In Labor’s first full-year budget, the Treasurer Jim Chalmers made cost of living measures a key focus. At the centre of this was healthcare reform, part of which the government have said they will be making it easier to see a GP through a new bulk billing incentive.
“As a centrepiece of this Budget, our Labor Government is delivering the largest increase to the bulk billing incentive, ever,” Chalmers told the House of Representatives.
The budget has allocated $3.5 billion to provide free GP consultations to roughly 11.6 million people.
“This will help take pressure off our public hospitals and emergency departments, still feeling the strain of a once‑in‑a‑century pandemic,” the Treasurer said.
“And it will ensure that for millions of people, the quality of your healthcare is guaranteed not by your credit card – but by your Medicare card”.
The move has been welcomed by the Australian Medical Association (AMA), who have said that the changes will make a real difference. The Royal Australian College of General Practitioners (RACGP) have also welcomed the changes, saying it will reverse the decline in bulk billing.
We’re tripling the bulk billing incentive – the largest ever increase in the history of Medicare.
This will help GPs provide free consultations to over 11 million Australians. pic.twitter.com/Af6GIhuNn4
— Mark Butler MP (@Mark_Butler_MP) May 9, 2023
Others, however, have said that the changes leave far too many people out and could contribute to worsening inequality. The Greens have argued this point, saying that everyone should be getting assistance with their healthcare costs.
The National Rural Health Alliance has also welcomed the changes but have said that it won’t do anything to address severe worker shortages faced in rural areas.
So, what are these changes, exactly, how will they work, and will they have the desired impact of actually making it easier to see a doctor? Here’s what you need to know.
What Does Bulk Billing Mean?
Alright, let’s start with some basics.
Bulk billing was introduced along with Medicare in 1984 as a way for the government to cover out-of-pocket medical costs.
GPs get paid on a fee-for-service basis and can either choose to bill the government directly for their services or charge their patient directly. The former is known as bulk billing, owing to the fact that a GP practice will send all of these bills to Medicare in ‘bulk’.
Under Medicare, 100% of GP services, and 85% of specialist services, are covered by Medicare. However, what those practitioners get from Medicare when they bulk bill is the ‘schedule fee’, the price for a service set by Medicare.
In 2023, the schedule fee for a 20-minute GP appointment is $39.75. If that sounds incredibly low, that’s because it is.
Schedule fees are indexed but only by a percentage point or two. That means the fee GPs get paid for seeing you has actually gone down, thanks to inflation.
This is why fewer and fewer doctors are bulk billing. It’s just not financially viable for them to do so.
If you're one of the many Australians who aren't eligible for the #bulkbilling incentive (you don't have a concession care/ health care care etc.) this does absolutely nothing to help with increasing out-of-pocket costs to see your GP. Your rebate hasn't increased at all.
— QLDCountry GP (@QLDCountryGP) May 9, 2023
When GP services, to use just one example, need to charge more, you end up paying the difference, effectively subsidising their work and making up for the government’s reluctance to increase schedule fees.
As such, the average ‘gap fee’, paid out of pocket by patients, has been steadily rising, almost doubling in the past decade.
Because doctors can’t earn enough to keep their services open, not to mention being unable to attract talent based on stagnant wages, large parts of the country are without bulk-billing GPs. Less than half the population currently has all of their GP visits bulk billed. This means fewer people go to see a doctor, and healthcare standards decline across the board.
Budget Bulk Billing Incentive
The headline announcement from the budget is that the government will be tripling the bulk billing incentive. This is an extra payment, that was introduced in 2004, to encourage GPs to bulk bill Medicare for their service. It provides an additional $6.85 to $13.15 on top of the schedule fee, depending on where in the country they are based.
So, rather than getting up to $59.20 for their services, GPs in remote areas may now be able to get up to $79.20 per 20-minute session. For those in the city, it’s the difference between $46.60 and $60.30.
However, these changes will only apply to people under the age 16 or Commonwealth concession card holders. At 11.6 million people, that’s roughly a bit less than half the population. It does leave most working-age people hanging.
Will this boost bulk billing and drive up GP visits? Chalmers certainly thinks so. Others aren’t so sure.
Remember that the bulk billing incentive is roughly $6 in urban areas. That means that it goes up to $18, I think. That's excellent but it doesn't equate to standard private gap fees. There will still be GP access + quality issues for poorer people who need cheap healthcare. pic.twitter.com/NFiuy4Db4R
— Dr Mariam Tokhi (@mariamtokhi) May 9, 2023
Professor Stephen Duckett, from the Department of General Practice at The University of Melbourne, has said that it could “possibly” reverse the decline, but it’s unclear that it will increase bulk billing.
“Practice owners could simply pocket the increased incentive for patients who are already bulk billed, leaving bulk billing rates unchanged,” he has said.
“Or GPs could use the increased revenue from their existing bulk-billed patients to reduce their hours of work, rather than bulk billing more patients”.
There is also the possibility that GPs could prioritise people in the triple-incentive category, making it harder for others to get an appointment.
So, while it may fix a few issues with the GP system, these changes alone are unlikely to reverse decades of underinvestment in the system that are making free healthcare an increasingly uncommon reality.
The tripling of bulk billing incentives will be implemented in November.