New rules to restrict the rents GPs can charge pathology collection centres have been slammed as anti-competitive
New rules to restrict the rents GPs can charge pathology collection centres have been slammed as anti-competitive
The governmentâs backflip on pathology bulk billing cuts shows signs of backfiring after a major group of providers repudiated the deal struck on GP rent control.
GPs reacted angrily to the Coalitionâs agreement with Pathology Australia, announced by Prime Minister Malcolm Turnbull in the first week of the election campaign, to chop the rents GPs can charge for pathology collection centres.
âThe proposed changes effectively create an anti-competitive environment, where multinational corporations who make hundreds of millions of profit each year are propped up, while GPs running small businesses lose funding,â RACGP President Dr
Frank Jones said.
The deal neutralised Pathology Australiaâs Donât Kill Bulk Bill campaign against the slashing of pathology bulk billing incentives. Pathology Australia agreed to absorb the cuts and junked a petition signed by 600,000 patients.
For its part, the government pledged to legislate to ensure âfair market valueâ for collection centre rents and delay axing the incentives until that time. Discussions have been held on using independent valuers to determine the premium a landlord can charge.
The deal could save Sonic Healthcare, the giant in Pathology Australiaâs camp, $116 million a year on rents for its 2000 centres, according to a Macquarie Securities estimate.
But practice management consultant David Dahm said he believed the attack on free-market rents would fizzle out, just as an earlier attempt did in 2009.
GPs who relied on rents to keep bulk-billing patients were worried, but others were coming to see the threat as âpolitically endorsed bullying to spook the marketâ, he said.
âCorporates are not being forced to pay big rents. Some are asking for special protection and trying to restrict competition, and they donât have general support from all pathology labs.â
Providers under the wing of Primary Health Care â not Pathology Australia members but with more than 2100 of the total 5400 collection centres â have rejected rent regulation outright, supporting Dr Jones in denouncing the âbackroom dealâ as a blow to general practice.
âWe believe that any reduction in investment in frontline care as envisaged under this is a false economy and will lead to greater healthcare costs in the future,â the groupâs CEOs said in letters addressed to doctors, dated May 19.
The deal is also opposed by diagnostic imaging providers and not-for-profit pathology labs, both set to lose millions in bulk billing incentives and gain nothing.
St Vincentâs Health Australia warned it would have to charge co-payments of $20 to $50 or close its pathology services if the cuts went ahead.
âWe donât have the scale and efficiencies that come with high volumes of largely automated tests,â chief executive Toby Hall said.