Does Medicare Need Modernising?


Medicare is one of those things that’s distinctly Australian but does it need to adapt to the times? Margaret Faux is a lawyer, registered nurse and founder of Synapse Medical Services.

Her PhD is entitled “Claiming and compliance under the Medicare Benefits Schedule: A critical examination of medical practitioner experiences, perceptions, attitudes and knowledge.” She’s also a regular contributor to the Croakey Health Blog. She joins Tony Arthur on ABC Radio’s ‘Overnights’ program – and they take calls from listeners to discuss the matter.

Listen to the interview in full here.


Or read the full transcript below:

TA:  This Podcast is from the overnights program on ABC local radio.
I am Tony Arthur. 

TA:   As we approach Australia Day you may be thinking about a number of things you consider to be an idiosyncratic reflection of this nation.  An Aussie barbie might spring to mind or maybe Vegemite but what about Medicare?  You like many Australians may take comfort in knowing that if you are sick or injured and short of cash there is a healthcare system you can turn to that supports bulk billing, but is Medicare still true to its original roots and does Medicare need to modernise to keep with the times?  Margaret Faux is joining us now.  She is a lawyer, registered nurse and founder of one of the largest medical administration companies in Australia, and she is also completing a PhD in Medicare Claiming and Compliance and regularly contributes to the Croakey health blog.  Good Morning to you Margaret Faux!

MF:  Good Morning Tony Arthur!  How are you?

TA:  Look I never cease to be amazed at the things that people will do PhDs on.  How on earth did you decide on this topic?  (Laughter)

MF:  (Laughter) Well very good question.  Look I started working as a nurse assistant in a nursing home in South Australia when I was 16 after dropping out of school.  I became a registered nurse, moved to Sydney, worked as an RN for years, then I had a sneaky little career as a singer in there for a bit, and then went off and studied Law, and while I was practising as a lawyer, all the time I was doing the medical accounts for this doctor who had no interest or skill in getting paid for his work, so I married him and then before I knew it all his colleagues were asking me to do their billing as well, and out of that, you know, my company was formed, but the longer I worked with Medicare the more I realised that I was working with a masterpiece, so I found the foundations of this exceptional platform worthy of academic attention and so I turned it into a PhD, and Tony that means that one day you know I will be a doctor of doctor’s billing, which is actually extremely sad in many ways (Laughter).

TA:  And you will be able to show off to the man you married (Laughter)?

MF:  (Laughter) That is right we have one proper doctor in the house.

TA:  (Laughter) That is right.  Now before I talk about this masterpiece as you call it, let’s go back into the history of Medicare, which in fact hasn’t always been called Medicare.  Tell us about that?

MF:  Okay.  Okay.  So this is just going to take a minute or two.  I hope that is okay?

TA:  We have the time at this time of the morning!

MF:  (Laughter) Good, good, good.  Okay.  So this is a history lesson. This is some fantastic Australian history.  So you are right, the original name of the scheme was “Medibank”, but even before that we just need to jump back actually to 1946, to the 1946 referendum for a moment because that is where we actually find the foundations of Australia’s healthcare system.  So what happened at that time was one of the catalysts for the referendum was a High Court Case, which is often referred to as the first Pharmaceutical Benefits Act Case.  There were two of these cases, but this is the first one.  So the Government had enacted the Pharmaceutical Benefits Act to provide subsidised medicines to Australians, but when the case came before the High Court, the court found that the Federal Government did not have constitutional authority to enact laws in relation to pharmaceutical benefits and so the Act was removed.  It was repealed, but what that meant was that other social services also came under the threat of being withdrawn for this same lack of constitutional authority and that included things like widows’ pensions and other post-war benefits, which the people of Australia really wanted, and which by and large had by bipartisan support.  So Ben Chifley was our Prime Minister at the time, Labour Government.  He took us to one of the most successful referendums in Australian history where a new clause was added to the Australian Constitution, and that clause is Section 51 23A.  So what it does is it allows the Government to make laws for Pharmaceutical benefits, so Pharmaceutical Benefits Act was re-enacted, but it also allows the Government to make laws in relation to a whole range of other social services including medical and dental services.  So Medicare is a law made under this head of power.  So it is very important to note that there is this qualifier that sits in the clause.  It is often called the Civil Conscription Caveat.  So what it basically says is that the Federal Government cannot conscript doctors and dentists.  So what does that mean?  You know, to conscript doctors and dentists.  So the High Court has looked at this clause on many occasions and they have basically upheld it to mean two clear things.  The first is that the relationship between a patient and a doctor is a contract.  So it is governed by the general law of contracts just like any other contract like if you have a contract with your accountant, a tradesperson, shopkeeper, it is exactly the same when you go to the doctor, and the second thing it provides is that the Federal Government cannot enact laws that create a legal or practical compulsion on doctors, and that basically means that the Federal Government cannot control doctor’s fees.  They can charge whatever they like.  So and it is somewhat ironic I think Tony, that it was actually the then leader of the opposition Robert Menzies who actually wanted this clause inserted, so before you say… and some of your listeners probably think “Oh My God how did that get there!” and “Definitely need to do something about that clause!” but what it provides is actually also of great benefit to all Australian citizens because it gives us absolute freedom to choose our doctors and that is not found in all other countries, and in fact Michael Kirby in his last High Court judgement described it as a rare constitutional guarantee because it equally benefits both doctors and patients.  So in Australia if you don’t like your doctor you are free to choose another doctor.

