Informed Financial Consent: what every doctor should know about medico‑legal risk

Informed financial consent (IFC) is more than a courtesy or administrative task - it is a critical safeguard against medico‑legal risk. At the heart of IFC is transparency. When patients clearly understand the financial aspects of their care, they are less likely to feel misled or distressed if they receive unexpected bills and may be less likely to escalate concerns into formal complaints. Conversely, when IFC is incomplete, delayed or inconsistent, it can undermine trust and amplify a patient’s emotional response if their expectations of care are not met. 

A strong IFC process therefore reduces medico‑legal exposure in the same way other fundamentals such as good documentation and a clear clinical consent process do. 

IFC is embedded in the Medical Board of Australia’s Good Medical Practice code of conduct, and requires doctors to provide accurate, timely and comprehensible information about: 

• Consultation and procedure fees 
• Medicare rebates 
• Likely out‑of‑pocket expenses 
• Other providers involved in the patient’s care who may also charge fees. 

Providing cost information proactively supports ethical, patient‑centred care and helps mitigate medico-legal risk. Transparent discussions about fees set clear expectations, reduce misunderstandings and may lower the emotional temperature if an adverse event occurs. 

Clear IFC conversations demonstrate professionalism and fairness, helping to build trust and resolve issues early. Where trust exists, patients are often more understanding when something goes wrong. In contrast, confusion or dissatisfaction about cost may intensify distress and increase the likelihood of complaints.  

Clear and consistent cost discussions and processes may significantly reduce that risk. 

A robust IFC process is consistent, proactive and tailored to the complexity of the treatment. It also provides transparency at every step. 

1. Start early to reduce risk 

IFC should occur before the appointment or procedure. Early, clear conversations reduce the likelihood of a patient experiencing ‘bill shock’, which is a recognised trigger for complaints. Reinforcing financial consent when making an appointment - including through online platforms, on arrival, during clinical discussions as well as when plans change, helps ensure that patients are appropriately informed.  

2. Treat IFC as a process - not a form 

Like clinical consent, financial consent is continuous, collaborative and patient‑centred. Providing verbal explanations supported by written materials helps promote transparency and strengthens your medico‑legal position by demonstrating that you have taken steps to ensure the patient understood the information. Written information available online or in printed materials also supports consistency across your well-trained practice team - another important risk‑management measure. 

3. Match the format to the complexity 

Verbal IFC for simple, fixed-fee situations is appropriate when costs are predictable. This should still be supported by clear, accessible written information available elsewhere (e.g. website, brochures). 

Written or electronic IFC is recommended for procedures with multiple components. Providing printed, emailed or app‑based information helps ensure clarity and reduces medico‑legal exposure where costs may vary. 

Formal, tailored written quotes should be utilised for complex treatment or procedures. A documented, itemised estimate is one of the most effective tools for preventing complaints. It demonstrates transparency and ensures the patient is aware of potential variations and additional costs. The patient should review and accept the quote, with a copy retained in the clinical record. 

4. Clarify third‑party fees to prevent disputes 

Misunderstandings about other providers’ fees - such as anaesthesia, radiology, pathology, allied health or hospital charges - are a frequent source of complaints. Even when you are not responsible for these costs, medico‑legal risk increases if the patient thinks you ‘didn’t tell them’. So, these should be raised with the patient as potential or related costs, with information about where to get more information. 

If a patient experiences a complication, disappointment, or adverse event, emotions can run high. In such circumstances, surprise costs can increase the risk of a complaint. A well‑documented IFC process: 

• shows you genuinely attempted to support informed decision‑making 
• demonstrates transparency and fairness 
• builds trust, even in difficult circumstances 
• provides strong evidence if a claim or complaint is lodged 
• can prevent escalation altogether 

To minimise the risk of complaints to you and your practice, it’s important to take a consistent and proactive approach to informed financial consent. This includes ensuring all staff are trained and confident in discussing fees, regularly reviewing and updating any written or online cost information, and checking that messaging is aligned across every communication channel.  

Reinforcing cost information at multiple touchpoints can also help prevent misunderstandings, as can documenting IFC in a way that reflects the complexity of the care being provided. Above all, adopting a practice‑wide commitment to transparency helps build trust, reduces the likelihood of disputes, and supports a smoother, more positive experience for your patients. Consistency and transparency remain your strongest assets in preventing complaints and maintaining patient confidence.

Informed financial consent is more than a regulatory obligation - it should be a natural and integral part of medico‑legal risk management. Transparent, consistent IFC protects patients from unexpected costs, supports ethical care, and significantly reduces the likelihood of a complaint or claim. By embedding strong IFC practices in your daily workflows, you strengthen trust, improve patient experience and safeguard your professional reputation.