High cost of catching the Medicare crooks

3 minute read

Does catching Medicare fraud cost the government more than it recovers?


The cost of recovering funds from dodgy Medicare claims by health practitioners appears to be trending higher than the money retrieved.

The Department of Health wrapped up 3,912 audits and reviews of practitioners in the year to June 2016, including 190 fraud investigations which it said were in the “most serious” category and did not reflect honest mistakes.

It sent 35 cases to the Commonwealth Director of Public Prosecutions and 80 to the in-house Professional Services Review (PSR).

The Medicare provider compliance program newly identified recoverable debts of $16.3 million in the year, after seeing a bulge of more than $60 million in 2014-15, according to the department’s annual report tabled this week.

However, it managed to recover debts of only $9.9 million, less than the $12 million a year earmarked for compliance measures over the next four years.

The sum included money paid back by GPs who had been warned earlier in “targeted letters” about claiming for patients who did not have a valid concession card on the date of their consultation but had kept up the practice.

Scrutiny in 2015-16 also focused on specialists’ MBS claims for referred consultations and assisted reproductive technology items, as well as pathology and diagnostic imaging services.

Some 80 doctors were referred to the PSR because of unusual claiming or prescribing patterns, including five who breached the so-called 80-20 rule.

Under the Health Insurance Act, GPs and other health practitioners who supply more than 80 services in 20 days in a single year must be reviewed by the PSR.

The Department of Health took over the role of monitoring Medicare compliance by healthcare providers from the Department of Human Services in November last year.

The program’s headline achievement in 2015-16 was the conviction, also in November, of a GP locum who was jailed for three years for fraudulently obtaining more than $850,000 in Medicare benefits.

A hotline set up in February received about 850 tips from members of the public of healthcare providers about potential non-compliance or fraud in its first five months, the report said.

The ostensibly recoverable amount was identified through audits, acknowledged by practitioners or calculated from penalties and determinations, it said.

The government set aside $48 million over four years in the May budget to enhance the Medicare compliance program and improve the low rates of debt recovery from health providers.

It projected the budget measure would yield savings of $66.2 million, which would be redirected into health funding.

In the preceding three years to June 2015, a DHS-run compliance regime invested $7.6 million in a crackdown aimed at alleged over-servicing by larger medical practices, defined as those with four practitioners or more.

It calculated savings of up to $71.5 million over the three years, almost entirely due to “behaviour change” among doctors in response to a strategy of reviewing all practitioners at practices where over-servicing was suspected.

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