Demand on South Australian hospital EDs, ramping is about to get worse from Monday with new payroll tax grab on GP clinics

A new state tax hit on GPs will flow on to embattled EDs from Monday, the Australian Medical Association warn – find out what it means for you.

The state government’s payroll tax grab on GP clinics from Monday will flow to increased demand at embattled hospital emergency departments, the Australian Medical Association warns.

The AMA predicts gap fees will rise by at least $10, while some clinics are expected to close on weekends as the tax, plus weekend penalty rates for administrative staff, makes it uneconomical to open.

The tax take was not included in the 2024-25 state budget and Treasury officials told The Advertiser they do not know how much it is expected to reap.

It is based on a NSW court ruling where contractor GPs who rent rooms and keep their consultation earnings rather than being paid a salary are deemed to be employees.

Requests for a comment from Health Minister Chris Picton on whether the tax would add to ED demand were referred to Treasurer Stephen Mullighan who said it was actually a tax cut and would not add pressure on EDs.

AMA state president Dr John Williams.

Adelaide GP and former AMA state president Dr Chris Moy.

He noted bulk billed consultations are exempt and there is a $1.5m wages threshold.

“Federal government data shows three quarters of all GP consultations are bulk billed, so the vast majority of GP consultations will benefit from this tax cut,” he said.

“This will ensure there is no further pressure on emergency departments.”

However AMA state president Dr John Williams — a rural GP — said patients who are not bulk billed can expect to pay at least $10 extra per consultation as the tax adds “hundreds of thousands of dollars to practice costs.”

“This reckless, shortsighted tax grab is a body blow for the many South Australians who are already struggling in the middle of a cost-of-living crisis,” he said.

RACGPs state chair Dr Sian Goodson. Picture: Matt Loxton

“We’re deeply concerned some people may delay seeking essential care because of this crippling tax. We know if people don’t receive primary care when they need it, they become sicker and end up seeking desperately needed treatment from emergency departments.

“This will exacerbate ambulance ramping. The system is already creaking under immense pressure and this patient tax risks making a bad situation much worse.

“We really don’t have a choice — it is increase the cost of consultations or close down.”

Royal Australian College of GPs state chair Dr Sian Goodson said the situation would have been far worse if a compromise had not been reached to exempt bulk billing — but with regulations yet to be published cautioned the “devil could be in the detail.”

“Some practices will need to increase their fees, but not as much as they would have without this agreement,” Dr Goodson said. “It will put pressure on EDs.”

Former AMA state president Dr Chris Moy says EDs are “going to need a longer ramp,” while an Australian General Practice Network statement says patients will pay more.

“This approach is unfair and damaging; especially given the cost of living crisis which is already causing people to delay necessary medical care,” it states.

“This tax will increase ramping, with more people avoiding GP visits due to higher costs, leading to increased ED visits.”