TA:  Hmm hmm.

MF:  Because you can enter private contracts with the doctors of your choice.  So we are very, very lucky in this regard.  So then what happened… just quickly, what happens then is we jump to the late 1960s.  So you have got Gough Whitlam.  So Gough Whitlam was not very enamoured with the High Court’s decisions on Section 51 23A and in fact he once described one of those decisions as “the fantastical interpretation” – his words – of the Section 51 23A, but Gough was determined to get Universal Healthcare happening in Australia, because at the time one in 5 Australians had no health insurance at all, and whilst he would have preferred something more closely modelled on the UK’s socialised NHS system, he had a deep understanding of constitutional law and he knew that he was prevented from doing that.  So it was Gough Whitlam, his health minister Bill Hayden and the architects Scotton and Deeble who introduced universal healthcare on 1 July 1975 called Medibank. It was then dismantled bit by bit under Malcolm Fraser after which Bob Hawke reintroduced Gough Whitlam’s original scheme with really little more than a name change, so on 1 February 1984 we saw the birth of Medicare.  So there you go – a history of Medicare in a nutshell.

TA:  Do you think most Australians though give all the credit for Medicare or Medibank as it was called when introduced in the 70s by Gough Whitlam?  They give that credit to him when, from what you have just told us, there was clearly a lot going on before Gough?

MF:  There was a lot going on before Gough, but what we had prior to Gough we had voluntary private health insurance, so there were a lot of insurance providers at the time.  It was a very complex system and in fact it was the Nimmo report in 1969 that was a catalyst for the introduction by Gough of Medibank because that report indicated that health funding had become incredibly complex, was understood by very few, and as Gough indicated one in 5 Australians had no health insurance at all.

TA:  Can I get you to reiterate the point about one of the key features of Medicare, bulk billing, which you have described as a masterpiece.  Why so?

MF:  Okay.  Look bulk billing just never ceases to amaze me.  It is just so very, very clever.  So now that you know the constitutional context, the backdrop.  So the constitution says that the federal government cannot control doctor’s fees.  That is basically what it says but Gough Whitlam wants all Australians to have equal access to healthcare irrespective of their ability to pay.  So how is he going to do that, so he worked out that he can use another section of the constitution which is Section 96 to sort out public hospital funding and we can talk about that later, but how on earth, how is he going to control doctor’s fees outside of hospital in the face of this provision like when you go to the GP?  So they came up with a non-compulsory alternative where doctors could basically sort of…  it is like opting out of their constitutional rights to charge whatever they want and in return they get certainty of payment albeit for a lesser amount and that is what we know as bulk billing, and it was always going to be a winner Tony because I mean you are never going to get a situation where the patient is going to say, “Oh you know…oh look no thanks doc I don’t want you to bulk bill me today.  I would actually prefer that you charge me a lot of money please.”

TA:  Hmm.  (Laughing).

MF:  Right.  It is you know… genius you know but of course as you can see it does hinge on the government rebate being a sufficient reimbursement for the doctor.

TA:  Yeah.  Last year of course there was a very strong negative response to the proposal for a Medicare co-payment but is there a valid argument for a co-payment in 2016?

