GPs will soon get extra incentives to bulk bill. So will your doctor be free?

A key commitment at May’s federal election was an A$8.5 billion promise to increase incentives for GPs to bulk bill patients. The government moved quickly after the election, with new arrangements to start on November 1.

When a patient is bulk billed they don’t have any out-of-pocket payment to see a GP. If a patient isn’t bulk billed, the GP can charge an out-of-pocket fee. The new incentive arrangements gives the GP a small additional payment to help cover the difference.

Bulk-billing incentives are unlikely to lead to 100% of GP visits being bulk billed. But that wasn’t the government’s ambition: it aims to increase the bulk billing to 90% by 2030. The current rate is 79%.

Here’s what’s changing, and what it means for patients and GPs.

Read more: The major parties want 9 in 10 GP visits bulk billed by 2030. Here's why we shouldn't aim for 100%

Bulk billing has fallen, aside from a few blips

The Medicare promise is that financial barriers to health care will be a thing of the past. All you should need is “your Medicare card, not your credit card” was Prime Minister Albanese’s mantra during the election campaign, as he waved his Medicare card around at every opportunity.

It has been a consistent Labor slogan since then-Prime Minister Bob Hawke and Health Minister Neal Blewett introduced Medicare over 40 years ago.

However, the Abbott-Turnbull-Morrison governments froze the Medicare rebate for almost a decade. This meant as inflation rose and the costs of running a clinic increased, GP net revenue went backwards. Many practices gave up on bulk billing and introduced patient co-payments.

Bulk-billing rates were artificially inflated in the first years of the pandemic because new telehealth items were only paid if they were bulk-billed. But when normal billing practices resumed, bulk billing went into freefall.

When Labor was elected in May 2022, the bulk-billing rate was 87% but dropped 10 percentage points within a year.

Labor implemented what it hoped was a quick fix, building on a bulk-billing incentive introduced by the Coalition. Labor tripled the incentive for visits by concession-card holders and children who were bulk-billed.

That stopped the decline. But it didn’t bring bulk-billing rates up to pre-pandemic levels.

How much are the rebates?

Starting on November 1, the bulk-billing incentive will apply to all Australians.

In addition, if a practice bulk bills all its patient visits, it will receive a further 12.5%.

The rebate for a typical (level B, 6 to 19 minute) consultation is A$43.90. The bulk-billing incentive will be $21.85 if eligible patients are bulk billed in metropolitan areas, totalling $65.75 (or $73.97 if all the practice bulk bills all patient visits.

Larger bulk-billing incentives will apply in regional, rural and remote areas.

For the one-quarter of visits that aren’t bulk-billed, the average out-of-pocket payment is around $50 – significantly more than the bulk-billing incentive payment in metropolitan areas.

GPs and practice owners are now doing their sums to see if they should increase bulk billing. The government has produced a calculator to help them do this analysis.

Will your GP bulk bill? It will depend on these things

Six factors will determine whether a practice will shift to fully bulk billing.

1. Ideology

Some GPs and practice owners are resolutely opposed to bulk billing. Some believe patients won’t value their service if they don’t pay something. Others think bulk billing makes them too beholden to government.

2. Indexation risks

GPs may not trust the government to continue to index rebates annually in line with inflation. GPs have been bruised by the previous government’s freeze, and they don’t want to risk having to reintroduce patient billing if a future government freezes rebates again.

To overcome this concern, a recent review of GP incentive payments recommended an independent body sets the new rebate level each year.

3. Current out-of-pockets

Practices that impose very high out-of-pocket payment now will probably not change. Many of these are in wealthy areas.

The expansion of eligibility for the bulk-billing incentive and the added 12.5% uplift for 100%-bulk-billing may not be enough to offset the lost revenue for these clinics.

4. Current bulk billing rates

If a practice has low rates of bulk billing now, even with moderate out-of-pocket charges, moving to full bulk billing may also leave them with reduced revenue.

5. Offsetting consumer pressure

The government is embarking on a promotional campaign to encourage GP clinics to bulk bill. When a practice decides to bulk bill all patients, the government will encourage practices to advertise this by erecting a poster outside their clinic.

This may encourage patients to change doctors or quiz their GP or the clinic receptionist about why they’re not being bulk-billed. Consumer pressure may make life uncomfortable for GPs who continue to impose co-payments, especially in low-income areas.

6. Availability of alternatives

Expansion of alternatives to general practice, such as pharmacist prescribing, might lead to a drift away from practices that are still charging out-of-pocket fees.

Read more: Pharmacists should be able to work with GPs to prescribe medicines for long-term conditions

Is the government target achievable?

Contrary to the views of some GPs, the government target of 90% of all attendances bulk billed by 2030 will probably be achieved.

There will be an immediate uplift from the current rate of 79% when the new arrangements start on November 1. The current bulk-billing rate in areas with the lowest socioeconomic status is already 89% and that is likely to get even closer to 100% pretty quickly.

A combination of patient pressure, realisation that the sky has not fallen in under the new arrangements, and that this government can be trusted to index rebates, will mean the bulk-billing percentage will continue to increase over the next few years.

This means patients will face fewer financial barriers to access to essential primary medical care.

Correction: this article originally said the average out-of-pocket payment was less, rather than more, than the bulk-billing incentive payment. This is for metropolitan areas.