"The Australian Competition and Consumer Commission has granted interim authorisation* to general practitioners operating within specified business structures to agree on the fees they charge patients", ACCC Chairman, Professor Allan Fels, said today. "This will give certainty to GPs while the ACCC considers the merits of the application for authorisation lodged by the Royal College of General Practitioners.
"The interim authorisation allows GPs, working in the same general practice, to agree on fees where the general practice is:
- incorporated as an Australian company and the GPs are engaged by the company as independent contractors or employees
- a unit trust where the GPs are engaged by the corporate trustee as independent contractors or employees
- a partnership of two or more GPs, regardless of whether any of the partners are incorporated
- an associateship where two or more GPs are co-located and via a written agreement, agree that they will treat any patient of the practice and will maintain a common reception, common fee collection, common bank account, common trading name, common medical records and common accreditation.
"The authorisation also provides immunity to locums engaged by any of the general practices listed above as employees or independent contractors, to set fees with other GPs in the practice or to be directed by other GPs in the practice on what patients are to be charged.
"The interim authorisation provides protection to GPs until the ACCC issues a draft determination on this matter. At that point, the need for further interim authorisation will be considered.
"The College lodged an application for authorisation for GPs to agree on fees under these four arrangements on 31 August 2001 on behalf of all GPs across Australia. It expects to provide a supporting submission to the ACCC in late October 2001.
"The application follows extensive consultation between the ACCC, GPs and their representative organisations regarding the draft version of the General Practitioners Guide to the Trade Practices Act. It is expected that the final version of the Guide will be issued in the next few months.
"While ACCC has granted interim authorisation to associateships structured as set out under (d) above, it recognises that this type of business model does raise some competition concerns. This model will therefore be closely examined by the ACCC as part of its consideration of the merits of the College's application.
"The ACCC has been dealing with issues concerning GPs since 1974 where they are incorporated, or where they practice in the Australian Capital Territory or the Northern Territory, and since 1995 for all GPs. During this period, it has not pursued any issues concerning situations where GPs post the same fees at the same practice. Nevertheless some concerns about these situations have been aired in recent debate and an authorisation would appear to cover these concerns".
*Authorisation provides immunity from court action, and is granted where the ACCC is satisfied that the conduct delivers offsetting public benefits when weighed against any anti-competitive effects. Applications are considered on a case by case basis. The onus is on the applicant to demonstrate that there is public benefit arising from the conduct and that the public benefit outweighs any public detriment. Authorisation, once granted, does not compel parties to participate in the proposed arrangements.