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By Dr Rosemary Kelly, Executive Officer, Victorian Psychologists Association and Dr Ruth Perkins MAPS, President, Victorian Psychologists Association

The introduction of the Medicare rebate for psychological treatment has increased the attraction of private practice to psychologists, which is exacerbating the existing shortage of clinical psychologists in the public sector and thereby diminishing the quality of care available to patients in Victorian public mental health settings. The public system is effectively competing with the attractions of private practice for clinical psychology services. It behoves the policy makers in government health departments and health services to make the public sector an attractive system in which psychologists want to work.

The introduction of the Medicare rebate for psychological

There is a shortage of clinical psychologists in Victoria, and in rural and regional areas it is often difficult to recruit clinical psychologists. In Victoria there is general - although not universal agreement - that, apart from neuropsychologists as required, only clinical psychologists should be employed in mental health services. This is certainly the policy position of the Victorian Government Department of Human Services (DHS, 2006), but one which is often breached by health services. DHS offers incentive packages worth up to $10,000 which health services are able to access when seeking to recruit clinical psychologists (and other health professionals) from interstate and overseas to vacancies in Victoria, particularly in regional, rural and outer metropolitan services (DHS, 2007). Items covered by the incentive packages include relocation costs, continuing professional development, and, in the first year of employment, professional indemnity insurance, membership of the APS, registration fees and private health insurance. Paradoxically, at the same time as Victorian health services are offering these inducements, interstate and overseas governments are mounting "increasingly aggressive" campaigns to attract Victorian trained allied health professionals, including psychologists (DHS, 2007).

Coupled with this workforce shortage, the introduction of Medicare rebates for psychological services has resulted in many clinical psychologists opting to reduce their hours in the public system in order to extend their private practices. The loss of experienced clinical psychologists from the public health system is having a number of adverse impacts including:

  • Reduction in the availability of clinical psychology services to clients with complex and ongoing needs
  • Loss of experienced student supervisors
  • Difficulty in obtaining supervised placements for Masters and Doctoral psychology students
  • Difficulty in obtaining supervision for provisionally registered psychologists, and for registered psychologists wanting to satisfy the requirements of the APS College of Clinical Psychologists
  • Difficulty in ensuring access to professional supervision for psychologists employed in the public sector
  • Difficulty in recruiting psychologists to new or vacant positions
  • Specialist services being put at risk
  • Multidisciplinary teams without psychologists

Advantages of employment in public mental

Public sector mental health offers a range of different settings, client groups and age-specific services, with the capacity for psychologists to specialise within a service or within particular client groups. The public sector offers many other professional advantages such as: opportunities for professional development through case conferences, seminars and conferences; networking with peers; the opportunity to supervise students, and undertake research and teaching; and the capacity to develop formal and informal links with university departments of psychology and academic psychologists.

Maintenance of the many professional advantages which accrue to psychologists who work in the public health sector is a factor in retaining psychologists. Many of the entitlements which psychologists are able to access have been obtained by psychologists working collectively through the Victorian Psychologists Association (VPA), a component association of the Health Services Union Victoria No. 4 Branch. Apart from the usual provisions in relation to paid annual and long service leave, personal leave and hours of work, the industrial agreements which apply to psychologists employed by public sector agencies include:

  • Career path with an incremental classification structure
  • Access to paid conference and professional development leave
  • Paid examination leave
  • Paid leave for postgraduate study
  • Access to 12 months unpaid career break.

In mental health services psychologists are often employed in generic case management positions, positions which may be advertised as being capable of being filled by a social worker, registered psychiatric nurse, speech therapist, occupational therapist or psychologist. This is problematic, as case management can mean that patients may not have access to the specialised services of a clinical psychologist. It also makes it difficult for psychologists to distinguish themselves from ‘allied health professionals' in the competition for resources and recognition that occurs in large, complex organisations.

Despite the difficulties and challenges, psychologists have been able to work collegiately to achieve and maintain their professional identity through instituting a number of measures such as professional supervision, regular psychology meetings, incorporation of research into their work, and establishing a culture of professional support.

