By Jacob Shteyman in Canberra

Leaders have been urged to reach for the stick to bring price-gouging doctors into line as soaring specialist fees drive more Australians away from care.

Fees for specialist medical practitioners are rising far faster than inflation, with the most expensive five per cent of psychiatrists charging a median out-of-pocket fee of $669 for an initial consultation, independent think tank the Grattan Institute found in a report.

More than 800,000 Australians are being forced to skip or delay seeking specialist care each year due to the cost.

Providing more government funding would not deter some specialists from taking advantage, Grattan’s health program director Peter Breadon said.

Instead, any overcharging doctors should have their Medicare subsidies revoked, the report said.

“This small minority of doctors should be forced to repay the value of their Medicare funding at the end of each year,” Mr Breadon said.

“Reforms to build up public clinics, help GPs provide more care, and train more specialists are desperately needed.

“But that will take years to work. In the meantime, fees keep rising, and every year more Australians are paying extreme fees.”

The policy brief, released on Monday, builds on previous Grattan work that found some specialists charge more than three times the Medicare fee schedule.

Mr Breadon and co-authors Mia Jessurun and Thomas Shortridge found slow indexation of Medicare rebates was not behind the rapid run-up in specialist fees.

Rebates have failed to keep up with inflation in recent years, declining by $9 in real terms since 2012.

But fees have risen by $37 in real terms during that time, making up for the decline more than four times over.

If the erosion in value of the rebate was to blame, a similar surge in fees would be evident for other Medicare services like GP visits. But they have largely kept pace with inflation.

Cost is not the culprit either.

In the past 16 years, the median gross profit of a specialist business grew by 73 per cent, outpacing profit growth in GP, legal, accounting and construction businesses, the Grattan Institute found.

The Australian Medical Association said affordability was a much broader issue than specialist fees alone.

“Governments need to address the full range of factors affecting the affordability of care for patients, including Medicare rebates, public outpatient capacity, specialist workforce shortages and private health insurance arrangements,” president Michael Bonning said.

The AMA called for a major increase in specialist training positions to prevent a projected shortfall of specialist doctors in coming decades.

Health Minister Mark Butler said all options were on the table to rein in climbing specialist fees.

Patients would have more transparency over specialist fees when they are listed on the Medical Costs Finder website from 2027, he said.

A parliamentary committee led by Labor MP and pediatrician Mike Freelander is examining other ways to bring down specialist fees, including whether GPs can play a greater role in specialist care.

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