Billing strategies to help you claim consumables in line with MBS rules

The costs of running a healthcare practice and providing services to your patients are rising. This includes the consumables you use daily, from masks to bandages, vaccines and wound dressings.

The MBS rule on consumables, in relation to billing procedures, is GN.7.17. It states:

“If a practitioner bulk bills for a service the practitioner undertakes to accept the relevant Medicare benefit as full payment for the service. Additional charges for that service cannot be raised. This includes but is not limited to: 

• any consumables that would be reasonably necessary to perform the service, including bandages and/or dressings;
• record keeping fees;
• a booking fee to be paid before each service, or;
• an annual administration or registration fee.”

The GN.7.17 note adds:

“… where a service is not bulk billed, a practitioner may privately raise an additional charge against a patient, such as for a consumable. An additional charge can also be raised where a practitioner does not bulk bill a patient but instead charges a fee that is equal to the rebate for the Medicare service. For example, where a general practitioner provides a professional service to which item 23 relates the practitioner could, in place of bulk billing the patient, charge the rebate for the service and then also raise an additional charge (such as for a consumable).”

Essentially, it depends on your billing style (bulk, private or both), as to whether you can pass on a cost for consumables to a patient, or claim it via Medicare. And while the practitioner decides how to bill a patient at the time of the consult, according to the type of service, the decision to charge for consumables can be made jointly between the practitioner and practice.

It’s important to be clear on your billing style and how your practice might charge patients for consumables. Here are some strategies to consider.

Document and display your fee schedule and billing so patients and staff stay informed

Documenting all your practice’s processes is crucial. This includes the policies and procedures around your consult fees, billing options and any consumables out-of-pocket fees. Using an online practice management platform such as PracticeHub makes this easy. You can create and store your practice operations manual online, so it’s easy to access. Staff can also receive alerts about policy updates, via direct messaging and email, to ensure everyone is always up to date, keeping your practice compliant.

Fee and billing-related policies to include in your operations manual may be:

• a statement affirming that individual doctors are responsible for ensuring the accuracy of their billings.
• how/when/who at your practice will notify patients of any extra costs – to avoid any bill shock or potential for patient complaints
• a list of your most commonly billed items
• steps on how to correctly process billings in your practice management system
• a link to the MBS web page, so you can always access the current rules.

Communication is an important policy consideration. When patients hear the term ‘bulk billing’, they expect not to pay for a service, or consumables provided in a consult. So, if you do intend to bulk bill for a provided service, and add an out-of-pocket charge to the patient, you need clear-cut policies around this and to communicate them effectively so patients are informed.

Consider displaying your full list or services and fee schedule, with any additional charges, like consumables, on your website and in reception at your practice. Indicate which services may be bulk billed and which are privately billed or out-of-pocket.

Keep your team informed on your consumables billing processes

Your admin team also need to understand the billing style for different types of consults, to process it correctly, so it adheres to the MBS rules and to avoid incorrect billing. 

In your policies and procedures, you could include the steps for processing different billing scenarios, such as how to process an out-of-pocket charge for a vaccination versus a wound dressing.

Know your Shared Debt Recovery responsibilities 

The Shared Debt Recovery Scheme was introduced in 2019 to recover debts in instances where Medicare billing was delegated to non-practitioners, which resulted in incorrect billing.

The scheme allows for a debt to be split between a practitioner and the practice entity. The table below outlines the principles of the Shared Debt Recovery Scheme to ensure compliance with Medicare billing. And this article has more helpful insights into how the scheme works.

PracticeHub includes a specific Shared Debt Recovery policy template, written by practice management experts, which you can customise to suit your practice. Its Resources section includes links to related online reference sites and FAQs, so it’s easier for your team to stay across the processes, and for your practice to stay compliant.

In this policy, as with all policy templates in PracticeHub, you have the capacity to require your team to electronically sign off that they’ve read and understood a policy and any updates. This gives you peace of mind that you and your team are running a high-quality practice.

The information in this article, has been shared in our recent webinar, Consumables and the MBS: Optimising patient care, by Ami Assigal, Director of Practice Partners. Practice Partners consultancy can advise on the set up of medical practices and can provide specific advice on claiming consumables and the MBS. Take a look at their website for further details.

To make running your practice even easier, PracticeHub has recently partnered with Team Medical Supplies to streamline your consumables ordering. Find out how it works here.