Introduction by Croakey: A researcher who has investigated out of pocket medical costs for cancer patients has called for policy reform around public subsidy of the private health insurance industry.
The call follows a population-based study of 452 cancer patients in Queensland, which found that one-quarter paid upfront doctors’ fees of more than $20,000 over the two years of the study.
The findings are likely to be conservative as the study did not include all out of pocket costs faced by patients, including services not listed on the MBS, travel, and parking.
“The consequences can be devastating for individuals experiencing financial hardship, including serious impacts such as delays of or non-adherence to therapy and increased morbidity,” the researchers reported (open access) in the latest Medical Journal of Australia.
Cancer Council Queensland has responded to the findings by telling media that its work shows high out of pocket costs are discouraging many people from seeking medical advice when they notice signs and symptoms of cancer.
In this MJA podcast interview, the new study’s lead author Associate Professor Louisa Gordon, a health economist at QIMR Berghofer Medical Research Institute, said the private health insurance market is failing people and not providing good value, yet continued to be propped up by public subsidy.
“The Government just maybe needs to face the fact that the evidence is that it’s a costly system, and really they should maybe think about shrinking the private health insurance market and putting that money back into the public hospital system,” she said.
Gordon urged patients to ask their doctors and insurers about costs in advance, and called on professional groups to be more responsible and transparent about fees.
Meanwhile, in her latest article for Croakey’s ongoing #OutOfPocket series, Margaret Faux suggests some other solutions to the lack of transparency around out of pocket costs.
Margaret Faux writes:
One of the main problems with out of pocket costs (OOPs) is that consumers don’t know what the OOP will be until it’s too late.
Usually they have just finished their first appointment with the surgeon to whom they were referred, have walked back to the reception desk to settle the bill, and been hit with a quote that sometimes takes their breath away. By then, for most people, it is already too late to change course and it is unrealistic to expect patients in this situation to shop around for a cheaper deal.
We know there are just a few rogue doctors in specific craft groups who charge egregious OOPs, but what we don’t know is how to out them without negatively impacting the entire medical profession, most of whom charge reasonably.
Educating both doctors and consumers about their rights and responsibilities when it comes to medical bills, and shaming those few doctors who charge egregiously are probably the two most effective strategies we have at our disposal to combat this problem, but my colleagues and I have been throwing around a few additional creative ideas, outlined below, that are quick, simple and consumer focussed.
In presenting these ideas, we hope to spark many more creative suggestions for tackling this critical health issue.
Trip Advisor for surgeons
Consumer laws such as the prohibition against price fixing will likely hamper attempts to force doctors to disclose fees and in any event, doing so may actually cause some doctors to increase fees to catch up with their higher charging colleagues..
But what if we developed something more like Trip Advisor?
This website or app would be based on actual OOPs obtained from health fund datasets It would provide the range of fees a surgeon usually charges his/her patients, and will therefore enable patients and their referring doctors to obtain a good idea of the likely OOPs – before they pick up the phone to make the appointment.
This Trip Advisor for surgeons would use the dollar signs we are familiar with on restaurant reviews and could look something like this:
$ Both the doctor and his/her anaesthetist use no gap schemes for their patients 90% or more of the time.
$$ Both the doctor and his/her anaesthetist use known gap schemes with OOPs of up to $500 90% or more of the time.
$$$ Both the doctor and his/her anaesthetist charge gaps greater than $500 90% or more of the time.
$$$$ Both the doctor and his/her anaesthetist charge gaps of $1,000 or more 50% or more of the time or charge booking fees or other uninsured charges.
This model would allow consumers to get a reasonable idea of what OOPs to expect and doesn’t demonise doctors who charge higher fees. Many doctors take on complex patients or are incredibly specialised and may be justified in commanding a higher fee. What is important is that patients understand this before making their first appointment.
Common procedures with high OOPs would be a good place to test this model, such as hernia repairs, endoscopies and colonoscopies, hip and knee replacements, back surgery, cataract surgery, prostatectomies and common obstetrics.
Of course, there is a risk that some surgeons may start up-coding (where a doctor claims a higher paying item number than the procedure performed) to offset the downward pressure on their prices, so we would need to simultaneously introduce a mechanism to catch that as well.
Australia has a long-established system of authority prescriptions for expensive drugs. It’s a simple concept, which introduces a cognitive step into the prescribing process on the part of the doctor who must consider the clinical relevance of the decision to use an expensive drug, and make a phone call, before prescribing it.
The doctor is not prohibited from going ahead with the prescription when there is genuine clinical need. PBS authority staff ask doctors for the clinical indications and record the reply. An authority number is provided and calls to this line cannot be delegated to practice staff.
For physicians and GPs across the country, making these calls is a regular part of their daily grind – which means they are unlikely to complain if their surgical colleagues become burdened with a similar task.
We could use the existing PBS infrastructure to implement authority procedures that would be designed to capture up-coding such as claiming a complex and more expensive caesarean delivery item, when it was uncomplicated.
The process would be the same as for authority prescriptions. All base item numbers could be claimed without authority, but the surgeon would be required to call the authority procedure line to explain the clinical indications before claiming a higher paying item number, and obtain an authority number before proceeding but would be permitted to do so. The phone call would be made after the surgery but before the claim was finalised, noting that whilst treatment of the patient is often urgent, issuing the bill never is. There is therefore no room to suggest any impact on patient care or safety.
Neither the doctor nor the patient would be entitled to a rebate for that item without the authority number on the claim, so there would quickly be a significant impact on the doctor’s practice, from non-payment of health fund claims, and furious patients unable to claim rebates.
There would be a mechanism to feed back to the Trip Advisor site and immediately move any offending doctors to the $$$$ rating – so a one strike and you’re out policy!
Collected data would also be fed back to the relevant specialist colleges each year and reviewed in the context of reissuance of annual membership, and statistical outliers may be questioned or even denied re-registration. The recording of telephone calls would also provide important primary source evidence to enable successful prosecution of offenders.
This would by no means be a perfect system, and it definitely would need further analysis and a trial; however, we were looking for consumer-focussed solutions that could be implemented relatively quickly and inexpensively.
Additional plusses are that these ideas will not negatively impact the majority of doctors who charge reasonably, and both ideas draw on existing infrastructure and available data.
Neither idea is too contentious from a legal point of view, but both would need the support of the majority of doctors to succeed. It’s a start, and we look forward to hearing the views of Croakey readers on these ideas.
Margaret Faux, a lawyer and CEO of one of Australia’s largest medical billing companies, would like to thank Lisa McPherson who was largely responsible for the Trip Advisor concept and Steven Faux who triggered the authority procedure idea.
• See other articles in Croakey’s #OutOfPocket series.