The Australian Competition and Consumer Commission will grant authorisation* to the Canberra After Hours Locum Medical Service (CALMS) to implement a capped fee structure in its provision of after hours primary medical care in the ACT. Authorisation is granted for a maximum of three years.
Under the new fee structure, the fees that CALMS doctors charge patients seeking after hours care cannot exceed a certain level.
"While the ACCC recognises that the capped fee structure has the potential to lead to anti-competitive pricing, with the maximum fee effectively becoming a benchmark, any scope for anti-competitive pricing in this situation is limited as doctors retain the discretion they previously had to charge fees below the cap or bulk bill where appropriate", ACCC Chairman, Mr Graeme Samuel, said today.
The ACCC considers that price agreements within rosters can potentially raise serious competition concerns. In the event that authorisation is sought for such arrangements, the ACCC will look to the extent to which any anti-competitive effects are constrained.
Constraining factors may include the nature of the price agreement itself (for example a fee cap rather than a fee floor), the nature of the service to which the price agreement relates, the geographic area within which the service is available, and the extent of competition between providers of the service.
Under CALMS' capped fee structure, potential anti-competitive detriment is constrained by the restricted scope of the arrangement, the fact that the arrangement involves a price cap rather than a price floor, and the limited nature of competition amongst providers of after hours care with or without the arrangement.
"Accordingly, the ACCC is satisfied that public benefit likely to flow from the capped fee structure outweighs potential anti-competitive detriment", Mr Samuel said.
More information regarding the application and a copy of the Final Determination are available by following the Authorising anti-competitive conduct and Authorisations links.