‘Dear Dr’ let­ter is all it takes to cut costs


A se­cret trial has de­liv­ered a 19.5 per cent re­duc­tion in ur­gent af­ter-hours Medi­care billing — sav­ing the fed­eral gov­ern­ment about $12 mil­lion — sim­ply by send­ing care­fully worded let­ters to the doc­tors mak­ing the high­est num­ber of claims.

The Week­end Aus­tralian used Free­dom of In­for­ma­tion laws to re­veal the ex­traor­di­nary re­sults of the first tri­als of be­havioural eco­nomics, or nudge the­ory, in the Department of Health.

A minute to for­mer department sec­re­tary Martin Bowles — ini­tially with­held un­der FOI but ob­tained this week on ap­peal — shows the se­cret trial was run­ning for a year. “The cost of af­ter-hours ser­vices by health pro­fes­sion­als who pro­vide care at night, on week­ends and pub­lic hol­i­days has grown by 140 per cent be­tween 2005-06 and 2014-15,” the doc­u­ment states.

“A po­ten­tial driver of this growth is in­cor­rect claim­ing by health pro­fes­sion­als or those com­pa­nies that em­ploy them. There may be a fi­nan­cial in­cen­tive to claim rou­tine items as higher pay­ing ‘ur­gent’ items.”

There have long been con­cerns over the growth in ur­gent af­ter-hours billing and home visit doc­tor ser­vices more gen­er­ally. While some stake­hold­ers wanted Medi­care re­stric­tions, the Be­havioural Eco­nomics and Re­search Team de­cided to in­stead try writ­ing to the doc­tors in­volved.

The top 1200 doc­tors who claimed ur­gent af­ter-hours items were iden­ti­fied and sent let­ters to “vol­un­tar­ily ac­knowl­edge in­cor­rect claim­ing of ur­gent items and to en­cour­age a shift in their claim­ing be­hav­iour away from ur­gent items to stan­dard items”.

As part of the trial, BERT wrote dif­fer­ent let­ters to three dif­fer­ent groups to de­ter­mine the best ap­proach. The word­ing was redacted from the FOI doc­u­ments but the let­ters to the con­trol group achieved a 14 per cent re­duc­tion in claim­ing, the let­ters to the “so­cial norms” group achieved a 24 per cent re­duc­tion, and the let­ters to the “firm mes­sag­ing” group achieved a 21 per cent re­duc­tion. The minute states that, separately, 18 health pro­fes­sion­als con­fessed to $1.08m in in­cor­rect claim­ing.

“Six months af­ter the first let­ter was sent, all health pro­fes­sion­als who re­ceived the let­ter had sig­nif­i­cantly re­duced their claim­ing of ur­gent af­ter-hours items by 19.5 per cent,” the minute states. “This equates to an es­ti­mated $11.7m in be­havioural sav­ings (or $9750 per let­ter sent).”

The minute, signed by Mr Bowles, has been stamped with a smi­ley face and the words “Nice work, thanks!”

The trial came be­fore the bud­get ramped up com­pli­ance ef­forts in an­tic­i­pa­tion of be­ing able to gen­er­ate an ex­tra $103.8m over four years.

Medi­care funded more than 3.4 mil­lion home vis­its in 2015-16, at a cost of more than $341m to tax­pay­ers. Of that amount, af­ter­hours ser­vices took up $28.9m but that was dwarfed by ur­gent af­ter­hours ser­vices ($245m).

A re­view of the Medi­care Ben­e­fits Sched­ule has rec­om­mended the gov­ern­ment tighten rules on ur­gent af­ter-hours items and al­low billing only by “a GP who nor­mally works dur­ing the day (and) is re­called to work for man­age­ment of a pa­tient who needs ... ur­gent as­sess­ment”.

‘All health pro­fes­sion­als who re­ceived the let­ter had sig­nif­i­cantly re­duced their claim­ing’ MINUTE TO EX-DEPARTMENT SEC­RE­TARY MARTIN BOWLES

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