GST Red Tape Leads to Aussie health crisis

Parliamentary processes are leaving the elderly and individuals with chronic health conditions short changed as a result of GST being applied to the cost of seeing accredited exercise physiologists nationwide. 

All Medicare allied health services are exempt from the Goods and Services Tax (GST), but exercise physiologists remain the only allied health service where the government applies the tax to the cost of a consultation. 

This charge nets the government less than $20 million a year nationwide, but the wider implications of this financial windfall, are damaging. 

Exercise physiologists work with patients suffering from illnesses such as cancer, diabetes and mental health issues, yet many patients are forced to stop care because of the extra cost. 

Under Medicare, only five consultations are considered “GST exempt” (if referred by a General Practitioner) with the sixth visit onward having the 10 per cent charge applied. Patients without a GP referral, including someone referred by a medical specialist, are charged extra from the first consultation (an added $7-$10 per session).

Spokesperson for Exercise & Sports Science Australia (ESSA), David Beard says he brought the issue to Prime Minister Scott Morrison and other politicians but most have simply deferred to the outdated GST policy. 

“Exercise is a medicine – it is increasingly being prescribed to patients by GPs and specialists. Studies show it helps fight diseases like cancer and diabetes, but it seems if it’s not in the form of a pill, politicians aren’t interested,” Mr Beard said. 

“Every day I manage chronically ill people who need urgent help with exercise plans to improve their health and manage their conditions,” he said.

“Some of them stop seeing me after their five Medicare subsidised sessions because they can’t afford it, yet this is just when we start to see improvements.”

“These people go on to become a burden on the health system, often needing expensive drugs or surgery, which they could have avoided if they’d continued to receive our treatment.”

“The government doesn’t want to lose GST revenue but is willing to pay more for care for these people once they are in real crisis – it just doesn’t make sense.”

The exercise physiology profession was less than a decade old when GST was brought in and despite services being recognised by Medicare back in 2006, the GST issue was not rectified. 

Impacts of GST on Exercise Physiologist – 
Financial Burden - Adds 10 per cent charge to each consultation, unlike most other health services. Average cost is $70-$100 for an hour consultation with exercise physiologist (thus an added $7-$10 cost per session for patient) 
Medical System - Patients not continuing care further impact the health system, through hospitalisation, surgery and straining other services. 
Patient Confusion - Creates confusion for patients given added charges unlike other commonly used services, such as podiatry and physiotherapy.  
Business Impact – Many practitioners absorb the charge instead of passing on to patient. The GST also creates significant accountancy costs for businesses. 

“All the politicians we’ve lobbied say our case has merit, but I bet if we ask the Federal Minister for Health or the Prime Minister, they couldn’t tell us what the process is to remove this GST,” said Mr Beard.

“The government hides behind this process and uses it as a way of not making a decision, meanwhile, patients are suffering. Key decision makers are not prepared to say it should be fixed.” 

“Treasury officials that make these decisions appear more concerned with financial outcomes, but why are they making decisions that influence health policy?”

“More and more exercise is being recommended as part of either the management of, or prevention for, almost every chronic health condition.”  

Exercise Physiology is recognised under Medicare, Private Health Insurance and Veterans Affairs and is the only allied health profession within Medicare subject to the GST. 

ESSA want the see the GST legislation updated, to include exercise physiology as a listed health service, removing the GST cost to patients that desperately need the treatment in managing life threatening illnesses. 

About Exercise Physiology - Exercise physiologists specialise in the delivery of exercise for the prevention and management of chronic diseases and injuries, achieving behavioural change and restoring optimal physical function, health or wellness.  Physical activity and exercise assist in the management of a plethora of chronic health conditions including obesity, hypertension and diabetes.

Overall, exercise interventions delivered by accredited exercise physiologists are estimated to be efficacious and highly cost effective in the Australian health care setting.   

Deloitte Access Economics identified a high return on investment for accredited exercise physiology services in treating people with chronic conditions, notably pre-diabetes and diabetes, mental illness and congestive heart failure.   

Media Contact: 
Adam Santarossa
0414 679 124 
[email protected]