National Cancer Data in one Place!

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Have you seen the National Cancer Control Indicators (NCCI) website?

It is Australia’s first single location of cancer data.

An initiative of Cancer Australia, the national cancer control agency, this data resource launched last November. The framework above shows the sources and type of data collected. The Australian Bureau of Statistics (ABS) and Australian Institute of Health and Welfare (AIHW) feature prominently as data custodians.

Data is updated dynamically on the site as it becomes available and can be displayed as required using interactive features. The information is organised around the cancer journey from Prevention, Screening, Diagnosis, Treatment and Outcomes. Two further domains, Research and Psychosocial Care, are currently under development.

The site acknowledges that there is a large degree of variation in the availability and completeness of data for some cancer domains, and for certain tumour types. The data is still also relatively old, with the recently released National Cancer Stage at Diagnosis analysis dating to 2011. Despite these caveats, which will improve moving forward, it is a fantastic initiative and invaluable to policy makers, researchers and reimbursement submission writers!

Is this service Bulk Billed?

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The status of out-of-pocket (OOP) costs paid by Australian patients for healthcare continues to be an enigma. On one hand, regular media releases, reports & inquiries suggest it is an issue; while on the other, Australian Institute of Health & Welfare figures support a conclusion of limited growth in this component of healthcare spend, although somewhat blurred between public and private settings.

Clinician fees are one place where precise data, incorporating both public and privately provided services, are available, courtesy of the Department of Human Services Medicare payment system. Medicare bulk billing is at the discretion of the health professional. Patients assign their right to the Medicare benefit amount to the health professional, meaning the patient pays nothing and the health professional accepts the Medicare scheduled fee as full payment for provision of the service.

The Australia-wide Medicare schedule fee observance statistics for 2016-17 (see graph) show that the majority (over 80%) of doctor visits are bulk billed. However, removing the impact of the relatively higher volume of GP visits, reveals that approximately 65% of specialist visits did require an out-of-pocket payment by the patient during that period.

In defence of clinicians, the MBS rebate indexation freeze, first introduced for nine months by Labor in 2013, and a further 4-years from July 2014 by the Coalition, is considered a key factor contributing to the increasing gap (OOPs) between patient’s Medicare rebates and medical fees. The decision to extend the freeze for a further two years in 2016 was partially wound back in the 2017-18 Budget, with the provision of $1.0 billion to reintroduce indexation for certain items on the MBS.

‘Rebate gate’ (Part 2 of 2) – Potential Consequences

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Will the real price be revealed?

As described in Part 1, the Australian Federal Government wants to eliminate an existing process whereby certain PBS medicines are reimbursed through the supply chain at ‘published (list) prices’, even though a lower price, known as the ‘effective price’ has been agreed. At a latter date, sponsor companies repay (rebate) the difference between these two prices to the Government. For medicines where this applies, the real price paid is kept confidential for international reference pricing purposes, with the trade-off being subsidised access for Australian patients.

The schematic shows a simplified version of the current flow of money and product through the supply chain from manufacturer to patient based on the published price in the PBS schedule. Note that as mark-ups and fees are calculated on the published price, relevant adjustments are made and also repaid by sponsor companies as part of rebate amounts.

Who pays and when?

The Government is proposing that instead of one Medicare payment being made to a pharmacy on submission of an eligible claim for a dispensed PBS item, for those products to which a rebate applies, the Government will directly pay each step in the supply chain the relevant amount based on the effective price.

Two potential consequences become clear:

1.      Loss of confidentiality of the ‘effective price’. This should be of concern, as it means Australia may be moved to the end of the list of countries provided with the registration dossier for a new medicine. This will add years to the wait for innovative medicines before the TGA or the PBAC even get to consider the value offered to the Australia public.

It is the perfect storm as local affiliates will be forced to sacrifice access for Australian patients for markets that reference to PBS prices. This is a very real phenomenon, and decisions not to launch, or withdraw products have already been made locally by companies due to international reference pricing concerns.

You don’t need to look far to appreciate what the future may look like.

2.      Business mayhem. What happens to well-established terms of trade and legalities around ownership of goods and responsibility for product condition (cold chain continuance, breakages, delivery failures, etc.) with a move to agent status on the basis of ‘phantom’ invoices? The payment of GST as required at the various steps in the process will also need new systems and processes to ensure that obligations to the Australian Tax Office continue to be met (watch this week’s abc Four Corners program).

A way forward?

Without compromise, it is unlikely that change of such magnitude will be in place by the arbitrary time frame of 1 July 2018. Retaining the current arrangements with tweaks seems most sensible. What about tighter (such as, monthly) time frames around repayments to the Government? This would require a quicker turnaround of invoices than has currently been the case. Another option is for companies to pay rebates (monthly or quarterly) in advance based on Deed agreed utilisation estimates. Perhaps you have a better idea?