The Federal Government’s Medicare Benefits Scheme review has generated debate about whether users of health care are receiving insufficiently justified health care services, and the consequential issue of whether such services should be funded. Recently, the MBS review attracted controversy because of public statements that 30% of Australia’s $155 billion annual health expenditure was spent on services, tests and procedures that provide negligible clinical benefit, or at worst are unsafe and potentially harmful.1 Since then, it has been acknowledged that this figure was only a ballpark estimate of what the actual number may be, and that it may take up to 18 months before a more reliable estimate of the amount of such wastage is known.2

The difficulty for primary health care providers is that they are in the firing line for legal actions by their patients, for example if a relevant test, that could have identified a health issue, is omitted because it appeared to be unnecessary. It may be that there is a need for the public to be further educated about the role that they play in this issue when they give their consent to medical tests and procedures. Indeed, in its August 2015 Health Policy Report, the George Institute for Global Health acknowledged that patients have a role to play as ‘partners in care’, in the context of its recommendation for increasing public awareness about the need to modify funding approaches in order to improve Australia’s healthcare system.3

Some research published in the Medical Journal of Australia in 2012 concluded that it will probably be quite rare to find health services that are ineffective or unsafe across the entire population to which they are applied.4 It suggested that policies should be developed that allow for a more nuanced set of indications for coverage of particular healthcare services, in order to minimise the use of those services outside of those indications.5 When such policies are applied to fee for service healthcare funding models, the report said that it may require stricter clinical item and patient descriptors and fee refinements, whereas for program budget, bundled or capitated funding models, there could be incentives created to encourage the use of services that offer the best patient outcomes.6

A report by the Grattan Institute in August 2015 considered the issue of Australian hospitals that provide unusually high levels of do-not-do treatments.7 Although it acknowledged that there can be legitimate reasons for this, it nonetheless recommended that the Australian Commission on Safety and Quality in Health Care publish a list of do-not-do treatments and identify those hospitals that carry out unusually high numbers of such treatments.8 It also suggested that private health insurers should be allowed to withhold funding from such hospitals.

Given this broader context, it is important that those commissioning health care services pay increasing attention to the issue of how best to obtain value for money. Where this involves the use of financial incentives, clinicians will need to be properly consulted to obtain their input into the proposed incentives. This can help to avoid perverse consequences from inadequately considered incentives. That same Grattan Institute report mentioned that funding cuts, which might be used as a ‘last straw’ for any such hospitals that persisted in carrying out unusually high levels of donotdo treatments without an appropriate justification, should be applied with caution. This was because the use of simple formulas to carry out funding cuts could lead to gaming, and secondly that such funding cuts are likely to alienate clinicians.9

The risk of system gaming was one factor identified in an April 2015 report on the UK National Health Service by Dr Foster Ltd that considered the creation and use of performance metrics.10 It made a number of recommendations regarding the use of performance metrics that are worth noting by those commissioning healthcare services in Australia, including that:

  • data quality should be accorded the same importance as achieving targets
  • to limit the negative consequences of performance management systems, counterbalancing metrics should be monitored in addition to performance measures, and the performance measures should be constantly monitored and reviewed
  • performance measures should be assessed against the risks of likely negative consequences of their use, and that threshold measures, especially those with pass/fail outcomes, should be avoided wherever possible
  • data regarding performance management should be widely available and there should be ongoing assessment of the degree to which metrics are being gamed, and
  • performance measures should be applied fairly, so as to recognise legitimate mitigating factors such as resources and factors outside the control of the relevant organisation.