MF:  Look my view is no, definitely and absolutely, categorically not.  So the evidence clearly indicates that co-payments will drive costs up and lead us to the two tiered system and your listeners need only read back over all the 2014 discourse to refresh their memories on this but look, you know the easiest way to explain it is to give you two actual examples in Australia where we have introduced co-payments and it did not go well.  So the first one was Malcom Fraser, so there was misinformation during the co-payment debate, people were saying that Bob Hawke was the first to introduce co-payments.  That is incorrect.  The first Prime Minister in Australia to introduce co-payments was Malcolm Fraser.  He did that between 1976 and 1981.  So during his time in government we had Medibank marks II, III and IV before he finally abandoned the scheme altogether and at one point during that period the patient co-payment when you went to the GP had gone up to $20. So what happened was this, suddenly people started thinking that they were paying for health everywhere, so they had private health insurance but they still had to pay when they went to the GP, plus they were paying again from their taxes, so the next thing that happened was people started dropping their private health insurance and as you would expect the first people to drop it were young, fit, healthy, low risk people, who knew that they would probably be treated for free in a public hospital anyway if they were sick or injured.  That left the insurers with an older, sicker, higher risk population which costs much more to insure.  So some private health insurers folded completely and others were on the verge of collapse and the level of private health insurance dropped to its lowest point in I think from memory it was the preceding 60 years.  I think that is correct.  So that is the first example of those sort of downstream effects, you know the ripple effects of introducing co-payments, but the second one we are having right now so the second example is we have these two schemes, which I think are hilariously called “simplified billing schemes” and I think they are funny because they are astonishingly complex and this is the greatest misnomer in the whole healthcare system and they were introduced in 2000 and were specifically designed to control patient out of pocket fees when they go to hospital and they have done the exact opposite and that is again because in some circumstances under these schemes there is this legal co-payment that is allowed and it is the only legal co-payment we actually have in Australia at the moment and some of your listeners I am sure will have had the experience of going to hospital and being hit with all of these unexpected bills from doctors when they thought they would not have to pay at all and that is because that is what their private health insurer had probably led them to believe, and that is because it is very difficult to find a way to create sufficient patient safeguards once you introduce co-payments and they just continue to rise and they are almost impossible to control or to cap in anyway or to police and that is because they become invisible.  So the co-payment becomes this sort of “off books” transaction if you like.  So the answer to the question is no.  Co-payment is not the solution to current challenges in Medicare.

TA:  And I think it is pretty fair to say Margaret everybody has heard one of those stories about someone they know if not themselves who found themselves getting medical attention, surgery, other services and thinking that it was all covered by Medicare or by the private health insurance and getting quite a shock in a few weeks after that medical attention with a gap in the money they had to pay but there has been criticism recently from people who say Medicare encourages the oversupply of unnecessary services by doctors.  Your thoughts on that?

MF:  Okay well look that is the fee-for-service argument, so look there is some truth in it but again like much of the discourse on health funding it is only part of the picture and I think it is really important for Australians to have the whole picture.  So there is only four ways at the moment.  Really there is only four ways that doctors are paid in the developed world and all of those methods of payment have well known and well documented advantages and disadvantages.  So there is no perfect way of paying doctors.
So if you look that the four models are fee-for-service, capitation, salary and performance based funding and there is this sort of new buzzword which is fifth which I can tell you about too, so if you look at fee-for-service, the disadvantage is exactly what you have described Tony.  So it sort of incentivises doctors to increase service provision beyond what is necessary and that means costs go up but the advantage of fee-for-service is that it provides a direct incentive to increase effort and it is useful where there is the under provision of services, so if you think about the sort of non-sexy areas of medicine, if you think about like working for people with a disability or something you know like rehabilitation physicians work in that area.  If you are not reimbursing that it might not be an attractive speciality for doctors to go into, so you actually encourage doctors to work in areas where you need services to be provided.  So then if you look at capitation.  So capitation basically works like this.  Here is a bucket of money, here is your population, keep them healthy.  That is basically how it goes.  Now the advantages are really clear.  It gives you a really good control of costs.  There is no incentive to oversupply, strong incentive to improve efficiency and care delivery but it too has disadvantages.  So the disadvantages are there is an incentive to undersupply and the increased pressures may cause providers to sacrifice quality and you get this behaviour that is commonly referred to as cream skimming and what cream skimming basically is, is, you enrol less sick people into your practice because they are going to cost you less to treat.  So the next model is salary, so you just pay someone a salary.  So again you get a really good control of costs and there is no incentive to oversupply and no incentive to compete for patients, but the disadvantage is there is also no incentive to improve efficiency because you get the same amount of money whether you see two patients or 22 patients.

TA:  Ahh I get it.

