Evidence around GP co-payments and over servicing

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Evidence around GP co-payments and over servicing

Posted 19/02/2014 by Amanda Biggs

One argument forwarded in support of the recent proposal to impose a co-payment for GP visits is that it has the potential to reduce ‘over servicing’, and therefore overall health costs. Over servicing occurs where an unnecessary medical intervention is provided. Imposing a consumer co-payment on the cost of visiting a doctor will encourage patients to avoid unnecessary visits, thus reducing over servicing and saving the health system money, argue advocates of co-payments. But what is the evidence that over servicing is a problem or that it is being driven by unnecessary consumer demand?

Before proceeding, a distinction should be made between the extent of over servicing and the incidence of the illegitimate practice of ‘doctor shopping’. ‘Doctor shopping’ typically occurs where a consumer engages with multiple health practitioners in an effort to illegitimately obtain a medical service such as a prescription opioid, often misrepresenting their condition to the doctor. Doctor shopping is most commonly associated with drug addicts, so it is arguable whether a co-payment would deter their behaviour. Because of concerns around doctor shopping for illicit drugs, measures have been implemented in recent years to address the problem, including the Prescription Shopping Program and electronic recording of dispensing of certain prescription drugs.

While mostly associated with drug addicts, there is also some evidence to suggest that doctor shopping can occur among legitimate patients who are simply seeking a cheaper service in areas where bulk billing rates are low.

However, the extent of over servicing being driven by consumers seeking unnecessary treatment remains unclear. One problem in identifying this is that consumers often have limited knowledge as to whether a health condition is serious and warrants medical intervention, or is trivial and will resolve itself. Even not knowing can add to stress levels, so many will opt to do the safe thing, and visit their doctor in any case. Indeed, public health messages promoted by governments often encourage consumers to visit their doctor even where symptoms may appear mild, for example, in relation to urinary tract infection. Consumers are also encouraged to have regular check-ups as a preventative measure; check-ups for those aged 45–49 at risk of chronic disease and those over 75 are specifically funded under Medicare, even where no specific symptoms of illness are present.

Meanwhile, the extent of over servicing driven by doctors is better understood. The Professional Services Review was established to identify instances of inappropriate medical practice, including inappropriate billing of Medicare by doctors. Broadly, the PSR utilises a range of tools to determine if a doctor is engaging in inappropriate practice, including if a doctor varies from a ‘prescribed pattern’ of service. If a doctor exceeds performing 80 or more professional services over a 20 day period in any given year, this is deemed inappropriate practice. The most recent annual report of the PSR shows that in 2012–13, some 45 cases were referred to the PSR for review (up 50% on the previous year). Some 16 cases were dismissed, while repayment orders were issued for 19 cases, totalling benefits worth just over $1 million.

While per capita utilisation of Medicare services continues to increase overall, the picture with general practice is less clear. Over the last decade the highest number of Medicare GP items of service claimed per head of population was in 1998–99, at 5.5 visits per person according to the Australian Institute of Health and Welfare’s 10 year data tables. Attendance then decreased to a low of 4.87 visits per person in 2003–04. This fall prompted concerns over equity of access, leading to the implementation of measures to address this (including incentives for bulk billing certain groups). In 2010, general practice attendance rates grew to 5.3 visits per head of population according to AIHW (although recent data is not available).

This raises questions over the extent to which an over servicing problem exists in general practice. An ageing population, rising levels of chronic disease, new medical technologies and the emergence of targeted medical interventions have all been cited as driving increased service utilisation—as has inappropriate medical practice and doctor shopping.  However, the evidence around over servicing driven by consumers remains thin. In addition, current health messages that are configured to encourage consumers to seek medical advice if they are unsure about a health condition would potentially conflict with the imposition of a patient co-payment.


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