STEVE LEEDER. A welcome review of the Medicare Benefits Schedule

Jun 30, 2017

In 2015 Sussan Ley, then the Minister for Health, established a review of the schedule of fees for medical benefits. The review of the schedule’s 5700 items, involving a rigorous evidence-based process, is now around half way through. When completed it will provide an opportunity for more cost-effective health care and a saving of public revenue.

Medicare, introduced by the Hawke Labor government in 1984, remains the major instrument of federal government funding for public health services in Australia. Its three major functions include payment for the provision of general and specialist medical services in the community, subsidies for pharmaceuticals and a component for public hospitals.

The Medicare levy covers a fraction of the total cost of these services but, despite its small contribution, reminds us that health care is not free, and that we all pay. The levy also speaks of us as a society, that we have acted decisively to provide health care to all our citizens, regardless of their ability to pay. Medicare expresses our social solidarity, our care for others in distress and our commitment to a fair go.

It would be incredible if Medicare, once delivered, did not need regular renovation. Thus in 2015, the then federal minister of health, Sussan Ley, established a review of the schedule of fees for medical services that Medicare covers. This was intended to build on the Medicare Benefits Schedule (MBS) Quality Framework introduced in 2009.

Some services on the original list, which ran to 900 pages, had been superseded by new technologies. Others that had been shown not to confer a benefit have remained on the list. New items of care have been added over the years, so the list has grown to 5700 items

There has been increasing attention paid to evidence and its use in medical care over the past 30 years, based on accumulating research and data systems. This means that we are now in a strong position to judge which services work and should be publicly funded, and which services have no evidence showing that they work and therefore should not attract tax dollars. Clinical practice guidelines have multiplied, many of which are based on a synthesis of available evidence, and these have proved their worth on review.

Although adjustments are always necessary for the individual patient, the experience and wisdom accumulated in these guidelines are rich resources for determining which services should be funded and which should not. Professor Bruce Robinson, a senior endocrinologist, chair of the National Health and Medical Research Council and dean of the Sydney Medical School, was appointed to chair the review of the MBS. The review was tasked with providing an interim report, published late in 2016. McKinsey & Company, a consultancy, were commissioned to assist the review.

Robinson’s approach has been unusually consultative. He began by establishing working groups of doctors from different specialties (about 400 doctors so far), supported by consumer representatives, to go through the MBS, assessing each item’s current validity and cost. The rules of engagement require discussion in each working group to concentrate on published evidence and to use professional judgement in determining what a fair fee may be for each item.

Robinson says that the review is now about half complete and he anticipates that the final report will be submitted to the minister, now Greg Hunt, by mid 2018. The minister has expressed continued commitment to the review, including funding for its completion and, more importantly, for a thorough regular review of the Schedule in future.

By using clinical reference groups, resistance to resolutions relating to the review is likely to be diluted, although it would be surprising if some professional groups who stand to lose out as a result do not attempt to retain the largesse they have enjoyed.

But the work of the review has been done quietly. Perhaps the biggest battles are to be joined. It is heartening, though, that that the political statements about the review have not sought to promote this as a way of saving money, but instead speak of using our health care money to our best advantage. This will mean no longer funding services currently on the MBS that don’t work and using the money saved to do more that carries a health advantage.


Stephen Leeder is an emeritus professor of public health and community medicine at the University of Sydney. He is currently director, Research and Education Network, Western Sydney Local Health District and Editor-in-Chief of the International Journal of Epidemiology.

Statement: Bruce Robinson is a colleague and friend of Stephen Leeder

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