The health system is sick. It needs to be examined nationally

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Opinion

December 28, 2025 — 4.30pm

December 28, 2025 — 4.30pm

A small number of specialist doctors charge unethical and extreme fees, defined as a cost over three times the Medicare rebate for that service. They represent about 4 per cent of the profession, yet their behaviour is dominating the conversation about Medicare fees. Many patients will pay an out-of-pocket cost and some have crowdfunded for procedures, which is unacceptable in a wealthy nation.

Medicare is one of Australia’s greatest creations, created to provide universal coverage and eliminate a tiered healthcare system. Since 1975, Australians have expected healthcare that is high-quality, rapidly accessible and easily affordable. No single country has ever been able to provide all at once but the current debates around GP and specialist fees are leading us to believe that we can. Unaffordable care is a serious concern to us all with many people delaying medical care due to concerns around cost and demands urgent attention.

Australia’s health system needs to be looked at in depth, not in a piecemeal manner.Credit: Michael O’Sullivan

However, a push to regulate specialist fees is treating the symptoms, not the disease.

Transparency and ethical billing must be a part of the solution. But targeting the entire profession for the behaviour of outliers distracts from the real drivers of rising out-of-pocket costs.

When you see a doctor, a Medicare rebate is what the federal government contributes to the cost of that appointment or procedure. Over many years, rebates have failed to keep pace with inflation or the actual cost of providing care, or the costs of actually providing that care, a finding endorsed by the Grattan Institute. The AMA estimates that the gap between CPI and Medicare indexation is over 20 per cent over 20 years. In practical terms, Medicare covers far less of the true cost of care than it once did. With rising rents, wages and insurance still needed to be paid, the shortfall has largely been passed on to patients.

Accessing public hospital outpatient clinics has become increasingly difficult. These clinics are funded by the states, not the federal government and decades of underinvestment has left them over-stretched, under-resourced and unable to meet demand. Long waits have pushed many patients into the private system, not necessarily because they have no alternative.

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Meanwhile, Australia has repeatedly failed to plan its medical workforce. Predictable specialist shortages have gone unaddressed for years. Rural and regional areas face chronic undersupply while other regions experience mal-distributions. Highly trained doctors remain outside the public system due to planning failures, forcing them into private practice instead of helping to clear public waitlists. These are all serious policy failures, from decades of mismanagement that are much bigger drivers of healthcare spending.

Responsible spending in healthcare matters and reducing patients costs especially important. But while proposals such as Medicare billing rights or capping fees may sound reasonable, they risk making it even harder to access care. If Medicare becomes financially unsustainable for doctors, they may reduce the numbers of patients they see, relocate (interstate or overseas) or even opt out of Medicare altogether. This can create a two-tiered system which is exactly why Medicare was created in the first place. None of the current proposals address the underlying structural weaknesses that have built up over decades.

To fix the systems-level problems, we need to look for systems-level solutions. Rebuild public outpatient capacity, particularly for vulnerable patients who rely on it. Rebase Medicare rebates to reflect the actual cost of providing modern care. And strengthen and retain the specialist workforce so it can meet Australia’s needs.

Excessive fees must also be addressed, but punitive, blunt instruments are the wrong approach. Doctors must uphold ethical billing but this should be supported by independent, non-political fee oversight, not ministerial price-setting. Politicians have shown over many years that their ability to manage healthcare costs is lacking and this will likely be no different. Transparency should be the norm but we must also avoid punitive rules that punish and drive doctors out of the system.

If we want Australians to access specialist care when they need it, we need to fix the system that delivers that care with significant reforms, not just target the individuals inside of it. Out-of-pocket costs and extreme fees are genuine issues, but they sit inside a healthcare system that has not evolved, is stretched beyond capacity and continues to promise the impossible. If we don’t address the entire system and instead focus narrowly on fees, the system will collapse and patients will pay the price.

The danger isn’t a handful of doctors charging too much — it’s a health system that cannot survive another decade of pretending everything is fine.

Dr Nikki Stamp is a cardiothoracic surgeon, author and TV presenter.