Nature abhors a vacuum, and with government underfunding general practice, is it any wonder Bupa has become the latest insurer to step into the breach?
There is no downside to private health insurers buying into the business of running GP clinics, and it will save patients, health funds and the healthcare system money in the long run, says the boss of Private Healthcare Australia.
Bupa is the latest insurer to stretch its wings into the world of general practice, announcing that it is already running two “pilot centres” — one in Seaforth in NSW and one in North Balwyn in Victoria – and wants ultimately to have “60-100” GP clinics under its banner across the country.
The insurer said it would focus for now on buying existing centres, with new developments also part of the plan going forward.
The centres will be open to the general public as well as Bupa customers.
The Seaforth location was a clinic already under Bupa ownership, while the North Balwyn clinic was an independent clinic purchased by the fund.
“We have partnered with GPs at those sites who will provide clinical services,” a Bupa spokesperson told HSD today.
Dr Rachel David, CEO of Private Healthcare Australia, the beak body for the private health sector, including insurers, dismissed worries that Bupa’s move, as well as those of its competitors also getting into primary care, would create a “two-tiered” health system.
“To be honest, we’ve got a two-tiered system now,” said Dr David.
“We’ve got people who can and who can’t afford to see a GP, and that is a diabolical situation.
“It’s actually good that the big funds are starting to address this.”
Bupa’s strategy is called “Connected Care” and it involves offering integrated GP, allied health and pathology services using its existing network of 178 dental clinics and 49 optical and hearing stores, to create a “nationally distributed network of healthcare centres”.
The company’s digital health platform Blua will be the front door to a range of strategies including a door-to-door chemist delivery service recently launched to all 4.3 million health insurance customers; 24/7 virtual doctor consultations – currently available to international Bupa health insurance customers – and almost one million domestic health insurance customers as part of a trial where they can access up to three free consultations per year; online health tools and information to help customers navigate, assess, and learn about their health.
“In the long-term, our aim by bringing services together physically and digitally is to deliver simple, person-centred care – the ‘right care’ in the ‘right place’ at the ‘right time’. We want to be a true partner in our customer’s healthcare,” said Bupa’s APAC CEO Nick Stone.
“Access to clinicians and services will be supported by technology and underpinned by safe, secure, and intelligent data for a more seamless and less confusing health experience.”
Medibank owns 90% of MyHealth Medical Group, and nib is in the telehealth business through HubHealth.
Private health funds were responding to data telling them what their members had identified as a gap in the market – the ability to access a GP easily and at a reasonable price, said Dr David.
“The private funds are constantly given data about what their members want for their healthcare,” she told HSD.
“What they’re doing is reacting to consumer demand about market failures. This is a reaction to what consumers perceive as wrong with the system. They’re saying ‘I can’t even get my specialist care because I can’t afford to see a GP’.
“This is not so much the fund directing patients in a particular way – they are providing what consumers have asked for.”
AMA President Professor Steve Robson told HSD’s sister publication The Medical Republic that the organisation was concerned.
“The AMA does not believe that it is possible to reconcile the conflict of interest inherent in a vertically integrated organisation that spans both the funding and the provision of care,” they said.
“A fundamental principle of Australia’s healthcare system must be that a patient’s care pathway is determined only by clinician and patient.
“As we have seen in the United States, models that seek to manage patient care do not deliver better outcomes for patients and come at a much higher cost due to the inherent inefficiencies of the managed care model.
“It is a major concern that private health insurers have been permitted to buy into the healthcare delivery space. Regulatory oversight of this part of the sector is entirely prudential and competition based – there is no one considering the impact these models will have on our health system or patient care. The system needs an independent regulator to ensure these decisions are scrutinised and doctors and patients are protected.”
The Bupa spokesperson said the fund believed the relationship between individuals and their clinicians was “extremely important”.
“This initiative is about supporting a more customer-centric and modernised healthcare journey and offering our customers more choice, value for money and convenience when it comes to managing their healthcare,” the spokesperson told HSD.
“Bupa supports full clinical autonomy for all medical practitioners.
“We believe preserving the autonomy of healthcare providers and allowing them to make independent decisions is fundamentally important to deliver the best health outcomes for a patient. Bupa does not support introducing a US-style managed care approach.”
Dr David said concerns about the move being a short ride to a US-style “managed care” system were unfounded.
“‘Managed care’ is not a meaningful term in Australia,” she told HSD.
“The funds cannot directly employ a private doctor, they cannot directly compel a private doctor to sign up to any of their schemes or services. And they cannot operate a ‘narrow network’.
“Yes, they can contract with a major hospital but even if a hospital falls out of contract, they still have to pay claims in that hospital,” she said.
“With all of those bits in place, there is actually no possible legal way of implementing what the AMA calls managed care.”
But could non-members who attend Bupa GP clinics be influenced to join the fund?
“Private health funds have much more sophisticated direct marketing strategies for attracting member than relying on them turning up to a Bupa clinic,” said Dr David.
General practice has certainly not been a huge profit-making venture of late, so what is the upside for private health funds of becoming involved as a provider?
“A lot of the corporate general practice business models have been very innovative, and have been able to navigate in a system where it’s very, very difficult both for the providers of general practice and for the doctors themselves,” said Dr David.
“There has been the desire for a number of doctors to lead a more balanced life … and some of the corporates have been very innovative in the models that they’ve permitted GPs to operate under.”
The other big driver for the private funds is the money to be saved by treating patients before they get into the financial black hole of hospitalisations, surgeries and costly treatments.
“This is a gateway for funds into prevention,” said Dr David.
Caring for patients before conditions require hospitalisation ends up saving patients money, as well as saving health funds from paying out huge claims to hospitals and specialists.
Ultimately, said Dr David, the private funds saw themselves stepping into a breach in the system that government seems unwilling or unable to fill.
“Medicare was one of the best political decisions ever made,” she said.
“But the fee-for-service system has now lost its ability to cover benchmark costs. And that is with a constrained workforce.
“That is a very difficult problem to fix, because it’s inflationary. It puts the government in a very difficult position. But I think there is a role for some big practice payments to be made into general practice to assist them with more preventive work.
“And the health funds [are trying] to step into the breach.”