Revenue of consultant physicians for private out-patient consultations.

Objective The aim of this study was to determine the revenue to consultant physicians for private out-patient consultations. Specifically, the study determined changing patterns in revenue from 2011 to 2015 after accounting for bulk-billing rates, changes in gap fees and inflation. Methods An analysis was performed of consultant physician Medicare claims data from 2011 to 2015 for initial (Item 110) and subsequent (Item 116) consultations and, for patients with multiple morbidities, initial management planning (Item 132) and review consultations (Item 133). The analysis included 12 medical specialties representative of common adult non-surgical medical care. Revenue to consultant physicians was calculated for initial consultations (Item 110: standard; Item 132: complex) and subsequent consultations (Item 116: standard; Item 133: complex) accounting for bulk-billing rates, changes in gap fees and inflation. Results From 2011 to 2015, there was a decrease in inflation-adjusted revenue from standard initial and subsequent consultations (mean -$2.69 and -$1.03 respectively). Accounting for an increase in the use of item codes for complex consultations over the same time period, overall revenue from initial consultations increased (mean +$2.30) and overall revenue from subsequent consultations decreased slightly (mean -$0.28). All values reported are in Australian dollars. Conclusions The effect of the multiyear Medicare freeze on consultant physician revenue has been partially offset by changes in billing practices. What is known about the topic? There was a 'freeze' on Medicare schedule fees for consultations from November 2012 to July 2018. Concerns were expressed that the schedule has not kept pace with inflation and does not represent appropriate payments to physicians. What does this paper add? Accounting for bulk-billing, changes in gap fees and inflation, revenue from standard initial and subsequent consultations decreased from 2011 to 2015. Use of item codes for complex consultations (which have associated higher schedule fees) increased from 2011 to 2015. When standard and complex consultation codes are analysed together (and accounting for bulk-billing, changes in gap fees and inflation), revenue from initial consultations increased and revenue from subsequent consultations decreased slightly. What are the implications for practitioners? Efforts to control government expenditure through Medicare rebate payment freezes may result in unintended consequences. Although there were no overall decreases in bulk-billing rates, the shift to higher-rebate consultations was noticeable.