government has been involved with.

A few weeks back, with some short and simple press announcements, which most people would not have comprehended the importance of, it was to be that the 15 cents would remain untouched.

The significance of the DoH coming to this decision probably can’t be overstated.

For one thing, it says that they are listening to the health-tech community and starting to do the math better.

Fifteen cents to 12 cents in the face of the costs of the pandemic could easily have been seen as nothing to fight over internally in Canberra.

Why upset Treasury or your bosses for three cents? Yeah, it doesn’t make a lot of sense (/cents) to cut it under the circumstances, but the whole thing is pretty invisible. Who is really going to care?

That the DoH saw how important three cents were in the scheme of things is big. It says they are starting to get it.

But it’s not as big as another potential implication of this reversal of the cut: that in the 15-cent-rebate funding regime, and how the Rx exchanges were built with the private health-tech community, and government, the government may have stumbled into the most effective way to partner with industry and fund innovation in major digital health infrastructure projects for interoperability into the future.

The My Health Record and a number of other government big bang projects have failed spectacularly in bringing a sensible a return to the taxpayer. Giant IT infrastructure projects tend to fail a lot when run exclusively by government.

If you put the return for the My Health Record project, and the funding mechanism of it up against the Rx exchanges project, the difference on ROI is so startling it’s hard to see why the DoH and even Treasury did not see it a bit sooner.

One reason is probably the position alluded to earlier: the DoH for some time have felt that if private enterprises such as the software vendors can’t make a buck in digital health, then that’s their problem. Why should we be adding to their profitability by helping too much?

The issue has been a big source of tension between the government and the vendor community in Australia for a long time.

It is in part a historical problem. Taking Dr Pyefinch as a leading example, our tech vendors have been very agile and smart in building up their businesses and making them decent businesses without much or any government incentive or assistance.

Hossack pointed out to  The Medical Republic that the real story in “15-cent-gate” is not so much the money that hard-working vendors would have unfairly lost if the government had decided to cut the rebate, but how brilliantly the system of transaction payments worked to stimulate innovation and development in the private health tech sector.

“It would be great if the government could adopt this same funding paradigm more to get some of our  bigger and more complex interoperability and innovation challenges solved,” she said.

It would be great.

Our health tech vendor community are clearly a very capable and innovative bunch, as the Rx exchanges and electronic script writing project now has clearly illustrated.

They know the ground rules, have proved themselves very resourceful and efficient in developing some pretty amazing software solutions on the smell of a few oily rags.

The main issue most of them have in taking part in major transformational projects is capital in a very small, complex and highly regulated market.

They are small and run on tight margins, and don’t have the cash lying around that big globals do, or that sometimes makes an appearance when private VC money becomes available.

What Hossack sees is the potential for the government to partner effectively with the local health-tech community in a manner that benefits both parties and from a government perspective is seriously risk-mitigated by the model of paying based on successful and meaningful data transactions.

The other thing about a model like this is a government can budget its investments in a much more controlled manner.

When the My Health Record wasn’t working five years ago, and the solution the government came up with was to double down on its $1.2 billion investment to that point of time, there was no means ever of controlling the cost against measurable outcomes.

Yes, there would be more money flowing to the local vendor community from government, and making it more profitable over time, but in a model that looks like it makes sense for everyone – GPs and their patients included.

Australia has spent more than $400 million (and more to come) with the global consultancy firm Accenture for the development and maintenance of the My Health Record infrastructure.

If this were a local vendor, a lot would have been different about what needed to be delivered to make the project more useful, because local vendors are part of a networked community and far more at the coal face. Most take pride in delivering solutions that help the health-care system and Australians.

Of course, these things are always far more complex in execution.

The government might need to outlay some initial funding in any project to local vendors that they normally wouldn’t. That’s always fraught with some political difficulty.

But they did that on the Rx exchanges project and look what happened.

Hossack says she is optimistic that the transactional partnering model that seems to have worked so well in the Rx exchange project will now get a bit more attention when government is considering the design and build of parts of our digital health infrastructure, moving forward.

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