MF:  Yeah so that can incentivise you to reduce services and quality.  Then you have got this one called performance based funding and that increases the provision of targeted services and the quality of care but you get this behaviour called “gaming” and that is where you cheat by over reporting the activity that you have provided.  So I will give you an example because that is quite a hard one, but we use that sort of in the hospital system in Australia and that is what is called “activity based funding” so what you might see there is that lets say a patient comes in with a sore toe but the patient is only there because they have got a sore toe but that patient has diabetes and kidney disease but both of those conditions are actually stable so what happens with gaming is the clinicians will say “Oh no, because they hurt their toe, their blood pressure went up and then their diabetes went out of control and then we had to do all these other activities to treat the patient.” so that is the disadvantage of performance based funding and then you have got this fifth one at the moment which is the latest buzz phrase really which is called outcome based funding so you might have heard that you know on various programs discussing this issue.  So what that is basically saying is what we are going to do is, we are going to reward wellness instead of sickness and no one would argue that that clearly has some merit but you know I have concerns even on that one because I think look I am yet to hear anyone explain to me convincingly how we are going to measure successful outcomes.  So think of specialities like palliative care, so in palliative care unfortunately the outcome is going to be that the patient is going to die.  In oncology you also will unfortunately have some patient who will die, so how do you measure successful outcomes, then rehabilitation medicine you have got doctors dealing with chronic disability, how do you measure outcomes there and then you just think about GPs or anyone working with socially disadvantaged groups.  We have got people with sort of chaotic lives that make it difficult for them to just you know…they can’t just snap out of it…you know give up smoking, lose weight, stop drinking you know.  It is hard for them and so doctors working with those groups of people are going to struggle to attain good patient outcomes and so two things will happen. They will either lose out financially because they won’t you know meet their targets. They won’t meet these outcomes that we are supposedly measuring or they will have no option other than start cherry picking when it comes to patients.  They only need to take patients into their practice who are you know fit and healthy so then you get a two tiered system. So they are all the different models of paying doctors in the developed world and as you can see there is no perfect solution and in Australia we have a complex blended system of three out of four.  The only one we don’t really use here is capitation to any great extent and that is because of the constitutional restriction.

TA:  All righty oh.  It is 27 to 5, 27 to 4 in Queensland, 27 to 2 in Western Australia.  This is overnights on ABC local radio.  I am Tony Arthur and we are talking Medicare this morning with our guest Margaret Faux, lawyer, registered nurse and founder of one of the largest medical administration companies in Australia and Margaret is also completing her PhD in Medicare Claiming and Compliance and regularly contributes to the Croakey health blog.  So Margaret let’s…you say there is a lot of misinformation out there on Medicare, let’s bust some of the myths.  Firstly can doctors charge what they want?

MF:  Yes they can Tony.  Yes they can and that is because of the constitutional provision that I have just described.  So people often get confused and say things “like they are not allowed to charge this”, or “they can only charge the fee Medicare sets”, now this is… it’s completely incorrect.  The constitution allows doctors to charge whatever they like but the brilliance of the Medicare scheme is in that they don’t and I often remark and I think to myself why is it that in a country where doctors can charge whatever they want, most of them don’t and it is because of the masterful structure of Medicare. So the other thing is the schedule fee.  Let’s just explain this concept of the Medicare schedule fee.  People say you have got to charge the Medicare schedule fee, they don’t.  The Medicare schedule fee is really nothing more than sort of a suggested market value, so when I am explaining it to doctors I say to them look just think of it like a recommended retail price but that is basically all it is.  You don’t have to charge it.  It is just a fee that the government set and it was introduced back in the late 60s as a result of the AMA list of the most common fees and has been indexed over time, but it certainly hasn’t kept pace with the cost of providing services.  Now I should just qualify what I have just said by saying there are exceptions to what I have just said, so if you are a public patient in a public hospital you cannot be charged any money and it is illegal for you to be charged by a doctor in that setting.

TA:  Our number is 1300-800-222 if you have a question you would like to put to Margaret or a comment to make about Medicare 1300-800-222 or you might like to send a text 0467-922-702, 0467-922-702 if you have a text.  The phone line 1300-800-222.  What about other misinformation that is out there.  What is the truth?

