Medicare bulk billing and out-of-pocket costs of GP attendances over time

Bulk billing incentive (BBI) payments, which were introduced into the MBS on 1 February 2004, are payable to health practitioners when the following conditions are all met – the service is:

• bulk billed
• an unreferred service
• provided outside of a hospital
• provided to a patient who is aged under 16 or who holds a Commonwealth concession card.

BBI payments are not captured with the service to which the item relates. BBIs for unreferred GP attendances (and other unreferred services) are captured in the MBS Category 8 Miscellaneous services, Group M1 Management of bulk billed services. (Note, there are also BBIs for unreferred diagnostic imaging and pathology, however these are not in Group M1).

Since the commencement of the triple BBI payments on 1 November 2023, the total number of BBI items claimed for all BBIs (standard and triple BBIs) in Group M1 increased from 77.5 million in November 2022–October 2023 to 82.3 million in November 2023–October 2024, an increase of 6.2%. Over the same period, the amount of benefits paid increased from $611.0 million to $1.7 billion (185%).

The AIHW will develop an estimation method to associate BBI items in Group M1 with the service item to which they relate. The AIHW intends to report measures on BBIs for GP attendances in a future release of the Medicare GP bulk billing dashboard.

A deflator is used to derive constant price estimates – dollar amounts for different years that are adjusted to reflect the prices in a chosen base year. This allows spending over time to be compared on an equal dollar-for-dollar basis without the distorting effects of inflation. The comparison will reflect only the changes in the amount of goods and services purchased – changes in the ‘buying power’ – not the changes in prices of these goods and services caused by inflation.

The base year used in this report is the latest calendar year 2023. As such, constant price estimates indicate what spending would have been had the 2023 price been applied in the previous years. Therefore, any reported change in spending is a measure of changes in the volume of goods and services purchased, and not the cost of the goods and services.

The AIHW uses deflators where the scope matches the particular health services being analysed, rather than general deflators covering all health services. Most are specific to the type of spending to which they are applied. For medical services in this report, the MBS medical services fees charged deflator is used and is derived by the AIHW.

All areas are based on patient location (instead of GP practice location). Patients may access GP attendances outside areas where they live. GP bulk billing rates and average out-of-pocket costs may not reflect the charging practices of GPs who practice in the same area as the patients live.

Local Government Areas

LGAs cover legally designated parts of a state or territory, for which incorporated local governing bodies have responsibility. The LGAs presented in this report are ABS LGAs which are ABS approximations of official local government boundaries as defined by each state and territory. ABS approximations of administrative boundaries do not match legal boundaries and are used for statistical purposes only.

There are 547 LGAs in this release, covering the whole of Australia without gaps or overlaps. These LGAs included unincorporated areas which are areas in some states and territories not administered by incorporated bodies. An LGA can be abolished, created, or changed significantly in boundary. The LGA boundaries in this release have been applied historically for all years for comparison purposes.

Postcodes

Statistics are based on the location of the patient, not the location of the provider. Patients may travel outside their LGA to receive services. LGAs show where people live rather than where people access their services and may not reflect the practices of the providers who provide their services in those LGAs.

The MBS enrolment postcode at the time of the claim being processed is used as a proxy for the patient residence. An enrolment postcode is a mail delivery postcode and this may differ from some patients’ residential address. Some postcodes that only represent Post Office boxes and not residential areas (for example: General Post Offices or mail delivery centres), have not been allocated to an LGA as they are not a good indicator of where the patient lives. However, they have been included in state/territory and Australian totals. Likewise, enrolment postcodes that cannot be allocated to an area, are included in the Australian total only.

Some patients change enrolment postcode during a month. In compiling statistics for the month, MBS records are allocated to a patient’s major enrolment postcode in each month based on the largest number of services, before being aggregated to monthly statistics. The same approach applies to compiling annual statistics.

An ABS correspondence is used to proportionately allocate postcode level data to LGA. The population distribution within any postcode (within an LGA or across more than one LGA) reflects that as of the 2021 Census.

During the late 1980s, Northern Territory postcodes moved from the range of 5750–5799 to their current range of 800–899. These previous postcodes are not present in the latest postal area to LGA correspondence, consequently statistics are unavailable at the LGA level for early periods for most Northern Territory LGAs.

Caution should be exercised when interpreting LGA statistics in the Northern Territory. These statistics are under-represented because of a high proportion of Northern Territory residents enrolled in the MBS using Post Office box addresses. Unless the Post Office box postcodes are the same as residential postcodes, the non-residential postcodes are not assigned to an LGA, but have been included in the Northern Territory and Australian totals.

Socio-Economic Indexes for Areas

The Index of Relative Socio-economic Disadvantage (IRSD) is one of 4 Socio-Economic Indexes for Areas (SEIFA) developed by the Australian Bureau of Statistics (ABS) (ABS 2023). The IRSD represents the socioeconomic position of Australian communities by measuring aspects of disadvantage, such as low income, low educational attainment, high unemployment, and jobs in relatively unskilled occupations. Areas are ranked according to their level of disadvantage.

