Eleven Years of Two Tiers

The Two-Tier Medicare Rebate System for Psychologists

Discussion of the two-tier system frequently confines itself to the financial disadvantage it can cause for registered psychologists who are not clinically endorsed and for additional out of pocket expenses for the general public.  Some other very important consequences of this pernicious system are listed below.

  1. Reduction of Client Access, as more GPs refer to clinical psychologists, more locally available, skilled and experienced psychologists are unavailable to clients.

The pie graph above shows the national registration percentages for psychologists in Australia in the year 2017.  The overwhelming majority of registered psychologists (58%) are termed Generalist.  This group of psychologists includes many who are highly trained, very experienced, expert practitioners.  Psychologists within this group may have Masters degrees, PhDs, Doctorates.  They may have gained registration via the 4 year or 5 year university degree followed by very stringent requirements of an either 2 or 1 year post graduate supervised practice.  Many of these psychologists have been practicing in excess of 10 years.  They have extensive experience across a range of client types and needs and they have been completing Continuing Professional Development training requirements throughout each year of their practice.  The knowledge and broad skill base of these psychologists is a wonderful resource for prospective consumers.

Another group “Endorsed Non-Clinical” are psychologists who have obtained an area of practice endorsement in an area other than clinical psychology. Most of these psychologists have Masters or Doctoral Degrees and have completed an additional one to two-year registrar program to gain area of practice endorsement. Aside from this their demographics are very similar to the Generalist group.

Both Generalist and Endorsed Non-Clinical psychologists are becoming less available to consumers.  This situation is partly an outcome of a strategic campaign by a small factional group of clinical psychologists who aim to discredit the abilities of all other psychologists who treat mental illness within Australia. We now witness systemic change in which clinical psychologists are preferred by referring bodies.

This aggressive defamatory campaign is summed up most eloquently by the president of a breakaway group Dr Judy Hyde (see footnote) by suggesting that “the Australian population” is “served by the most poorly trained psychologists in the Western world”.

While the ideas promoted by this break-away group are false, misleading and do not align in any way with scientific evidence of best practice, they are unfortunately gaining quite a lot of traction. Importantly, while there is no evidence to support the defamatory claims of this small factional group, research commissioned by the Australian Government confirms the international standing of Australian Psychologists from all training pathways and backgrounds confirming the quality of their treatment across mild, moderate and severe cases of mental illness.

An overview of one predominant research project on this specific issue can be found here.

  1. Potential for Inappropriate Service Delivery, as clinical psychologists intrude into areas such as educational psychology, counselling psychology or forensic psychology previously delivered by psychologists better qualified in these areas;
  2. Loss of Opportunity, as more agencies and organisations which contract for services advertise for clinical psychologists, registered psychologists find their employment opportunities dwindling;
  3. Depletion of University Courses, as undergraduates can see more opportunities and financial reward in becoming clinical psychologists, some universities discontinue courses;
  4. Narrowing the Range of Psychology, as specialities other that clinical are gradually extinguished;

In relation to points 3, 4 & 5 the graph above shows the number of psychology post graduate programs accredited by the Australian Psychology Accreditation Council (APAC) in the 2017 calendar year.  This graph depicts the unmistakeable effects of the two-tier Medicare rebate system on psychology nation-wide.  The fabricated story that clinical psychologists are superior combined with it’s involvement in instigating and championing a two-tier Medicare rebate system is now decimating the diversity and ultimately the effectiveness of psychology Australia wide.  Market forces, scrambling for the financial benefits of the higher rebate, are delivering a one type fits all, version of psychology for all consumers of psychological services in Australia.  Additionally, all the other highly valued and much needed areas of psychology are in free fall heading toward extinction.

With regard to the APS, there are three things for all psychologists to note from the above graph.