MF:  Okay so look the other area where certainly in my business at Synapse where we see a lot of confusion is that Australian patients think that having top level cover private health insurance as you have just said actually Tony, it means you are never going to have to pay another medical bill when you go to hospital and that is fundamentally wrong and it is something that we deal with every day.  So we deal with angry patients calling because they don’t understand their bills and we have a great deal of empathy for them and we spend a lot of time on the phone explaining all of this to them and often when we get to the bottom of it what they feel is that they have been misled by their health fund and I don’t know whether that is true or not but maybe the truth is that they heard what they wanted to hear which was not what the health fund said – I don’t know, but there is a miscommunication happening there somewhere and I do believe we need to look at the language health funds are using in selling their products to patients.  We also need to teach doctors to properly inform their patients about fees whenever possible and most do now but there is certainly room for improvement there.

TA:  You’re doing a PhD as I said in Medicare Claiming and Compliance.  Can you reveal some of your findings at this stage?

MF:  (Laughing) Well look if I do Tony I would have to kill you.

TA:  No… no… no (Laughing) then I wouldn’t be able to claim it back on Medicare (Laughing).

MF:  (Laughing).

TA:  Then I would have to go to see your husband to get fixed and he would charge me an arm and a leg.

MF:  (Laughing).

TA:  Wouldn’t he (Laughing) so…..

MF:  No… no he wouldn’t, not at all (Laughing).

TA:  But you have….

MF:  But look…

TA:  Go on yeah….

MF:  Yeah so look what I am doing essentially is the full title of my PhD is Claiming and Compliance under the Medicare Benefits Schedule, A Critical Examination of Medical Practitioner Experiences, Perceptions, Attitudes and Knowledge.  So I have got one paper published, three on the go and I think I will be finished in about 18 months if I am still standing at that point in time, and what I am doing is providing the first critical examination of the experiences and perceptions of medical practitioners as they claim MBS reimbursements and I want to identify perceived barriers to compliance and explore possible solutions.  So look it came from…you would have all read stories in the paper about doctors rorting but it pops up every now and then so if some commentators suggests a deliberate misuse of Medicare by doctors is causing tax payers billions annually and every time we see it in the paper it is a really, really hot topic but what I think is really fascinating about it is that there is that something has managed to become a hot topic without any evidence and I find that fascinating because there is actually no empirical evidence to support the view that Medicare leakage is caused by doctor rorting.  So what we know is that about 1 billion dollars a year is claimed incorrectly from Medicare but we don’t know whether there maybe reasons for this beyond rorting because no studies have explored whether alternative explanations might exist.  So what I have done is I have completed the data collection from Phase 1 which is the quantitative mapping study of medical billing training in Australia.  So what I wanted to know is when, where and how do doctors learn about Medicare because the literature review revealed very little, so we have surveyed all the stake holders who have a role in the education of doctors from their first day as medical students right through to the end of their careers, got an 87% response rate which is great and I am just writing up the results now.  So I will be happy to share them with you in a few months’ time Tony once I have published the paper.

TA:  All right well if I am on the program it is a date.

MF:  (Laughing).

TA:  But Mawunyo the overnights producer I am sure will be in touch with you no matter who is presenting the program.

MF:  (Laughing).

TA:  Margaret, we will get back to you, a couple of comments on our text line: Phillip in Kogarah in Sydney says “Excellent discussion.  Does your usual GP do these things knowingly or maybe a subconscious business decision?” he says “Most doctors care more than the dollars.”  Thank you Phillip, and Maura says “I work in the industry, huge over servicing in every sector, after hours doctors earning $600 for sometimes as little as a 5-10 minute service.  The system is going broke mark my words.  Soon a day of reckoning.”  Your thoughts on Maura’s comment?

MF:  (Laughing) well look both are good comments.  Look I guess the question I would raise for Maura is it is impossible to quantify… you cannot quantify over servicing.  So Medicare and in fact over servicing is not a term that is used in the scheme anymore.  When we introduced the Professional Services Review Scheme in 1994 we took that term out.  It is no longer a relevant term.  It appears nowhere in the regulatory framework.  So the new term is Inappropriate Practice and Medicare benefits are payable for clinically relevant and necessary services.  So there is two components.  It has to be clinically relevant and it also has to be necessary and that is quite you know …that is quite a grey area.  That is not really something scientific that doctors can hang their hat on because something could be clinically relevant but not necessary and so they make decisions as they go with every tiny patient interaction.  Every interaction, every claim.  They have to make this decision was this clinically relevant and necessary and we can’t …what we say is over servicing but if you weren’t there in the room with the doctor and the patient I would suggest that really no one is in a position to say whether that was clinically relevant and/or necessary.

