How a Consultation Is Paid For

Key definitions

Rebate vs inflation: the widening gap

Using MBS item 23 (Level B, standard consult) as the anchor:

$37.05

Item 23 benefit, July 2014source

$43.90

Item 23 benefit, July 2025source

~11%

Real value decline

Rebate rose 18.5% while CPI rose 33.8%

[Rebate vs Inflation chart - to be implemented]

Bulk billing incentives

From 1 November 2025, all Medicare-eligible patients became eligible for bulk billing incentive items (previously targeted to children and concession card holders).

$43.90

Item 23 (Level B) benefitsource

$21.85

Item 75870 (BBI, MM1)source

BBPIP: the all-or-nothing incentive

The Bulk Billing Practice Incentive Program (BBPIP) offers a quarterly incentive of 12.5% of MBS revenue for practices that bulk bill all patients for all consultations. This improves viability, but the all-or-nothing design means a single gap-charged consultation can jeopardise the incentive for the entire practice.

The throughput equation

Gross revenue per hour at different consultation lengths

Bulk billed Item 23 + BBI (MM1, metropolitan). Does not include BBPIP.

Consult length	Patients/hr	Revenue/hr	Per minute
6 minutes(floor)	10	$657.50	$10.96
10 minutes	6	$394.50	$6.58
15 minutes	4	$263.00	$4.38
20 minutes(ceiling)	3	$197.25	$3.29

What does it cost to provide a consultation?

No single authoritative source publishes a definitive cost per consultation, but multiple data points allow a reasonable estimate.

$82

Average total fee chargedsource

For a standard 6-20 minute consultation (RACGP 2025)

$86

AMA recommended feesource

The AMA's recommended fee for an Item 23 consultation

~45%

Rebate covers this much of costssource

The Medicare rebate covers approximately 45% of the cost of running a practice

$39

Average gap feesource

What patients pay out-of-pocket when not bulk billed (RACGP 2025)

What the GP actually receives per bulk billed consultation

Bulk billed Item 23 + BBI (MM1). Assumes 30% practice cost share.

Component	Amount
Item 23 rebate	$43.90
BBI (item 75870, MM1)	$21.85
Gross per consultation	$65.75
Less practice costs (~30%)	-$19.73
GP receives (before tax)	$46.03

Does the payment model incentivise shorter appointments?

The concern is not theoretical. Three structural features of the current payment model create pressure toward shorter consultations:

Flat per-consultation payment. Item 23 pays the same $43.90 for 6 minutes as for 20 minutes. Adding the BBI and BBPIP does not change the shape of the incentive - it increases the flat amount but still pays per transaction, not per minute.
Adverse selection. GPs who spend longer with complex patients earn less per hour and attract a disproportionate share of the most complex, resource-intensive patients. Conscientious practitioners are financially penalised twice.source
The BBPIP amplifies the effect. The 12.5% loading applies to total MBS revenue, meaning it rewards higher billing volume. As Professor Louise Stone noted: "Medicare is designed to privilege quick medicine" and "the BBPIP makes quick medicine more lucrative."source