Physios warned over alleged price-fixing bid

By Susie Nordqvist

Physiomed director David Murray was told off by the Society of Physiotherapists for deciding not to implement a part charge. Photo / Supplied
Physiomed director David Murray was told off by the Society of Physiotherapists for deciding not to implement a part charge. Photo / Supplied

The New Zealand Society of Physiotherapists is under fire from the Commerce Commission over claims of anti-competitive behaviour.

The industry body has been warned by the competition regulator after it sent a letter to one of its members accusing it of undercutting other physiotherapists by not introducing patient part-charges.

State health insurer ACC announced last year it was cutting funding to physiotherapists by one-third, but said clinics could charge patients a part-charge of about $20 per visit, to make up for any shortfall.

The society says the new laws have had a big impact on the industry with fewer people getting treatment and physiotherapists leaving the profession as a result.

Physiomed, which has clinics in Wellington, Christchurch, Oamaru and Dunedin, decided not to charge a co-payment and absorb the cost itself.

The decision prompted a rush of complaints from members to the society.

The society responded by writing a letter to Physiomed last year expressing its "disappointment" at the decision.

"The profession as a whole will suffer if we do not value the services we offer and charge accordingly," the letter says.

"We should not be trying to undercut other physiotherapy practices by aggressively advertising our fee structure or 'free physiotherapy'."

It is a breach of the Commerce Act to try and fix the price of goods or services to lessen competition.

New Zealand Society of Physiotherapists executive director Karen McLeay told the Commerce Commission she "had no intention of following up" on the letter and had not checked to see if Physiomed was continuing to offer free consultations.

"The commission accepts her word on this point, and have not found evidence to suggest that any follow-up or monitoring was intended or carried out."

"Consequently the commission is of the view that the letter falls short of an attempt at enforcing the NZSP recommendation, but only just," the commission says in a letter to the society dated March 31.

The letter was not made public at the time, but was released to nzherald.co.nz under the Official Information Act.

Physiomed director David Murray said he was disappointed at the way society handled the matter.

"I think the CEO who signed the letter definitely overstepped her boundaries."

"It's blatantly none of her business - we are a limited liability company and we can manage that change however we choose," he said.

Physiomed estimated it would lose between 30 and 50 per cent of its business if it introduced the part-charge.

Physiotherapy New Zealand president Gill Stotter said the letter to Physiomed was not an attempt at price fixing and the society was surprised at the commission's decision to investigate.

"We have always emphasised that whether or not practices charge a co-payment and if so, how much, is a personal business decision, and the letter to Physiomed does state that."

However on rereading the letter the society acknowledged "that the rest of the letter does not make this position clear," Stotter said.

The commission has recommended the society clarify to its members that it is up to individuals to decide whether they charge a co-payment.

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