TA:  Hmm.

MF:  The other thing I would say is that Maura has a point in that I think one of the other drivers of the increasing cost is that the corporatisation of medical practice really does have a role to play that we need to address, so for example a lot of these afterhours doctors that Maura is talking about they are not just working on their own Tony, so what they are….they will be contracted to afterhours services and those afterhours services will sign them up to a contract and in that contract will be targets, so it will say something to them like your targets are this many consultations per night, or per week or per whatever and so you have got doctors in a position where they have got to make decisions about something being clinically relevant and necessary and at the same time meet their targets that this corporate entity is imposing on them, so that is one of the areas that I am looking at in my PhD.  I am really interested in understanding third party pressure.  I want to understand do doctors feel that they are under pressure.  If they are from whom and what is the nature of that pressure.  So I think we need to be cautious about just saying that all doctors are over servicing.  We don’t have evidence.  The reality is there is no evidence of that and I think it is a little more complex than that.

TA:  Okie dokie.  Now we have got a few callers on line so let’s see in the 17 minutes between now and the next ABC News we can’t answer some of their questions or field some of their comments.  First we will say good morning to you Maureen.

F2:  Oh good morning.

TA:  You have had some difficulty getting a refund from Medicare have you?

F2:  Because I have an allied health referral there for a year and I usually front up and I get my 5 free visits from the provider because I am a pensioner by the way and….

MF:  Hmm hmm.

F2:  And this year the provider has decided that they will charge and I will have to just get the Medicare refund for it, but in my innocence I didn’t realise I had to have my bank details registered with Medicare because my doctor has been bulk billing pensioners for years.  Anyway I went in the other day to give Medicare my bank details.  The cheque was issued, the refund cheque was issued on Monday this week but it is definitely snail mail!

TA:  So the cheque is on its way to you and you are waiting for that cheque to arrive.

F2:  Yeah hopefully but now at least I am registered so… my bank details are registered but…

TA:  So it looks like it will come your way.  It will just take a couple of days because we know this changes….

F2:  Yeah when you are on a pension…

TA:  To the delivery system.

F2:  A pension you usually are on a budget and there was another bill I couldn’t pay and will have to wait till next pension payment…

MF:  Hmmm.

F2:  Unfortunately.

TA:  Well hopefully with the weekend coming by it will be in the letter box on Monday morning.

F2:  Hopefully yeah.

TA:  All right good luck with that.  Thanks for your call.  Let’s go to Bryce now who is with us and you want to put a question to Margaret about tax rebates on private healthcare, Bryce?

M2:  That is right Tony and so far I think your show is brilliant.

TA:  Thank you.

M2:  Yeah what I am concerned about is…and I am retired now but I worked for 45 odd years, but what I was concerned about is paying as a taxpayer we are propping up private health funds since the Howard government brought it in to give a 30% rebate on contributions to private health funds and if you look at the socioeconomic end of it, people who could afford private health funds were the upper wage earners whereas the lower people couldn’t afford private health funds anyway but in their tax they are still paying to subsidise a private health fund.

TA:  All right have you got any thoughts on that Margaret?

MF:  Yeah look I completely agree with your comments there.  You know the other really interesting part of that is that what a lot of Australians don’t understand is that when a claim is made when you go to hospital using your private health insurance, the private health fund actually collects the 75% Medicare rebate so we often have patients say to us oh no my health fund pays for that – that is not Medicare, but that is actually not what happens, so when you go to hospital that payment that your health fund makes has two components: so the first component is 75% of the Medicare schedule fee and then depending on the way the doctor claims the health fund tops it up and one of the things I can tell you is that the health funds hold on to that Medicare rebate and I think that is something that in addition to what you have just described we need to address… so the health funds under the spirit of the scheme should release that payment straightaway because under Medicare once a claim has been both received and accepted the High Court has said in the 1994 case of Peverill that the claim then becomes immediately payable but the health funds are holding on to that money and sometimes they hold on to it for up to a month more and there used to be a provision in the National Health Act that said they had to hand it over within two months but that provision is no longer there, so it is a very complex issue and it may be addressed in the upcoming review of the private health insurance industry.

TA:  All right Bryce thank you for your call.  Hope that addresses your question and we will go on and say good morning to Merle.  Now Merle you are concerned that retirees may be contributing to some of our problems?

