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Doctor examining patient x-rays.

Medicare Payment Freeze – How Can Doctors Manage?


Jul 30, 2018


The Medicare payment freeze was introduced as part of a savings scheme by the government in 2013. This plan has had many vocal opponents since it’s inception. How does it affect doctors like you? And what can you do about it?

Medicare Payment Freeze: The Impact on Doctors

As the costs of health care continue to rise, doctors are left stuck with the bill. The freeze means that what doctors were reimbursed for by Medicare in 2014 is the same payment they can expect right through 2020. That’s some six years without an increase in payments. Meanwhile, expenses are on the rise.

You have to pay more each year for:

– Rent

– Utilities

– Equipment

– Staff salaries

– Technology

– Supplies

Overall, it could lead to less income for your general care practice.

Is the Medicare Payment Freeze Backfiring?

The savings scheme was intended to slow down the bulk-billing method and save the government some money. But the plan seems to have backfired.

In order to generate more income to cover the rising costs of providing care, general physicians are trying to see more patients than ever before. This means that they are thus claiming more Medicare reimbursements per patient and has led to an increase in bulk-billing rates – the very problem the government was trying address in the first place!

The system creates other problems. The freeze on Medicare puts more of a burden on the patient, too. Patients who can’t afford more expensive care are forced to settle for cheaper procedures or even to avoid treatment altogether. This will create bigger problems down the road as more people develop chronic and complex diseases due to avoiding costly primary care.

What Doctors Can Do

Until the freeze is completely lifted, what can you do to protect your practice and still provide your patients with quality care?

When it seems impossible to increase your income then it’s time to get smarter about what you do with the cash that is rolling in.

Don’t hastily start cutting out hours and services. Instead, take the time to sit down and develop a sharp growth strategy. Take a look at your processes and use of time and see what changes you can make to get more done in less time. Maximise efficiency to improve your cash flow. Delegate as many small tasks as you can so that you can devote your time to money-making procedures.

See where you can update your billing policy and streamline payments. Design a clear and easy-to-understand policy for your practice that your patients will easily understand to boost cooperation.

Create a distinct plan to help your practice adjust to the current economic conditions so that you can see steady and constant growth, however small it may be.

Most importantly, get advice from financial experts who understand the unique challenges that doctors are facing.

Contact Nitschke Nancarrow managing partner Kym Nitschke for a free initial discussion about your situation. Call us on (08) 8379 9950 or send me an email.

– Kym Nitschke

The information contained on this web site is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser.

Taxation, legal and other matters referred to on this website are of a general nature only and are based on Nitschke Nancarrow’s  interpretation of laws existing at the time and should not be relied upon in place of appropriate professional advice. Those laws may change from time to time.

Nitschke Nancarrow specialises in accounting, tax and financial advice for superannuation. Contact us now for a no obligations discussion about your needs.

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