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7 Comments

  1. 1
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    john2066

    Agree. Its absolutely outrageous that pharmacists can block any competitors within 1.5km of current pharmacies. Everyone else competes, except for this ‘guild’.

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  2. 2
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    Professor Tournesol

    ‘Fee for service’ isn’t the problem, it’s the way that the fees are structured. Whilst it continues to pay more to see more patients in an hour and there’s a financial dis-incentive to provide longer consultations, don’t be surprised if most doctors choose the more lucrative route. As a psychiatrist, I’m already choosing to forgo a possible 20% increase in my hourly income as I choose to see 1 patient an hour instead of quick 15 minute reviews. Fix this problem first and then let’;s see what happens, of course it won’t happen as the headlines focus on quantity rather than quality.
    Co-payments are so high because rebates haven’t kept pace with CPI whereas rent and staff wages have. Again, easy to fix but it costs money.

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  3. 3
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    Delia

    Great article. Ironically, just as America’s private health system is moving forward (under Obama) to open disclosure about cost and quality, Australia’s public health system is retreating (under Gillard/Rudd and Abbot to be) into secrecy, price fixing and uncompetitive practices. The USA has just published a list of the costs of the most common hospital procedures being charged by all it’s hospitals. The results show mark ups of 400% or more, with absolutely no increase in quality what so ever. The Obama administration is starting up a website this year, for Americans to report ‘hospital errors’. Hospital funding is now being linked to increased use of computers, decreased errors and lower costs. In Australia, the different costs of common hospital procedures are kept secret. So are reports into sub standard and overpriced private hospitals that even private health funds are questioning supporting. The day Australians can access up front information on actual cost and quality of healthcare, is the day Australia’s hospitals will improve. And neither political party has that on their agenda. http://www.wikihospitals.com.au

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  4. 4
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    Gavin Moodie

    I believe fee for service is a big problem by converting government subsidies into opportunities for practitioners to profit. It is far better for government funding to be directed to clinics staffed by salaried practitioners.

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    Professor Tournesol

    Gavin, whether practitioners work under a salaried or fee-for-service model they profit from the illness of others. Is profit the problem for you, or excessive profit? If the rebate had kept pace with CPI for instance then doctors who had increased fees in line with CPI would be charging the rebate and only leaving those with excessive increases charging out of pocket fees for patients. This is what creates the financial incentive to keep a brake on costs. as it is now the choice for doctors is between no out of pocket costs but short appointments, or out of pocket costs with longer appointments.
    The reality is that the rebate fee has lagged behind CPI and practise management costs every year since the introduction of Medicare and this is why we have a large gap.

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  6. 6
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    Gavin Moodie

    By profit I mean the difference between the purchase price and the costs of bringing the service to market. Fee for service encourages practitioners to maximise their profits. Salaried service would encourage practitioners to provide the service for which they were employed.

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  7. 7
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    Professor Tournesol

    In my own experience it allows me to cost shift from those who cannot afford a gap to those who can, it allows me to see many people who couldn’t afford it otherwise. If the cost of bringing the service to market equalled the purchase price I would go out of business just like everyone else. Even if I were salaried, my salary would be an additional cost over the cost of bringing the service to market, it’s just borne by the salary payer. It also encourages underwork, it also means that what I do and can’t do is dictated by my terms of employment, not by clinical demand. I work as a perinatel psychiatrist providing a service that is just not provided in the public sector as apparently this problem is not ‘serious mental illness.
    What we really need is the right mix of salaried and FFS, as each has their strengths and limitations. FFS gap payments result from inadequate Medicare rebate fees.

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