F3:  Yes, we all paid our Medicare levy but Mr Howard decided we didn’t have to pay tax and even though the Medicare levy is not a tax, it meant that we did not pay the Medicare levy and therefore the Medicare is losing out on such a lot of money from such a lot of reasonably well off or very well off retirees and us oldies are the ones that get sick.

TA:  And you think it might be having an effect on all the funding for medical services?

F3:  It is all affecting the Medicare.

TA:  Okay, Margaret your response?

MFWell I think that is really honourable… sorry I think what I am hearing is that retirees don’t have to pay the Medicare levy but is that what you are saying though is that some would like to?

F3:  Yes…

MF:  Continue to contribute….

F3:  Why should not we pay?

MF:  Yeah good point!

TA:  You don’t hear that very often! People offering to pay more Merle!

MF:  No… no… fantastic!

TA:  I don’t know if you would get your support from your fellow retirees but thank you for your thoughts on that.  Anthony has concerns about an upcoming cataract operation.  Good morning Anthony.

M3:  Yeah good morning Tony.  Good morning Margaret.

MF:  Good morning Anthony.

M3:  Yeah hi there.  I am a pensioner and I am going to have a cataract operation shortly.  What do I expect out of pocket expense do you think?

MF:  Well have you…What is your…Have you got health insurance? Private health insurance? How are you going to…?

M3:  No no I am just a public patient you know.

MF:  You won’t pay anything in that case.  If you are a public patient and you are going into a public hospital it will be completely free for you….you should not have to pay.

M3:  Well how does that work?

MF:  Everything…

M3:  I really don’t like that word free because someone pays for it somewhere right?

TA:  Yeah but your question Anthony was will you be charged and that is the answer Margaret has given you so..

M3: Yes.

TA:  It is a case there.  Just check that that is the case and you have probably been waiting for a while to get in there too Anthony.  Good luck and hope it all goes well.  Liz you have got a question about doctors rorting Medicare?

F4:  Yes hi Tony, Hi Margaret.

MF:  Hi Lynn.

F4:  How can patients stop doctors from rorting or inappropriately charging Medicare.  The patients are so relieved that they are bulk billed.  They don’t look at the code, number on the Medicare claim copy, the copy usually it is taken by the receptionist but if for example if you are there 5 minutes and they have got the ABCD level or E level the number of minutes you are in the doctor’s clinic.  It should be say 5 minutes or 10 minutes and they charge and the doctors are charging up to the next level that to me is wrong and I have evidence of that so…

TA:  Are you suggesting as patient we perhaps have the… that we should be included in this process and sign off on what the bill before it heads off once we finish the consultation?

F4:  Well that’s right …that’s right.  We should be sighting it.  Patients like I said are so relieved that they are being bulk billed, they say, “Oh no we don’t care” but the doctors themselves… not all doctors… are inappropriately charging Medicare.

TA:  That is a good question you have raised.

F4:  They are upping the level of how long they have actually seen that patient and this is what I am concerned about because there are doctors that plough through people going in out…in out…in out and put the next level up, and that’s overcharging.

TA:  All right.  I think we get the point Liz.  I will see what Margaret has to say about that but thank you for raising it.  It is a very good point just hang on and see what Margaret thinks.

MF:  Liz, a fantastic point.  I couldn’t agree and Tony you have raised good points too so let’s just go through it.  The first thing is, the Medicare rebate belongs to the patient.  So Medicare rebates are only payable under the scheme to the eligible person and the eligible person is the patient, so Liz if you like what that means is the Medicare rebate if you like is your property, for want of a better word.  There is also Tony, a legal requirement that you sign for a bulk billed service.  Now before everyone jumps up and down and says, “I never sign” I believe that Medicare itself has rendered the scheme more vulnerable because what it did in 2011, Medicare started saying to general practitioners you no longer need to keep a copy of the signed bull bill voucher.  So think about it from the medical practice point of view.  The law section 20B of the Health Insurance Act still says and it repeats the word signature 5 times no less.  You have to sign because you are giving away your rebate, you are assigning it to the doctor and you do that by way of your signature that is the evidence.  But in 2011, Medicare started saying to doctors look yeah they have still got to sign it but you do not have to keep it anymore, because if we want proof that that service was provided, what we are going to do is they are going to come and look at your clinical records and then they have this new power, which enabled them to do that.  But what has happened is this, you think about it from the GPs point of view for a moment, the patient sees the doctor, comes out to the desk, decides the bulk bill, the girls print something and gives it to you Liz to sign and let’s say you sign it and there is actually a requirement in the act that they have to give you a copy, and that is actually a law and it is an offence, not to give you a copy but what if the patient says no thanks, I do not want a copy.  Not many people want pieces of paper anymore and I often say to doctors what are you going to do? Run after the patient and force it into their handbag you know? The patients do not want a copy, so you printed all that paper you have got, the patient will sign it.  You do not have to keep it anymore, so the minute the patient walks out of the door, you are going to shred it and that is actually a really complex issue and that is what doctors are facing at the moment.

