Why we’ve chosen not to participate in preferred provider schemes

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At South Perth Physiotherapy, we have made the decision to no longer participate in any health insurer preferred provider schemes.

It’s important to note that this does not affect our ability to look after anyone, nor does it affect our ability to accept any of the health insurances. We are still accredited and registered to treat everyone with all health insurance, and you still receive a health insurance rebate no matter which insurance you have.

 

What is a preferred provider agreement?

Some private health funds have established ‘Preferred Provider’ or ‘Members’ Choice’ programs, however the true meaning of these terms is commonly misconstrued. A “preferred provider” has not been selected by the insurer due to increased quality or experience. Any practice or provider can nominate themselves to join these programs with the health funds. In most situations they just have to agree to some non-negotiable terms including agreeing to a maximum fee charged to their clients (which may be less than the usual fees charged) in exchange for the insurer usually paying a higher rebate per session. There is no screening process that assesses providers based on experience, qualifications, or quality of care.

The terms ‘Preferred Provider’ and ‘Members’ Choice’ may imply that you’ll receive a higher standard of treatment, however this is not the case, and, in fact, it could actually be the opposite. Some physiotherapists may provide shorter consultations in order to be able to offer the fees stipulated by the health fund. However shorter consultations may not be effective at efficiently assisting and addressing your needs.

 

But I get a higher rebate with a preferred provider.

While this is true, the limits you have for physiotherapy (and anything else) does not change. With higher rebates per session you may just use up your total limit much faster.

Say for example you have a $400 annual limit for physiotherapy. At a preferred provider you may have received (for example) $50 rebate per session. This would mean you would completely use up your annual physiotherapy limit in 8 sessions (which, depending on your problems, may not meet your requirements for the whole year).

Without the preferred provider agreement, you may get a lower rebate (say $40) but this would last for 10 sessions.

In the end, however, you would still receive $400 rebate towards your physiotherapy care for the whole year, regardless of how much per session is covered. There is no different cost to the insurer at all.

 

Why have we chosen not to participate?

At South Perth Physiotherapy, we have always provided longer consult times and aim to have experienced and highly trained clinicians to be able to provide the best care for our clients.

While we have participated in these schemes previously, we no longer believe we can commit to charging a maximum fee which can be 20-40% lower than our usual fees (depending on appointment duration) without this negatively affecting our ability to provide quality services to our clients.  We also don’t feel it is equitable to have different fees for different clients solely based on which health insurer they choose. Finally, preferred provider schemes generally do not allow for any variation in length or type of consultation with the fee schedule, so this would penalise clients who require more time or who have complex or widespread problems.

 

What is the Australian Physiotherapy Association’s (APA) position on preferred provider schemes?

The APA is concerned that contractual arrangements between Australian physiotherapy clinics and private health insurers create an imbalance of power. The APA is of the opinion that:

  • the current competition laws do not serve the interests of consumers of privately insured ancillary health services as preferred provider schemes discourage competition and restrict consumer choice of health services.
  • Section 46 of the Competition and Consumer Act 2010 (CCA) prohibits a corporation with a substantial degree of power in a market from taking advantage of that power for one or more prohibited anti-competitive purposes. The APA submits that preferred provider schemes encourage a misuse of market power, as demonstrated by BUPA’s market saturation in South Australia.
  • existing unfair and unconscionable conduct provisions of the CCA should be strengthened to provide a more efficient and equitable basis upon which the forces of competition can operate; and
  • the experience of small businesses is that most small physiotherapy practices are reluctant to engage the Australian Competition and Consumer Commission (ACCC) for fear of damaging their relationship with private health funds.

Our physiotherapy team has made the choice as a group to no longer participate in these schemes. If you have any questions or queries, we are always happy to discuss these.

The last of our current preferred provider agreements will finalilse on 31st May 2023. If you are affected by this please feel to contact us to discuss.

 

The South Perth Physiotherapy team

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