General Practices in Australia are struggling to generate enough revenue. That results in lower profits, inability to buy supplies and staff cuts. Why are Australian GP clinics in dire straights?
The answer is simple. There is a combination of factors:
- Medicare benefits did not rise to reflect the costs of running the practice.
- The costs of running the practice grew 200% to 300% in the last ten years.
- COVID-19 pandemic negatively affected the ways practices operate.
The Government offered Australian GPs a solution – to drop the bulk billing. For those who already privately bill, the Government suggested increasing the gap. Surely, this advice would be sensible if the economy was booming, the wages were not lagging behind the inflation and the interest rates were not rising. The reality is that bulk billing or partial low private billing is here to stay if practices wish to retain the clientele.
I can see one consulting client asking for more and different ways to improve their earnings. Almost all of them came up with ideas that were discarded as ineffective long ago. Examples of those ideas are cold calling patients to come back for Health Assessments or trying to do a Heart Check (item 699) industrially. Practices discarded those ideas before for being costly and ineffective.
What can be done, asking themselves practice owners. The answer lies in a bonafide intervention program that may result in a solid 20% – 30% increase in revenue with no or very little investment.
The proven revenue boost for any practice starts with three fundamental principles:
- Whatever we do must be beneficial to the patients.
- Must be compliant with Medicare rules and be EBM.
- Must be confidently profitable.
Please, tell me if doing item 699 (Heart check) that pays a meagre $75.75 for the work that may take up to 40 minutes is in any way confidently profitable. Or, perhaps cold calling patients to come for a Health Assessment that results in 0.1 – 0.01% return at the staff cost of $50/hour is confidently profitable.
The simple fact is that the only intervention that would work is a well designed Chronic Disease Management program. Please, do not drop everything and demand from your GPs to bill more Care Plans – that will backfire terribly, I guarantee you.
A well designed Chronic Disease Management (CDM) program starts with the campaign of active engagement of the patients. I envisage writing about ‘active engagement’ soon. (No, it is not calling patients asking them if they want a Care Plan, God forbid).
Marketing of the CDM system is an integral ingredient for success here. The doctors, nurses and relevant admins need to be inducted into compliance and appropriate billing procedures. Clinical pathways for each aspect of CDM need to be developed and put together in a system. That sounds like a big job. Well, it is a big job. I have been building these GP systems for over 20 years. I know what the proper system should look like.
This intervention does not need to be expensive. There are private consultants offering to share ‘revenue boosting’ tips for a few thousand dollars. If what is offered does not look like a system it is not a system. The good news is that there are some very decent people in the consulting field. Sorry, I am not available for this service till August 2022 except for a few regular clients.
Running GP clinics is hard work. One who does that deserves a prosperous secure life. I wish everyone in General Practice to overcome the current challenges.