(a)      In the APS Constitution, Objects 1. (a) it is stated:

“To advance the scientific study and professional practice of psychology and enhance the contribution of psychology to the promotion of the public welfare by encouraging the development of all branches of psychology”

We ask the question, “How does the APS’s involvement in instigating a two-tier Medicare rebate system, followed by doing nothing to advocate for changing it for 11 years, deliver to the Constitutional Object stated above?”

(b)      In the APS Constitution, Objects 1. (k) it is stated:

“To consider and advise on any question of psychological policy referred to it for consideration of any group or member of the society or any other body”

We ask, on behalf of many members of the APS who have contacted the Board in relation to the two-tier Medicare system and its specific effects, “What has been your consideration and what have you advised given that our contacts have not been replied to, and many of us have waited years without receiving a reply?”

(c)      In the APS Constitution, Objects 1. (l) it is stated:

“To identify any arrangements with any Government, or authority, supreme, municipal, local or otherwise, that may seem conducive to the Society’s objects or any of them; and to obtain from any such Government or authority any rights, privileges and concessions which the Society may think it desirable to obtain”

We ask the question on behalf of all Generalist psychologists and all Endorsed Non-Clinical psychologists who have raised their concerns regarding the two-tier system, “Isn’t it desirable to the Objects of our constitution to advocate for the removal of the two-tier system and place all registered psychologists on a single tier to thereby facilitate and promote the overall diversity of our profession and arrest the devastation of all non-clinical areas of psychology?”

  1. Disillusion, Disenchantment, and Discouragement, as registered psychologists experience the undermining of their professional credibility and status;
  2. Loss of APS membership, as some psychologists seek more effective representation and recognition in alternative organisations.

It is not just about money!  It is time for the recognition that the two-tier system has created a significant challenge to the practise of psychology in Australia.

Regulatory Authority

The regulatory authority in Australia is the Psychology Board of Australia (PsyBA).  PsyBA is a National Board whose functions are supported by the Australian Health Practitioner Regulation Agency (AHPRA).

The current 11 board members of PsyBA comprise of seven psychology health practitioners and four community members who are appointed for three years.  There are also regional boards:

  • The NSW Board of the Psychology Board of Australia
  • The Queensland Board of the Psychology Board of Australia
  • The Northern Territory/South Australia/ Western Australia Board of the Psychology Board of Australia
  • The ACT/Victoria/Tasmania Board of the Psychology Board of Australia

The AHPRA register of practitioners reveals that clinical psychologists dominate the membership of the PsyBA Board at both a national and regional level.  So, similar to the APS Board, the PsyBA Boards are very lopsided – stacked with clinical representation.

Highly trained skilled psychologists, e.g. Forensic Psychologists, Counselling Psychologists, and other psychologists registered to practice in Australia have written to the Health Minister regarding their concerns about the two-tier Medicare rebate scheme. The response they received is as follows:

“The government is aware there are several endorsed areas of practice recognised by the Psychology Board of Australia (PsyBA), including clinical psychology, and that each area represents a different advanced set of knowledge and skills.  In recognition of this, the Government has determined that psychologists who wish to provide Medicare rebateable Psychological Therapy services under the Better Access initiative, which are at the higher MBS schedule fee level, must be endorsed by the PsyBA to practice in clinical psychology”.

There is an obvious internal disconnect within the above statement.  That disconnect is between “each area represents a different advanced set of knowledge and skills” and the conclusion “must be endorsed by the PsyBA to practice in clinical psychology” … thereby conferring eligibility for the higher rebate to only one advanced area.  Firstly the conclusion is not based upon any scientific evidence but there is scientific evidence that rebuts the statement.

Secondly, unlike specialities in medicine, the notion of clinical practice in psychology is not unique to clinical psychologists.  Psychologists who have gained registration from many different training pathways are engaged in clinical practice every day in Australia, treating people across a very broad range of conditions and levels of severity.  The skills to diagnose, treat mental illness therapeutically, and produce effective outcomes are not unique to one advanced area of psychology.  Once again, this is highlighted by the scientific evidence.

