Cosmetic surgeons: Impacts of economic downturn amid increased regulation and spiralling claims
The Australian cosmetic surgery industry has faced a turbulent 18 months characterised by heightened litigation, multiple class actions being brought against practitioners and practices, supply issues, increased costs for medical indemnity insurance and significant changes to regulation. This follows the independent review commissioned by the Medical Board and Australian Health Practitioner Regulation Agency (AHPRA) in November 2021 of patient safety issues in the cosmetic surgery industry, including how to strengthen regulation of practitioners.
AHPRA has since implemented reforms for ‘Medical Practitioners that Perform Cosmetic Surgery and Procedures’ which came into effect from 1st July 2023. The aim of the APHRA reforms is to enhance patient safety, improve standards of care, and regulate the cosmetic surgery industry more effectively.
The updates to regulation include higher standards, tougher advertising requirements and the introduction of a new endorsement on registration.
Reforms
The reforms apply to doctors practising in two areas:
- Cosmetic surgery (involves cutting beneath the skin - including breast augmentation, facelifts and liposuction).
- Non-surgical cosmetic procedures (which may pierce the skin but don’t cut beneath it, such as injectables, thread lifts and laser treatments).
Registered Medical Practitioners who perform cosmetic surgery should implement the following mandated guidelines from 1st July 2023*:
All cosmetic surgery consultations must be preceded by a referral from a General Practitioner (GP). This new measure adds a layer of protection for patients, who will in future be able to discuss their motivation for cosmetic surgery with their GP who has the best knowledge of their medical history and can share this with the doctor being referred to.
All patients seeking cosmetic surgery must have two pre-operative consultations, including one of these consults in person. This includes the first consultation being with the medical practitioner who will be performing the surgery. These measures are designed to help patients evaluate the suitability of the cosmetic surgeon and make a more informed decision about their procedure. It also allows for thorough discussion of the risks, benefits and expectations involved.
Practitioners must implement more rigorous assessments of patients’ mental health and screen for body dysmorphia. By integrating these assessments into the consultation process, the aim is to ensure that cosmetic procedures are pursued with a clear understanding of the patient’s psychological readiness and overall suitability for the surgery.
Enhanced requirements for obtaining informed consent from patients before performing cosmetic surgery have been imposed. These enhanced requirements aim to ensure that patients are making well informed decisions about cosmetic surgery, with the clear understanding of what the procedure entails and its potential implications.
Cosmetic surgery must only be performed by medical practitioners with the appropriate knowledge, training, and experience to perform surgery. This new measure gives patients confidence that their cosmetic surgery will be performed by a well trained and experienced practitioner.
All cosmetic surgeries must be carried out in a facility that is accredited by the Australian Commission on Safety and Quality (ACSQHC). The facility must be adequately staffed and equipped to handle complications and emergencies. This new measure aims to enhance patient confidence and safety in cosmetic surgery procedures.
All practitioners must regularly participate in continuing professional development, that is relevant to their scope of practice. In addition, practitioners must review their performance and measure surgical outcomes. By adhering to these CPD requirements, practitioners will be better equipped to deliver safe, effective, and up-to-date cosmetic surgical care.
Stricter regulations have been imposed on how cosmetic surgery practices can advertise their services. The regulations aim to promote transparency and protect patients from unrealistic expectations of the outcome of cosmetic surgical procedures. By implementing these stricter advertising rules, the goal is to ensure that potential patients receive clear and appropriate information, enabling them to make informed decisions about cosmetic surgery.
Financial and economic challenges
Implementation of the reforms has proved challenging in the sector, largely due to the following factors:
In response to the cost-of-living crisis, many patients are postponing or cancelling cosmetic procedures due to financial constraints. This in turn is leading to decreased revenue for surgeons.
The additional costs of compliance, such as updating facilities, investing in new technology, and additional training for staff, are increasing operational costs.
The rise of “no win no fee” compensation lawyers targeting unsatisfied cosmetic surgery patients, coupled with the AHPRA’s new Cosmetic Surgery Hotline, has led to a higher incidence of complaints and potential legal actions against surgeons. Statistics show an increase in formal complaints and restrictions on practitioners, reflecting heightened scrutiny.
The following statistics were reported by AHPRA in the first 12 months following the rollout of the Cosmetic Surgery Hotline:
- 428 calls including from patients concerned about their treatment, from other doctors who have had addressed poor outcomes, and from consumers who are keen to make informed choices.
- 179 formal complaints or notifications against medical practitioners performing cosmetic surgery.
- As a result of the above complaints, 14 doctors are no longer practicing cosmetic surgery or have significant restrictions in place as an interim measure while investigations continue.
- 12 doctors had restrictions placed on their registration after investigations were carried out.
Implications on medical indemnity insurance
The surge in medical malpractice claims and AHPRA complaints, coupled with high-profile class actions against several well known practitioners, has adversely affected the insurance landscape. Several Medical Defence Organisations (MDOs) have either withdrawn from offering coverage or imposed restrictive terms on members’ policies, leading to higher premiums. Surgeons are experiencing substantial increases in insurance premiums, with costs rising to the equivalent of 15 to 30 per cent of their annual billing. This escalation further exacerbates financial pressures on cosmetic surgeons.
Looking forward: Recommended areas of focus
The evolving regulatory landscape and increased public scrutiny on the cosmetic surgery sector presents both challenges and opportunities for surgeons. Bellrock recommends the following areas of focus to assist in risk management and improved insurance pricing and availability:
- Compliance with reforms: Embrace the new regulatory requirements and integrate them into daily practice. Review and update internal patient protocols to ensure compliance is embedded in all aspects of daily practice and patient interactions.
- Prioritise patient safety: Promote a culture of proactive and continuous improvement by focusing on education, awareness and robust procedures around informed consent and mental health assessments. This also includes maintaining a compassionate and empathetic dialogue with patients at each step of treatment.
- Record keeping: Meticulous documentation is key to defending against claims and complaints. Ensure thorough and contemporaneous file notes are recorded for all patients. This includes thorough informed consent documentation and documentation regarding the assessment of a patient’s physical and mental suitability for certain treatments.
- Demonstrate proactive risk management: By demonstrating a consistent commitment to best practice and proactive risk management, surgeons can improve their standing with medical indemnity insurers which should in turn positively benefit insurance premiums and coverage.
Bellrock strongly recommends seeking tailored advice from an experienced risk advisor with specific expertise in the medical sector. Your advisor should understand the unique risk profile of cosmetic surgeons and be aware of current trends impacting claims performance and insurance coverage. A thorough review of your medical indemnity policy, should include the identification of any coverage restrictions that may have been imposed and assistance in understanding any “gaps” in cover and how they may affect your practice.
By setting a proactive course of risk management, cosmetic surgeons can better position themselves to navigate the evolving regulatory and economic landscape.
For more information on Bellrock’s service offering for cosmetic surgeons see our guide here.
*Practitioners should refer to AHPRA guidelines for registered medical practitioners for full details. Practitioners can stay informed of updates to AHPRA codes and guidelines impacting the cosmetic surgery sector via the AHPRA cosmetic surgery hub here.
