13 February 2017
Is Primary’s tilt at private billing going to affect you?
Primary Health care formally launched its much-mooted private billing brand last week, setting the scene for escalating competition in the more-lucrative private and mixed-billing sector.
Practices that are well placed to benefit from the rapidly increasing demand for chronic-care servicing, particularly through programs such as Health Care Homes and Medical Homes, will be the target of Primary’s new company.
But this market has been the traditional stomping ground of IPN and a select group of corporate boutiques.
IPN does have a suite of bulk-billing practices, but it’s portfolio is much better spread than Primary’s, with a lot of well-established, mixed-billing practices in high socio-economic geographies. Amid the Medicare rebate freeze extensions, and with other PBS tightening, all the corporates now realise that to maintain sustainable margins they are going to need a stronger presence in the private-billing sector.
So will Primary’s tilt at a sector which already appears to be well serviced by corporates be good or bad for GPs?
Nominally, Primary’s push into the higher end of the practice market should benefit GPs, particularly GP owners. Health & Co, Primary’s upmarket private-billing brand, is not the Primary we have come to love and hate over the years. It looks like a very different approach to the bulk-billing model which has been at the core of Primary’s business for so many years.
The new brand, Health & Co, had its first formal public outing last week with an unexpected media release, announcing both the new company, and it’s first partnership, with two clinics run by the high-profile Dr Kerryn Phelps. Dr Phelps was also announced as the chair of the group’s advisory board.
The new group won’t be “one size fits all”, which suited Primary’s bulk-billing acquisition and servicing model, which tended to be high volume, low cost.
CEO Maxine Jaquet outlined to The Medical Republic that the new company was approaching the market with a very clear intention to be flexible in their approach to partnering. The range of partnerships the company has in mind spans relatively straightforward servicing contracts for delivering technology, marketing and recruitment, through to co-investing in practices for expansion, and full acquisitions.
Jaquet told TMR that the underlying principle was tailoring services to suit individual-practice needs at whatever stage of development they were at as a business.
“The model is flexible,” she said. “It’s horses for courses. The level of service provision and our initial strategic investment will be specific to each clinic’s needs. This partnership model allows doctors to maintain independence, while accessing services that reduce administrative burden and support growth.
“Our objective is to help practice owners to further build their businesses through smarter services and network and scale advantage. Investments in technology can be tough, costly and timely, but with access to a network of scale, this is a burden that can be eased. We are looking for partners that we can really support and grow.”
Health & Co’s full-service range includes technology support, marketing, recruitment, property procurement and investment.
A key emerging battleground for IPN and Health & Co looks like it will be connected-patient technology.
TMR understands that IPN is currently trialling a patient-side app that talks to its clinics and allows patients to look at their health summaries, talk to any IPN clinic if they are in a different geography, and, most importantly, network between IPN clinics and various partnered allied groups so chronic illnesses can be monitored and managed far more effectively.
In its media release, Health & Co said that part of its service included a “seamless, patient-centric technology platform”.
When pushed for more details, Jaquet told TMR Health & Co “will be showcasing a digital toolkit shortly [which] integrates between patient app, practice management and clinical management platforms”. That sounds very similar to the IPN trial.
If both groups are close to getting such “connected and patient centric” technology working, then things are potentially set to change very quickly in the game of patient acquisition and retention for practices.
The promise of a patient-side app that talks seamlessly between a patient’s mobile and their practice has been on the table for some time, but so far no-one has managed a working implementation of any import.
Both Health & Co and IPN are putting a lot of effort into designing their support systems for emerging “patient-centred care models”, such as Health Care Homes. Both groups are also appealing to doctors with arguments that less time spent worrying about the back office, finances and technology is more time they can spend on their patients.
But not all GPs are convinced. One GP who spoke to TMR said that they doubted that either group had the best intentions for GPs in mind when designing their businesses. They worried that Health & Co might be just looking to technology to improve turnover in margins in the private-billing sector, having mined most of the commercial opportunity at the bulk-billing end.
“Primary is about systems and turnover, not patients,” another GP commented.
Jacquet said that the vision for Health & Co was a “convenient, comprehensive service that is GP-led and patient centric”. She said Health & Co would be looking for investment opportunities but “it will depend on the clinic’s needs, and also the opportunities within each market”.
Initial interest in Health & Co is reportedly very high.
The group soft-launched the website for the business in November last year, but no formal announcements about the existence of the group were publically made until last week.
Regardless, the group had more than 50 enquiries from interested practices prior to its formal launch.