Introducing a GP copayment in Australia: Who would carry the cost burden?

Abstract

Recent policy changes designed to contain unsustainable health expenditure growth imply that many more Australians may soon be charged a copayment to consult a GP. We explore the distributional consequences associated with a range of hypothetical GP copayment scenarios using nationally-representative Australian survey data. For each scenario, we estimate the cost burden that individuals and households across the income distribution would need to absorb to maintain their current GP service utilisation. Even when concessional patients are charged a third or a quarter of the non-concessional copayment rate, the average estimated cost burden in the lowest income quartile is typically between three and six times that of the highest, and the average cost burden for women is significantly higher than for men within every income quartile. These disparities are intensified for those with a chronic illness. We conclude that the widespread implementation of GP copayments would disproportionately burden lower-income families, who experience higher rates of chronic illness, higher demand for GP services, and lower capacity to absorb price increases. The regressive nature of GP copayments is reduced when concessional and child patients are exempted entirely, highlighting the importance of supporting GPs—particularly in disadvantaged areas—to maintain bulk-billing arrangements for vulnerable patient groups.