Organisational and industrial contexts

With public health services funding based on outputs, health services are largely free to develop their own organisational structures for service delivery. This has resulted in different organisational models being adopted by different services in Victoria. For example, the Royal Children's Hospital has introduced an integrated mental health service which includes not only child and adolescent mental health services funded by the mental health branch of DHS, but also neuropsychology and other psychology services which are provided in acute health settings in the hospital. Southern Health has undergone an organisational restructure in which mental health has its own Executive Director, and in which psychologists working in acute and sub-acute health services are employed in separate directorates.

Restructuring is often driven as much by cost-cutting as by enhanced service delivery. One aspect of this drive has been the tendency for mental health services to undermine the career paths of psychologists by reducing the number of higher graded positions. This impacts on the availability of supervision, and undermines the attractiveness of working in the public sector.

For example, the industrial agreements applying to health services include the classification of Clinical Specialist Grade 4, which is distinguishable from a Grade 4 psychologist with managerial or administrative responsibilities. A Clinical Specialist Grade 4 is a psychologist with at least 10 years postgraduate experience required to exercise specialist skills, who may be required to perform a consultative role, and teach psychology undergraduate and/or postgraduate students and staff from other disciplines. Because employing services have the discretion to appoint to this classification it is rarely used, and the career path of clinical psychologists is being truncated.

Psychologists have to be vigilant to prevent the loss of higher graded positions. Many Grade 3 and Grade 4 positions have been preserved through the intervention of the VPA and its members. The undermining of career paths has been a factor in the decisions of a number of clinical psychologists to either resign from the public sector or reduce their hours.

Negotiations to increase the attraction and retention of clinical psychologists

The introduction of the Medicare rebate for psychologists has enhanced the status of clinical psychologists more than any amount of advocacy could have achieved at the workplace. DHS is aware that public mental health services will suffer if no action is taken to reverse the loss of psychologists to private practice.

In April 2008, the VPA completed negotiations for a new industrial agreement with the DHS and the health services to cover psychologists in mental health, as well as acute, subacute and community services. Apart from salary increases, the agreement provides for further negotiations to occur for an enhanced career path for psychologists to take effect no earlier than July 2009. In addition, it has been agreed that further discussions will occur with public health services, under the auspices of the DHS, with the objective of developing and agreeing to a model or models providing for private practice rights for psychologists employed in the public sector. This is a direct response to the impact of the introduction of the Medicare rebate for psychological treatment. Agreement has also been reached to establish a Mental Health Workforce Strategy  Committee, with representation from all Unions with members working in public mental health services, which will oversee the implementation of a workforce recruitment and sustainability strategy for all classifications of staff working in mental health.

The VPA and its members want to maintain the public sector as an attractive place to work; it is the training ground for provisionally registered psychologists and psychologists who are working towards membership of the APS Clinical College. It offers significant advantages in relation to professional development and peer support. The outcomes of the negotiations over the new industrial agreement will assist in this project. Once the VPA is able to reach agreement with the DHS and the public sector employers over an appropriate career path for psychologists and models of employment which allow psychologists rights to private practice, the drain of experienced clinical psychologists into private practice is likely to be reduced. The ultimate beneficiaries of this will be the clients of those services - the people with complex mental health conditions who need access to clinical psychology services and whose needs cannot be met under the Medicare system.

The authors can be contacted on rosemaryk@vicpsych.org.au and ruthp@iimetro.com.au.


Department of Human Services (2006). An Introduction to Victoria's Public Clinical Mental Health Services (www.health.vic.gov.au/mentalhealth/services/intro-mhservices.pdf). Victorian Government DHS: Melbourne, Victoria.

Department of Human Services Melbourne (2007). Guidelines for allied health professional incentive packages: Health careers for a healthy future (www.health.vic.gov.au/workforce/downloads/medical/health_careers_%20ahp_incentive_%20factsheet.pdf). VictorianGovernment DHS: Melbourne, Victoria.

Victorian Department of Human Services, Melbourne (2007). Better Skills, Better Care Stage 1 Report (www.health.vic.gov.au/workforce/downloads/bsbc_report_stage01_2007.pdf). Victorian Government DHS: Melbourne, Victoria.