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Funding environments

Medicare and private fees

Two funding sources at opposite ends of the same practice. One is priced in Canberra, the other is priced by you.

The stream most practices already have and do not think about

Almost every Allied Health practice carries some Medicare and some private work. For a practice weighted toward NDIS or Aged Care, it is frequently the only part of the revenue where the price is not set by somebody else, which makes it the natural hedge and the part most worth deliberate attention.

How much this matters depends on how many payers your discipline carries. Physiotherapy and podiatry sit across six each, which is what makes them resilient to any single decision, and it is payer spread rather than management quality that produces that. Disciplines carrying fewer payers feel every change harder, and for them the Medicare and private mix is doing more work than it looks.

What sits inside this stream is chronic disease items, Better Access and private fees. The gap fee is the lever, and most practices under-use it.

What gets brought to me

The gap fee has not moved in years

The Medicare rebate is a contribution toward your fee and you set the rest of it. Most practices set that number once and never revisit it, which is a real margin decision made by default.

Chronic disease work is losing money and nobody has checked

Bulk billed chronic disease sessions frequently sit below the fully loaded cost of the clinician delivering them. That is a legitimate choice and it should be a choice.

The service mix grew rather than got designed

Medicare, private, NDIS and private health extras all running through the same diary with different rates, different documentation and no view of which one is subsidising the others.

Diversification is the plan and nobody has costed it

Moving from a single funded stream into Medicare and private is the right instinct. It is also a different referral engine, a different marketing problem and a different cash flow shape.

What I am usually asked for

  • Gap fee setting, and the margin case for moving it
  • Service mix analysis across Medicare, private, NDIS and extras
  • Whether a chronic disease caseload clears its own cost
  • Diversification away from a single funded stream
  • GP referral strategy, and why a GP would send to you rather than the incumbent
  • Getting found by clients directly, where no third party holds the gate

Advice from someone who has run the business

300+

Clinicians at the provider I co-founded

$15m+

Annual revenue at that business

130+

Allied Health providers I have worked with

100%

Independent advice, no clinical services

Wondering whether the mix is right?

The answer is usually in the numbers rather than in the clinical work, and it takes about an hour to find. A discovery call will tell you whether it is worth doing.