After Jo was diagnosed with cancer, the medical bills started coming in – and she was paying thousands of dollars a year

First Jo O’Halloran gets life changing news she has inoperable cancer.

Then the bills started arriving.

One of her biggest expenses is an MRI scan, which the 56-year-old woman has to do every three months.

Ms O’Halloran has neuroendocrine cancer in her pancreas, and needs frequent scans to monitor if her hormone blocking treatment is working.

The cost recently rose to $850 per visit — totaling $3,500 a year — and there are no Medicare rebates and no private health coverage.

He will need an MRI for the rest of his life, and is worried about his future.

“If I got worse, what would the bill look like? Should I sell my house?” he says.

“The financial pressure and pressure is enormous.”

Diagnostic imaging is the single most expensive expense in the health system, outside of hospital care.

The average break-in cost for scans — which includes CT, ultrasound, and MRI — has increased from $84 to $120 over the decade.

And the situation is getting worse, the Australian Diagnostic Imaging Association (ADIA) has warned.

“Every day we see patients leaving because of cost,” said his spokesman Stephen Repse.

Decreased bulk billing means more spread payments

For the first time in history, bulk billing rates for diagnostic imaging have decreased.

Health department figures for hospitals and clinics show it fell to 77.9 percent in the March quarter since hitting a peak of 80.9 percent in 2020-21.

That figure is closer to 50 percent in clinics alone – that means more patients get the cost gap.

Dr Repse, a radiologist, said the industry was trying to bill susceptible patients en masse but it was getting difficult.

“It’s just unprofitable,” he said.

“If clinics don’t fill the gap, they will close their doors.”

The increase in gap payments follows a two-decade freeze on Medicare rebates for diagnostic imaging that was just lifted in 2020.

Since then, fees paid to clinics have only indexed annually by 0.9 percent and then 1.6 percent — well below inflation.

“Basically our industry has just been squeezed out gradually,” says Dr Repse.

“Rents are up, overhead costs are up, actual machine costs are up and staffing costs that are already very high are up.

“This money has to come from somewhere. And if the government doesn’t provide it, it has no choice but to fill the gap.”

Patients can save money if they shop

The problem is not evenly distributed across Australia, and the cost of the gap can vary widely even between suburbs within the same city.

The ABC has found large differences in the gap fees charged to patients for identical scans at different clinics, in a number of capital cities.

The gap fee quoted for a standard pregnancy morphology ultrasound ranges from $170 to $320, depending on the clinic.

Quotations for low back CT scans range from absolutely free, as they are billed in bulk, to $195.

For a basic ankle, MRI patients can pay between $300 and $350.

Even getting the same x-ray in the same radiology network can vary in price by up to $50, just by visiting a different location in the same city.

It’s possible to get free scans at public hospitals but it’s not an option for many patients, according to Meredith Cummins, chief executive of Neuroendocrine Cancer Australia.

Long waiting lists, travel distances and Medicare rules all make it difficult to get free scans at the hospital, he said.

Dr Repse says clinics set their prices based on their unique expenses, so price variations are not uncommon.

He said patients should shop around and their doctor’s referrals apply anywhere.

Like most people, Jo O’Halloran didn’t realize she could get scans for less money elsewhere.

“I didn’t know you could shop,” he said.

“Basically, I get a form and I find the one closest to me.”

Huge upfront costs for radiology

Adding further pressure on patients, ADIA said radiology clinics were unable to provide Medicare discounted rates onsite.

This means the patient must pay the full cost of the scan up front — sometimes up to $1,000 — and claim back the Medicare rebate later.

The federal government is due to pass a law in July that only allows gap fees to be charged but has yet to be submitted to parliament.

The federal health department said it was still working with Australian Services on changing the Medicare system to move to electronic payments.

Dr Repse said Ms O’Halloran’s particular situation was also unusual.

“Medicare doesn’t cover stomach cancer MRIs very well. And many of those cancers don’t even attract an MRI discount at all,” he said.

The federal department of health’s Medical Advisory Committee recently recommended a new abdominal MRI item for a rare genetic condition currently being considered by the government, and patient groups are hopeful.

For Jo O’Halloran, scans are just one of many expenses that come with everything from blood tests that are not covered by Medicare to parking at the hospital.

“There are all the costs that you don’t know up front,” he says.

“It just lands in your post box. No support at all.”

Federal Health Secretary Mark Butler said the federal government had given out the biggest increase in Medicare rebates in more than 30 years.

“The one-off increase we’ve put in the budget for the Medicare rebate that includes diagnostic imaging, is bigger in one year than any previous administration has delivered in six or seven years,” he said.

In addition, spokesman Mr Butler said the government is assisting patients with out-of-pocket costs through a number of Medicare safety nets, including the Extended Medicare Safety Net.

The emergency care clinic being rolled out nationwide will also include diagnostic imaging on a bulk bill, including x-rays, the spokesperson said.

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