Bulk-billing: is it still viable?

Many GPs feel bound to the Medicare treadmill, but there is another way.

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Let’s talk about money. 

Some years back I visited my old school for an open day, and laid out on the tables in the library were year 12 projects on how to run a general practice. There were all the finances from multiple clinics around town, all available to peruse.

I don’t recall any lectures in med school on the business of running a practice and I sometimes wonder if those final year economics students knew more about the subject than us doctors?

Governments love bulk-billing. It gets them re-elected. Many doctors love it too – no bad debts to chase, guaranteed payment and almost unlimited demand as the product is free. On top of that, many GPs still feel a social or moral obligation to bulk-bill. This is why rebates can stay frozen and yet bulk-billing rates keep rising. 

For many doctors, the only solution is to stay on the treadmill, see more patients per hour, move some things over to the practice nurse, do more care plans etc, but there is an upper limit to how much you can bulk-bill Medicare per year before you get tapped on the shoulder for overservicing, or burn out from simply working too hard. 

The good news – there is another way!

Anecdotally, right now, there seems to be a doctor shortage. I saw multiple patients today who said they had called six, seven, eight clinics and everyone was booked up. Some ask why this is so, and my theory is that a few years ago we were importing lots of doctors, but with covid, hardly anyone can get into the country. 

This means that there may never be a better time to shift to mixed or fully private billing. The demand is there. I know some may be sceptical about this, but my experience is that patients will pay $30 to have their sick child seen, to get a BP check, a repeat script, a Centrelink form, a care plan, a mental health plan and multiple other things. 

The key is the sales pitch at the front desk. The cost of the consult might be $30 but patients have to pay the full amount and get the refund paid back. With a Tyro machine, it is possible to do this whole process in under five seconds – tap card, remove card, a couple of keypresses, tap card again. Thanks to covid, almost everyone has a credit card now. 

Before bulk-billing was devalued with endless low indexation and then the freeze, it was quite possible to earn a decent income seeing four patients per hour. As things got worse, you needed to see five, then six, then seven and once you go beyond this, our friend BERT, the Health Department’s Behavioural Economics and Research Team, might be calling.

Income is roughly the same seeing seven-bulk billed patients or four privately billed patients per hour. Stress is much less with the latter. 

For those doctors who may feel it would be daunting to call a practice meeting and suggest that the clinic move over to private billing, another solution is to work in two clinics. Keep the bulk-billing clinic job, but work a few sessions at a private billing clinic. Increase shifts over time. 

Another option which might seem a bit radical is to start a clinic from scratch. I once worked with an older doctor who did just this, and told me she did a lot of knitting in the first week and then finally, one patient knocked on the door!

When I started my own clinic a few years back we did the whole process in two weeks, including signing a lease in a shopping centre, fitout, purchase of equipment, flight interstate to see the accountant and set up the business, computer installation, signs and mass marketing. We were half booked in the first week, setup costs were paid for in the first month and with growth, we are now overbooked. Not long after, a couple of doctors started a new private billing clinic just 50m away and they have done well and are also overbooked. During that same time, two bulk-billing clinics in the area closed down. 

I’m not sure I can see a future for bulk-billing. For decades, GP organisations have called for a substantial increase in rebates but it has never happened. Indeed, with the recent covid item numbers, it appears the trend is to pay even less per hour. 

I’d encourage anyone who feels they are undervalued to take a look at private billing.