TA:  Okie dokie.

MF:  Yeah, and that is…yeah.  But the other thing Liz you can look at your claiming on MyGov, so you can go on to the MyGov website, select Medicare as one of your services and you can check the services that have been claimed on your behalf on the government website.  If you have any concerns about them, you can speak to Medicare.

TA:  Okay it is 5 to 5, 5 to 4 in Queensland, 5 to 2 in Western Australia, which means of course the news is just 5 minutes away.  Couple of quick questions and I will need to get quick answers from you, Margaret if possible, Sue on the text line says my doctor charges 20 dollars per script renewal over the phone, I am an aged pensioner.  Is there a Medicare rebate for this and if not why not?

MF:  There is not.  So Medicare rebates are not payable for telephone services unfortunately but as have you heard, the constitution provides that that doctor is able to charge for that.  The Australian Medical Association does recommend that doctors charge for prescriptions if they are provided over the phone in that way for the time and effort involved in preparing that prescription, but no there is no Medicare rebate for that.

TA:  Okay, and Peter is online with a question that I think a lot of us would like to know the answer to, morning Peter.

M4:  Morning Tony.

TA:  Go ahead and ask Margaret?

M4:  Margaret.

MF:  Hi.

M4:  Why was not dental work included in Medibank from Whitlam’s time?

MF:  Yeah, good question! Very good question, so dental services have sort of there has been some dental schemes that have come in and out of Medicare since it was introduced and there is the Civil Conscription Caveat and the constitution applies equally to doctors and dentists and you can see the cost of dental services, you know we all pay a fair amount when we go to the dentist and we only have private health cover for those.  So the question of why they were not included, look I think the major battle at the time for the Federal Government, Gough Whitlam’s government was to manage medical fees, that was the priority at the time and probably because of the ability to fund the scheme, they wanted to keep less providers rather than more providers on the scheme.   Interestingly optometrists were included on the original scheme as well but dentists were not.  They have come in and out but by and large they are not included on the scheme.  I doubt that they will be now.

TA:  Yeah.  Many people would argue though oral health is important as is the health of any other part of the body but that is perhaps an argument for another day.  We have just a couple of minutes left Margaret, So before we let you go, despite all the anomalies we have talked about, Medicare you seem to think is pretty good and compared to the rest of the world, we do okay, but what are the challenges facing Medicare today?

MF:  Look the challenges facing Medicare are, look it does need to be modernised, it was introduced at a time when there were only two likely outcomes from a visit to hospital that was death or cure. So it was designed for short episodic treatment, not chronic illness, we did not have much of that back then so it not very surprising that it struggles to support chronic disease but we also need to address wholesale ignorance about how Medicare works, in government, amongst people, doctors, bureaucrats.  We really do need to address that but look I would like to just say something that, I like this quote from a former liberal party health minister Michael Wooldridge in 2001, he basically said, when you have a system that actually works pretty well that the public likes, that delivers universal care for 8.5% of GDP, at the moment it is about 9.5%, encourages private sector funding of a substantial choice and has successfully implemented cost containment policies, why would you even want to change and I just think that we need to be very careful that in the process of modernising it, we do not do irreparable damage, I mean, if you think about it, you would be pretty worried if a surgeon took a knife to your belly without knowing the internal workings of each and every organ and system that lies hidden beneath your skin but not knowing the inner workings of Medicare has never prevented our politicians from tampering with what I think is one of the world’s best healthcare systems.

TA:  Okay a good note to leave it on and Margaret particularly thank you because you are in India on a work related trip and you have very generously given us your time to talk about it this morning, so we thank you very much and appreciate your expertise on the topic.  Thank you so much.

MF:  You are very welcomed Tony, it has been a great pleasure.

TA:  Margaret Faux, lawyer, registered nurse and founder of one of the largest medical administration companies in Australia completing a PhD in Medicare claiming and compliance and contributes regularly to the Croakey health blog.  Thank you for all your texts and apologies to those on the phone line that we just simply did not have time to get to.



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