Since its 2014-15 Budget the Government has pursued an agenda of fiscal policy – not health policy – to strip $3.5 billion out of Medicare and shift these costs on to patients.
The AMA’s strong and sustained advocacy resulted in a number of concessions by the Government.
While the Government has abandoned almost all of its policies and their iterations, it has remained steadfast on its four year freeze of Medicare rebates.
Medicare indexation freeze
The Government is freezing indexation of Medicare rebates for four years from 1 July 2014 until July 2018.
As with all small businesses, the costs of providing medical care go up each year. Costs to run medical practice include wages for receptionists and nurses, rent, medical equipment, cleaning, electricity, computers and insurance. All these costs must be met by the single fee the doctor charges the patient for their care.
Medicare rebates have been frozen since 1 November 2012 for GP* and specialist consultations and operations and will not be increased until 1 July 2018. *GP consultations were indexed by 2% on 1 July 2014.
Medicare rebates for pathology and diagnostic imaging services have not increased for more than 15 years.
Freezing Medicare rebates for four years is simply winding back the Government’s contribution to patients’ health care costs. The freeze will also have a knock-on effect that could ultimately lead to higher private insurance premiums and higher out-of-pocket costs for patients.
If doctors absorb the freeze, their practices will become unviable.