Changes to Australia’s Reimbursement System: Potential Effects on Medical Device Companies

An Australian government task force has begun work to recommend changes to the country’s healthcare funding processes that if implemented could impact how some medical device providers are reimbursed.

Australia medical device and IVD reimbursement changesThe task force has published a consultation paper after being tasked with reviewing Australia’s Medicare Benefits Schedule (MBS) with the aim of applying evidence-based assessments across a broader swath of expenditures made under the country’s Medicare national health system. The country’s current MBS has not been updated or amended since 1984.

“Seventy per cent of MBS items have not been changed since their introduction, while medical practice has advanced in response to new evidence and new technologies,” states the task force in its report introduction.

The MBS comprises out-of-hospital medical services from private practitioners and private hospitals; service types found on the MBS include consultative and procedural or therapeutic services and also diagnostic services such as x-rays, blood tests and ultrasounds.

Task force clinical and working group committees will review current MBS reimbursement practices in terms of safety, clinical and cost effectiveness, frequency of use and similar criteria. Elimination of funding for “low-value or inappropriate health services” will be a key goal of the task force’s effort.

According to Dr. Mike Skalsky, Managing Director at Emergo Australia, the outcome of the task force’s review as well as how and whether the Australian government adopts its recommendations may have a substantial impact on medical device companies active in the Australian market.

“A number of medical and diagnostic procedures that the task force finds not to have adequate clinical evidence may no longer be funded, or have more specific indications,” Skalsky explains. “This may impact devices currently supplied for these procedures, while on the other hand new and evidence-supported procedures could be introduced.

“Those new procedures could enhance the utilization of more recently developed medical devices and technologies that presently have no MBS procedure codes,” says Skalsky.

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