COVID MBS items Explainer and FAQs, No. 42, 13 May 2020


Dear Doctors and Health Care Workers

Some interesting and complex questions in the last few days regarding public patients in private hospitals, which will be of relevance to all specialists and particularly VMOs.

Also a question about ‘Usual’ vs Covid telehealth. Here are the answers:

1.  As part of the state and federal government response to COVID there has been an arrangement in which public overflow patients are moved to private hospitals as admitted patients. Any patient admitted under these COVID arrangements gets termed a ‘public patient’ and is charged only 100% rebate. This figure was apparently considered reasonable by the commonwealth. However, the figure varies from prior arrangements at state level that paid 125% of rebate (a median price per item number is in reality 130%). This was done with an ACCC exemption under extra-ordinary circumstances.

Correct. The relevant resources relating to the ACCC temporary exemption can be found at this link and the key announcement is copied below.

“Australian Medical Association (NSW) authorised to collectively negotiate with private hospitals

The Australian Medical Association (NSW) Limited (AMA (NSW)) has been granted interim authorisation to collectively bargain with private hospitals about the contract terms of Visiting Medical Officers (VMOs) who are working in private hospitals, but are providing public patient services that have been transferred there from public hospitals in response to the COVID-19 pandemic.

VMOs are medical practitioners who work as independent contractors in public hospitals, in addition to working in private practice. However, with public and private hospital operations potentially being integrated under an authorisation granted to the NSW Ministry of Health on 1 May 2020, VMOs may need to treat public patients in private hospitals. The AMA wants to negotiate new contracts to deal with these circumstances.

The collective bargaining is voluntary and temporary, and the AMA (NSW) will not be seeking to increase VMO fees above those currently agreed in the public health system. The conduct is also not intended to interfere with current arrangements for doctors treating private patients in private hospitals.

Having granted interim authorisation for these arrangements, the ACCC will seek feedback on the application for authorisation. Submissions on the substantive application are due by 29 May 2020.

More information, including details on how to make a submission and a copy of the ACCC’s interim authorisation decision, is available on the ACCC’s public register at: AMA(NSW) – VMO collective bargaining in response to COVID-19.”

a)  Is this legal? Or is it like when the government tried to force bulk billing?

In terms of whether the collective bargaining exemption is legal the answer is yes. The ACCC has granted an interim exemption and there is now a consultation process in progress before a final decision will be made in June/July.

b)  As a Private VMO how do they make me comply?

There is not really a compliance issue here insofar as this has nothing to do with Medicare billing. These patients cannot be billed to Medicare.

Please have a read of bulletin 22 where we answered questions relating to public patients in private hospitals during Covid.

Even if you were able to bill to Medicare (which you are not), the maximum you would ever be reimbursed would be 75% of the schedule fee, because Medicare has no legal or technical ability to reimburse inpatient services at any other rate.

My understanding is that the new agreement is simply based on what claims would be paid at if they were billed to Medicare and 100% of the schedule fee was payable. So, the AMA used the Medicare fees as a basis for negotiations, is another way of putting it.

The flow of money here is as follows:

  1. The Federal Government has given $1.3 billion to private hospitals to alleviate numerous Covid related burdens, including accepting public patients.
  2. That money is to be used for all expenses incurred in treating these patients including paying VMOs.
  3. VMOs have existing contracts that do not deal with this scenario, because we do not often move public patients to private hospitals. Covid has thrown up extraordinary circumstances.
  4. As a result, the AMA has bargained collectively on behalf of NSW doctors to enter short term contracts to reimburse VMOs who treat public patients moved to private hospitals, from this pot of money. This was approved by the ACCC.
  5. VMOs will be paid for treating these patients by the hospital NOT by billing to Medicare, and the amount payable will be 100% of the Medicare Schedule Fee for associated items. I am unaware of the precise arrangements beyond this point and whether VMOs are required to submit item numbers and time sheets through Vmoney, though I suspect that would be the case.

c)  I am hearing of patients with private insurance (no COVID) who come to a private hospital under public overflow and are now able to avoid using their private insurance. Is this allowed?

Yes. It is always allowed. Patients ‘own’ their Medicare rebates and private health insurance policies and have absolute autonomy and control over when they choose to assign a Medicare benefit or use their PHI. If patients have elected to be public patients and not use their PHI, the fact that they were moved to a private hospital under Covid arrangements is of no consequence. They do not have to use their PHI and cannot be forced to in any context.

2.  I am a haematologist (VMO fee for service) who mainly works in private practice. I have been given an additional short term (3 month) sessional VMO contract during COVID, to cover an increased scope of practice to care for public inpatients. I have been asked to consult on a public inpatient currently located in a co-located private hospital. The patient is there because that private hospital is currently facilitating the surgical care of such public patients during COVID. Can I legally bill my time caring for this patient according to my VMO sessional contract (VMoney paid for my time)?

See above answer to question 1 and speak with your hospital finance department. It sounds to me like the short-term contract is one issued pursuant to the new Covid arrangements negotiated by the AMA. Whatever you do, do not bill to Medicare!

You can also read more about this in Bulletin 22.

3.  If I am providing a telehealth consultation to a patient who normally lives in a metropolitan area who is self-isolating in a telehealth eligible area, can I bill as a telehealth item (eg 116 +112) or do I need to use the relevant COVID item number. Do I bill according to the patient’s location at the time of the consultation or the address with which their medicare card is linked?

Have a read of bulletin 21 when we answered questions related to circumstances when both usual telehealth and Covid telehealth may apply to the same patient and consult.

You can use either but would usually choose usual telehealth due to higher reimbursement.

You always bill based on the patient’s location at the time of service not where the Medicare card is linked to. But you must not manipulate the distance requirements by jumping in the car (or the patient doing the same) and driving a few kilometres, so you can be the requisite distance apart.

Thanks everyone

Margaret and the Synapse team.

COVID MBS items News Flash No. 43, 25 May 2020…Read more

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