Furthermore, the Government’s assertion through PsyBA that clinical psychologists have “advanced levels of knowledge and skills” remains unsubstantiated by any empirical evidence.  There will be some ‘content’ knowledge differences across the different training pathways but the essential therapeutic skills which produce the outcomes are the same.  We have been informed by the PsyBA that the board is very concerned that clinical masters programs have proliferated in universities at the expense of important areas like forensic, health, counselling and educational and developmental psychology.

What Are The Dollar Costs?

Although, as mentioned earlier, it is not just about money, the dollar cost of the two-tier Medicare rebate system cannot be ignored.

The graph above shows the number of Medicare rebated sessions (Appointments) claimed by both Clinical and Generalist Psychologists in the 2016/2017 financial year.  Appointments are standard i.e. 50+ minute sessions.  Relevant Medicare items are 80010 (Clinical) and 80110 (Generalist).

There were:

  • 2,092,967 Clinical appointments and,
  • 2,493,291 Generalist appointments.

The graph above shows the cost to the Australian taxpayer of the same appointments in the 2016/2017 financial year.

2,092,967 Clinical appointments cost:

$260,574,391.50 and,

2,493,291 Generalist appointments cost;


Two other ways of considering the above data are:

Firstly, if Generalist psychologists had completed the sessions allocated to Clinical psychologists the saving to Australian taxpayers would have been,


The $83,090,789.90 differential is depicted in the graph below.

and Secondly …

Clinical psychologists have accounted for approximately 46% of money spent on service provision while making up only 28% of all providers and earning approximately 32% more per session than psychologists providing the same outcomes across mild, moderate and severe mental illness on the lower tier.

The scientific research evidence tells us that outcomes for consumers are equivalent whether they are treated by Clinical or by Generalist psychologists.

Considering all of the above data about cost of services and also how psychology education and practice is being affected by the two-tier Medicare rebate system we raise some questions.

These questions are for major stakeholders, especially decision makers, and in particular our Federal Government.

Before presenting our questions we would like to acknowledge that our Federal Government often takes it advice from major players in the profession – Peak Bodies.  The Peak body in the psychology profession in Australia is the Australian Psychological Society (APS).  In the lead up to the introduction of psychologists being admitted to the Medicare Register in 2006 the APS advocated to the Government that only clinical psychologists be admitted to the Register.  We have presented that advice here.

We suggest that the Government was given incorrect advice about the superiority of clinical psychologists for treating individuals with mental ill health and that this advice influenced Government policy.

Questions to our Government

  1. Was there value in taxing Australians an additional $83,090,789.90 in 2016/2017 to pay for the top tier services even though consumers receive equivalent outcomes from psychologists in either tier?
  2. Now that we have made you aware of the devastation being visited upon the psychology profession in Australia by the two-tier Medicare rebate system are you prepared to change this system?
  3. Now that we have made you aware that a majority of consumers are out of pocket by $40.00 per consultation (the difference between the Clinical and the Generalist Medicare rebate), and given the equivalence of treatment outcomes, what actions are you prepared to take to adjust this inequity?

All of the issues and inequities described above are a result of the distortion of market forces, via empirically unsupported ideas regarding the alleged superiority of clinical psychologists.

We suggest, with respect, that the implementation of a single tier system is the most effective way to remedy a now alarming snowballing of clinical psychology and an ever quickening process of extinction of the great diversity of all other forms of psychology in Australia.  Psychology in Australia is now in a divided, conflicted and confused circumstance.  When all psychologists registered to practice in Australia are on a single tier Medicare rebate, market forces will quickly adjust all of the above issues.  Subsequently the overall effectiveness and equity of skilled psychological services in Australia will return and the way forward to even greater value for our society from the discipline of psychology will become visible.
Hyde, J. 2017 [May], Australian Clinical Psychologist Newsletter: Presidents Address. Vol 3(1) Article 002.

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