The 2014 Federal Budget has prompted much commentary and opinion. A key policy change of particular focus has been the proposed introduction of the Medicare co-payment.  The co-payment is a marked shift away from the current Medicare model and it will be interesting to observe what, if any, flow-on effect it has on providers of medical services and, potentially, insurers.

The Budget included an announcement that from 1 July 2015, patients can expect to contribute $7 towards the cost of a standard GP consultation and out-of-hospital pathology and imaging services.  For those patients who qualify for a concession (including children under 16 years of age), the contribution will be $7 for the first 10 services each calendar year. The charging of the $7 co-payment will be at the discretion of the provider of medical services and, if it is charged, $2 of the co- payment will be returned to providers.  The Medicare rebate that providers receive when they “bulk-bill” a patient is also forecast   to decrease by $5.  The reforms further indicate that states and territories will be able to introduce patient contributions for GP equivalent visits to emergency departments.

Since the Budget announcement, there has been significant speculation about what the co-payment will mean for consumers of medical services.  What, however, will it mean for the providers of those medical services and will the co-payment ultimately impact on medical malpractice claims?

Various stakeholders have criticised the introduction of the co- payment arguing that it poses a threat to doctors’ businesses.  It has been suggested that medical practitioners could face financial pressure in circumstances where they choose to waive the co-payment so that their patients can continue to access medical care. This is particularly relevant to those doctors practising in lower socio-economic areas where bulk-billing is standard practice and patients may not be able to afford the $7 co-payment. It has been suggested that medical practitioners may have no choice but to spend less time with each patient to compensate for the shortfall in their income. Commentators further suggest that public hospital emergency departments will be put under increasing pressure because patients may present there for treatment, instead of visiting their GP, if they cannot afford or wish to avoid the co-payment.

It has also been suggested that patients will delay visiting their GP to avoid the co-payment and thus, their medical condition may be further progressed or significantly worsened by the time they do seek medical care.

It remains to be seen how the introduction of the co-payment (if indeed it is implemented in the current proposed form) will affect the quality of care that medical practitioners and hospitals are able to offer patients, and whether the increased pressure the co-payment may put on medical practitioners will ultimately result in a higher volume of medical malpractice claims.