Why am I paid a % of billings in Australia and what is the service fee that the practice keeps?
In Australia most primary care services are funded through Medicare and general practitioners (GPs) receive most of their remuneration through fee-for-service (FFS) payments, which is where the GP bills an amount for the provision of an individual service. Around 80% of GP services are bulk billed, meaning the GP directly bills Medicare for the patient visit rather than billing the patient.
The Medicare rebate is $43.90 for a standard visit to a GP. However, some GPs charge more than this. In this case, the patient needs to pay the difference, which is called a ‘gap fee’. For example, if a GP charges $70 for a patient consultation the patient will need to pay the remaining $26.10.
This is the difference between bulk billing and private billing. A practice that offers a mixed billing policy will bulk bill some items but charge a gap fee for others.
The service fee that the practice retains assists them to pay for all the aspects of running the practice that allows you, as a General Practitioner, to work. This includes:
- Rent of the premises
- Utilities such as electricity, water, phone, and internet
- Insurances- both building, contents, indemnity, and liability
- Wages for the staff including reception, practice management, nursing and other support staff
- Technology- including licences, software, and hardware
- Furniture, equipment, and equipment maintenance
- Marketing & Advertising the services offered by doctors at the practice
- Disposables- such as dressings, tests, specimen jars (and so much more)
Essentially the practice takes care of as much as possible so that you can turn up to work and focus on what you do best, seeing your patients!
