Billing Transition in Medical Imaging - a 2010 presentation by Rob Maroszek - Trends in Patient Bulk-Billing in Australia - Viability of Billing Scheme - Cost vs. Revenue of Radiology Service Providers - Value vs. Pricing Strategy - Implications - Education & Embracing Change - Outcomes - Presentation and discussion by MEDIMCO www.medimco.com.au

1. The Billing Transition
Reasons & Implications
Need for Change
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 1

2. Bulk Billing on the Decline?
Copyright, Medicare 2008
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 2

3. In the News
• Medicare environment makes it increasingly
difficult for GPs to rely solely on bulk-billing
“Several GPs told Australian Doctor that claims for the $5 and $7.50
MedicarePlus incentives for patients who they believed were clearly eligible —
including an 80-year-old pensioner — had been rejected since the HIC started
checking patients’ concessional status before paying GPs on 15 November. ..
…Sydney GP Dr Barrie Leon said he was livid the HIC had not paid him the $5
incentive for three claims, despite the fact he had sighted the patients’
concession cards. ..
…The rejection of 50 of his incentive claims was the last straw for Dr Tony Nigro,
of Hurstville, Sydney, who said he planned to stop bulk-billing — which he
currently does two days a week — and move to private billing for all patients
from January.”
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 3

4. In the News
• The decline of GPs who bulk-bill is
imminent. Is it definite?
“…The proportion of doctors who bulk bill all patients will fall
from 18% today (down from 26% a year ago) to less than 4% in
12 months time…
Similarly, the proportion of doctors who do not bulk bill will rise
from 12% today (up from 6% a year ago) to 19% over the next
year…
More than 60% of doctors will reduce the number of patients
that are bulk billed…”
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 4

5. In the News
• AMA continues suggesting MBS needs revision.
• Past Revisions
”…a 15-minute GP consultation is currently valued at around
$27.00. A bulk billing doctor receives only $22.95 under
Medicare…
Our independent modelling of the RVS shows that the real value
is at least $44.00…
No wonder, then, that doctors are shifting away from bulk
billing in droves…
If the MBS is not revised, doctors will simply have to turn away
from Medicare, the Government insurer,"
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 5

6. In the News
“…Mr Scott said he went into Dr Nachiappan’s Surgery on the
town square this week seeking a referral but was told there
were no bulk bill appointments available and he should try
again at the end of the month…”
“…It’s made things quite difficult,” Ms Rebbeck told the BDT. She
said bulk bill appointments were always the first to go at the
surgery which did offer Mr Scott an emergency appointment…”
“…In the interest of sound clinical practice we have emergency
appointments available daily although once bulk billing facilities
are exhausted, then only the paying slots area available...”
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 6

7. In the News
• The decision to phase out bulk-billing becomes much easier
once we realise it is the only way for a practice to survive…
“…Bulk-billing just "unviable", says Wendouree doctor
Ballarat recorded the greatest drop in bulk billing in the nation,
with rates dropping from 52.8 per cent to 43.8 per cent in the
first three months of the year…
Dr Colin Crook said it was a unanimous decision by the five
doctors at the Gillies St Medical Clinic in Wendouree to stop
bulk-billing…
"It was a decision we took about a year to make so it wasn't
taken lightly," he said…”
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 7

8. In the News
• Some large practices made a risky move
(patients could have simply turned away)
but ultimately made the right move…
“AUSTRALIA'S largest medical centre operator has scrapped
bulk-billing for most of its South Australian patients - charging
$30 an appointment for the same service it provided freelast
week.
The Australian Medical Association yesterday warned the
number of free doctors was dwindling because Medicare rebates
were seen to be too low for medical centres to remain viable... ”
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 8

9. In the News
• Bulk-billing alone is NOT a viable patient
reimbursement scheme
"The Medical Benefits Schedule was established over 20 years
ago and since then has never kept pace with either average
weekly earnings or the cost of medical services, and the other
problem is that there is an increasing burden of red tape and
administrative costs and it's no longer sustainable to continue
charging at bulk-billing rates for the majority of medical
services… “- says AMA state president Dr Andrew Lavender
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 9

10. In the News
• This mentality is a major “stumbling block”
• Practitioners provides a truly valuable
service, yet themselves are undervaluing it…
“…I bulk-bill, not because it’s financially viable, I do it because
many people are economically stressed, and secondly, I don’t
feel I should collect for this service,’’ Dr Ladhams said. ``That’s a
philosophical argument, but when people are sick it is often
harder for them to stay financially stable...’‘
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 10

