- On July 14, 2020
- July / August 2020
Post Job Keeper: What Happens Next?
Private practice owners face further uncertainty as the September deadline to pull back on temporary subsidies draws near.
AT THE TIME of writing, we are just over halfway along the JobKeeper timeline.
Introduced 30 March 2020, the temporary subsidy of $1,500 a fortnight per worker for eligible businesses, NFPs and the self employed has a deadline of 27 September 2020.
The JobKeeper subsidy was introduced to support businesses and retain jobs, and while the Government committed to the six-month program, it continues to make changes to JobKeeper in the context of its broader transition agenda.
The Prime Minister recently stated that the Government will re-examine ongoing fiscal supports in late July after reviewing the country’s economic circumstances and upon advice from Treasury.
While no further commitments have been made, there is considerable pressure from businesses to extend JobKeeper beyond September.
Practice viability post September must be considered within the wider context of Australia’s economic recovery. The Reserve Bank acknowledges the difficulty of being precise about the magnitude and timing of the easing of restrictions, an increase in business confidence, and a reduction in under and unemployment, and suggests three potential scenarios:
- Baseline – gradual recovery: most restrictions lifted by the end of the September quarter, more workers hired and normal working arrangements resumed.
- Faster Recovery: most containment measures phased out over coming months, based on existing policy support and a high degree of confidence in the ongoing management of health outcomes.
- Slower Recover: Many restrictions remain until closer to the end of 2020, with more unemployment and business suffering severe financial stress.
The faster recovery scenario assumes a robust health system to which practice viability will be central.
With patient attendance still below pre-COVID-19 levels and many practices utilising the JobKeeper subsidy and other Government support, business viability is likely to still be at risk if the measures currently in place were to be discontinued as currently proposed. The measures below are due to finish or be reviewed at the end of September 2020, at which time the shape of the recovery curve will undoubtably influence the Government’s decision-making:
- Temporary MBS telehealth items, introduced in March to help reduce the risk of community transmission of COVID-19 and provide protection for patients and healthcare providers, are scheduled to finish 30 September 2020. There is considerable advocacy for these temporary telehealth measures to be continued after the proposed expiry date, and the Government has indicated it will consider this if recommended by the Australian Health Protection Principal Committee (AHPPC).
- Government support for medical practices from April 2020 included the doubling of the bulk billing incentive for general practice, diagnostic imaging and pathology services and an expansion of the Practice Incentive Program (PIP). Temporary increases to incentive payments for general practices were implemented to provide support for bulk billed services and ensure patients kept access to essential face-to-face care. However, patient attendance at doctors’ surgeries has yet to return to pre COVID-19 levels. These measures are to be reviewed after 30 September 2020.
- From July to October 2020, for businesses that are still active, the Government will introduce additional payments to the Boosting Cash Flow for Employers initiative, which in April 2020 provided eligible businesses with up to $100,000 to assist their cash flow.
- The Coronavirus SME Guarantee Scheme provided a guarantee of 50% to small and medium enterprise (SME) lenders for new unsecured loans to be used for working capital. This is in place until 30 September 2020.
- The Government’s partnership agreement which integrated private hospitals with State and Territory health systems in the COVID-19 response is subject to ongoing review to ensure it remains appropriate.
- NSW Health was working towards Stage 2 of elective surgery restoration, to 75% by 30 June 2020, and the Government’s National Cabinet plan has a return of “…up to 100% normal surgical activity levels or as close to normal activity levels as is safely possible” at Stage 3.
- Given the need to generate sufficient income to maintain business viability, practices may need to consider increasing patient fees, in compliance with the Competition and Consumer Act 2010 (CCA) and the Australian Consumer Law (ACL). This decision must be balanced with the potential risk of further deterring patient attendance in some circumstances.
Step 3 of the Government’s 3 step plan for a COVIDSafe Australia is a “...commitment to reopening business and the community with minimal restrictions but underpinned by COVIDSafe ways of living.”
Implementation dates are State and Territory decisions, but the Government’s National Cabinet has reconfirmed the commitment for this framework to be completed in July 2020.
Staying informed on the current COVID-19 situation, keeping up to date with changes to Federal and NSW Government measures to support business during this period, and monitoring the financial position of your business will be critical at this time. Advice from professional services in accounting and finance and other sources of general business information may be useful, for example the Government’s business website on Coronavirus information and support for business and business continuity planning and CPA Australia’s Business Recovery from Covid-19: Tips for Small Business.
A COVIDSafe plan will be essential for practice viability to ensure health and safety obligations are met in your workplace. This includes assessing workplace risk in consultation with your employees, as described in detail by Safe Work Australia, and implementing physical distancing, workplace cleaning and hygiene practices, and flexible work arrangements to help minimise peak hour public transport. More information on this is available in the AMA (NSW) Workplace Relations Coming out of COVID-19 resources on the Coronavirus Information page of our website.
Some potentially emerging issues identified include significant mental health issues among some of the population, more government support for technology delivered services like telemedicine, an improved health stockpile, more preparedness for future pandemics, more connections across the health system, health fund changes, and better data collection and utilisation.
Contributed by Barbara Robinson-Tan
Workplace Relations Advisor, AMA (NSW)