GP Practices and Pathology Rents

The war between GP practices and Pathology Collection Centres is back in the spotlight as the Federal Government looks to identify practices who allegedly charge inflated rent to Pathology Collection Centres according to a recent article by the Australian Doctor

With reports the Department of Health have provided funding to the Integrity Division to review and enforce compliance, the first action by the Government will likely be the engagement of a data analytics company to review rental payments that fall outside the normal rates (more than 20% above market value).  GP practices deemed to be charging inflated rent will receive warning letters, with failure to respond resulting in fines potentially being applied.

The provisions in relation to the rental for pathology have been in the Health Insurance Act for some time now however to date no one has been prosecuted.  Practice owners have argued for a long time that the rents charged are at market rates and result from the economics of supply and demand.  Meanwhile, pathology companies have been arguing for a reduction in rental payments and the to and fro continues.

This continues to place focus on how GP practices can ensure they remain profitable.  We encourage GP practice owners to understand the details of the agreements with pathology providers and to ‘work’ within the guidelines.  Should you feel that your practice is at risk for the above please contact your William Buck advisor to discuss your options.

To read further information on how to survive rent control for pathology centres, click here.