In this report, socioeconomic areas are based on the IRSD. People living in the 20% of areas with the greatest overall level of disadvantage are described as living in the ‘lowest socioeconomic areas’ (quintile 1). The 20% of areas at the other end of the scale – those living in areas with the least overall level of disadvantage – are described as living in the ‘highest socioeconomic areas’ (quintile 5).

It is important to note that the IRSD reflects the overall or average socioeconomic position of the population of an area; it does not show how individuals living in the same socioeconomic area might differ from each other in their own socioeconomic positions.

Australian Statistical Geographical Standard for Remoteness Areas

Remoteness for areas in this report have been defined by the Australian Statistical Geography Standard (ASGS) Remoteness Structure (ABS 2021). This structure allows areas that share common characteristics of remoteness to be classified into broad geographic regions of Australia. These remoteness areas are characterised by their relative geographic access to services:

• Major cities
• Inner regional
• Outer regional
• Remote
• Very remote.

The ABS website includes detailed information on the ASGS, including the key changes made between each edition.

The measures used in this report are calculated on a monthly or yearly basis. Monthly statistics are influenced by the number of working days from month to month.

Bulk billing is when the GP (with the patient’s agreement) accepts the patient’s Medicare rebate as full payment for the service. The GP bulk billing rate (%) for a given time interval (monthly, annually) is defined as:

The average out-of-pocket costs ($) that patients paid for GP attendances (non-hospital services) when they were not bulk billed for a given time interval is defined as:

GP attendances used in the calculation of bulk billing rate are for all services, while those used in calculating the out-of-pocket costs are for non-hospital services. Furthermore, the out-of-pocket costs calculation included those GP attendances where patients were charged the same amount as the rebate, which resulted in zero out-of-pocket costs to the patient. This is consistent with reporting of Medicare statistics.

Statistics in this report are based on the date the GP attendance was provided. It is possible for service volumes to change between releases of statistics due to the late lodgement of claims and adjustments to claims. The last 3 months of statistics are considered to be preliminary as they are incomplete and subject to revision due to claims still being submitted to Services Australia for processing and payment.

Medicare is Australia’s universal health insurance scheme. It provides free or subsidised access to services provided by doctors and certain other medical practitioners for all Australians (and some overseas visitors). The services covered by Medicare are contained in the Medicare Benefits Schedule (MBS).

The MBS is a listing of all of the medical services subsidised by the Australian Government, to provide patients with financial assistance towards their healthcare costs. It also sets out the ‘schedule fee’ for each service to determine the amount of the patient rebate.

The schedule fee is a fee-for-service set by the Government and may differ from the GP’s actual fee, which they are free to determine. If the GP chooses to accept a fee equal to the Medicare benefit, the patient can assign the benefit from the Government to the practitioner as full payment of that fee. When this is offered to a patient, it is referred to as ‘bulk billing’. Alternatively, if the GP charges a fee that is higher than the benefit, the gap between the fee and the Medicare benefit is paid by the consumer as an ‘out-of-pocket’ cost.

Medicare benefits are claimable only for services provided by an appropriate health practitioner and which are listed on the MBS.

Scope of MBS statistics

MBS statistics only include services for which an MBS benefit was paid. They do not include services:

• provided by hospital doctors to public patients
• provided under the Department of Veterans' Affairs National Treatment Account
• covered by third party or workers' compensation
• delivered to repatriation beneficiaries or defence personnel
• delivered for insurance or employment purposes
• that are funded directly by other Australian Government programs (such as health screening services)
• funded directly by State/Territory Government programs.

ABS (Australian Bureau of Statistics) (2021) Remoteness Structure: Australian Statistical Geography Standard (ASGS) Edition 3, ABS, accessed 19 August 2024.

ABS (2023) Socio-Economic Indexes for Areas (SEIFA), Australia, 2021, ABS, accessed 19 August 2024.

ABS (2024) Patient Experiences, 2023–24, ABS, accessed 19 November 2024.

Commonwealth Department of Health, Housing and Community Services (1991) Medicare Benefits Schedule Book [PDF 18.7MB] Commonwealth Department of Health, Housing and Community Services, accessed 30 September 2024.

Department of Health and Aged Care (2020a) Bulk Billing Incentives Frequently Asked Questions, Department of Health and Aged Care, accessed 30 September 2024.

Department of Health and Aged Care (2020b) 6 April 2020 News - Changes to COVID-19 services, Department of Health and Aged Care, accessed 30 September 2024.

Department of Parliamentary Services (Cth), Bills Digest (Digest no. 58, 2004–05, 29 November 2004), Health Insurance Amendment (100% Medicare Rebate and Other Measures) Bill 2004 [PDF 337KB], accessed 30 September 2024.

Parliamentary Library (2017) Budget Review 2017–18 [PDF 2.5MB], Department of Parliamentary Services website, accessed 30 September 2024.