11. In the News
• Pathology firms had to adjust their pricing
model in the past
• Ones that didn’t are struggling financially
``…We have all received letters from the major pathology
companies informing us of the reduced Medicare benefit
provided by the Federal Government for their services,’’ he said.
``…They’ve requested that we do not request all patients be
bulk-billed for pathology services. Bulk-billing is to be restricted
to pensioners, health card holders and possibly those with
chronic and complex conditions that require multiple testing...’’
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 11

12. High-end Service +
Bulk Billing
Low-end Service
Bulk Billing
High-end Service
Privately Billing
Low-end Service
Privately Billing
C
o
s
t
Profitability
Billing Policy & Pricing Strategy
Cost of
running the
Practice
(Equipment,
people)
Cost vs. Revenue
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 12

13. • GP Clinic Bulk-Billing Trends
applicable to Radiology Service
Providers?
The “4 Quadrants”
of Radiology Provider Types
Value vs. Billing
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 13

14. High-end Service +
Bulk Billing
Low-end Service
Bulk Billing
High-end Service
Privately Billing
Low-end Service
Privately Billing
Relying on Medicare Relying on Medicare + Patient
payments
- Radiologist on-site
- Electronic reports
- Updated equipment
- Excellent
technologists
- Marketing &
Communication with
referrers
- Better patient service
- Older equipment
- No on-site
Radiologist
- Limited services
- focus on patient
turnaround
- Overworked MITs
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 14

15. High-end Service +
Bulk Billing
Low-end Service
Bulk Billing
High-end Service
Privately Billing
Low-end Service
Privately Billing
Fast,
premium
service, value-
added
Low cost
service for
undemanding
patient
Company is
loosing money.
Unique cases
only
Unaware
Patient. Will
not come
back
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 15

16. High-end Service +
Bulk Billing
Low-end Service
Bulk Billing
High-end Service
Privately Billing
Low-end Service
Privately Billing
C
o
s
t
Profitability
TRANSITION
Viable & Sustainable Solution
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 16

17. Transformation Steps
•Aware of the Need
•Desire to Change
Awareness
+ Desire
•Benefits &
Implications for
Practice, Patients,
Referres
•Educate Referrers
Understanding
+ Education •Support the Change
•Communicate about
Negative feedback
(from Patients &
Referrers)
Collaboration
•Support the Change
•Take Action if
required
Commitment
•Take initiative to
sustain & improve the
performance
Advocacy
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 17

18. Competence Confidence
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 18

19. All about communication
to the Marketplace!
Marketplace
Participants:
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 19

20. Communication Pipeline
Radiologist
Radiology
Marketing Radiology
Front Office
Referrer Patient
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 20

21. Clinical Avenue of Communication
MSI
Radiologist
Referrer
• Present the Value Added Component
• Personalise the Service and Experience
• Achieve Mutual Understanding about Sustainable Billing
Policy
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 21

22. “Liaison” Avenue of Communication
Radiology
Marketing
Referrer
• Sell Service, Competency & Value, NOT billing
• Focus on commitment to the Patient experience, NOT Patient
turnover
• Listen carefully, address concerns (from Clinicians & Patients)
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 22

23. “Front Line” Communication
Admins &
Front Office
Referrer Patient
• CRUCIAL line of
Communication
• Empathetic Listening
• Focus on Benefits
and True Value
• Stay committed to
the positive change
• Educate the patient
about forms of
Medicare
reimbursement
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 23

24. Short-term & Long-term Benefits
“KEEPING AFLOAT”
- Bulk Billing is only
a short term
benefit for the
patient, in the long
term Radiology
Practice is in
jeopardy
ATTRACT & RETAIN
GREAT DOCTORS
- Private Billing will
enable having
excellent hands-on
Radiologists on
site
INCREASE PATIENT
CARE TIME
More accurate
results
less patient
anxiety
Better with
children
LESS PATIENT
WAITING TIME
BETTER FACILITIES
FASTER RESULTS
Better Report
Turnaround Time
NEWER
EQUIPMENT
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 24

25. Satisfied Patients
• Patients as consumers appreciate less
the items that are “free”
• “Basic Psychology of Consumer
Choice”
paying for something, even
symbolically $1 creates commitment
• With private billing, Patients will
expect more, but will also be more
involved in the process
• Ultimately if treated right will leave
the practice more satisfied
EVERY TIME!
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 25

26. Questions & Discussion
www.medimco.com.au
(c) MEDIMCO, Presenter: Rob Maroszek2010-2011 26