Law reforms introduced from 1 July 2018 have given Medicare stronger
debt recovery powers. The legislation also provides for fairer approaches to compliance,
by apportioning responsibility for overpayments between both doctors and their employers
or contractors, including public hospitals.
Minister for Health, Greg Hunt said the legislation aims to
deal with the “very, very small number of outliers” who don’t comply, at the
same time acknowledging “the outstanding degree of integrity” among the medical
workforce when the Act was being reviewed by Parliament.
Recovering overpayment debts
Doctors with a debt to the Commonwealth arising from Medicare
compliance activities will be encouraged to enter into a repayment plan within
90 days. Where this doesn’t occur and the debt is not contested, Medicare has
two new options for recovery:
- Offset: Medicare can retain up to 20% of the benefits from bulk-billed claims that
would otherwise be paid to the provider and apply those funds towards the debt.
- Garnishee: To avoid a disincentive to bulk-bill, Medicare will have the power to withhold
part of the income of a doctor from non-bulk billed sources, including their
salary, from a state health service.
Medicare also has a new power to require the production of
documents and information related to the financial affairs of doctors with a
a shared responsibility
From 1 July 2018, the Professional Services Review Committees
are empowered to make findings of inappropriate practice against persons or
officers of body corporates who employ “or otherwise engage” doctors. This
includes practice owners and officers of corporate practices. The consequences of a finding for a person
found guilty of inappropriate practice in that way includes the repayment of
the whole or part of the Medicare benefits paid for a service, notwithstanding
the service was rendered by an ‘associated person’ (such as the providing
doctor) and the benefit was paid to an ‘associated person’.
These amendments potentially correct the existing unfairness
that leaves an individual provider fully exposed to a finding and being ordered
to repay benefits, regardless of the culpability of their employer or contractor.
Also, from 1 July 2019, a Shared Debt Recovery Scheme will apply
to the recovery of debts arising from making a false or misleading statement,
e.g. a claim for benefit. The Scheme will allow Medicare to make a
determination about the proportional responsibility of the primary debtor (the
providing practitioner) and a secondary debtor. The secondary debtor may be a
person or body corporate such as a hospital, corporation or practice.
Medicare can make a shared debt determination where it is
reasonably believed to be appropriate to do so, having regard to:
- Whether the relationship of the secondary debtor
with the primary debtor was such that the secondary debtor could have
controlled or influenced the circumstances that led to the making of the false
or misleading statement.
- Whether the secondary debtor directly or
indirectly obtained a financial benefit from the making of the false or
- Any other factors in all of the circumstances of
the case make it fair and reasonable for the determination to be made.
What should you do?
It is in the interests of both individual providers and
those who employ or otherwise engage them to cooperate, to ensure all documents
related to claims for Medicare benefits are complete and accurate.
Although the reforms potentially improve the fairness of
compliance outcomes, they will not excuse complacency.
The reforms do not diminish the provider’s primary
responsibility for the services they provide. Providers should continue to
ensure that they are knowledgeable about item descriptors and explanatory notes
for Medicare Benefits Schedule services they provide. Providers should always
determine what items are billed in their name and take every care to ensure
documents submitted to Medicare under their provider number are accurate and
Practices, hospitals and others with administrative responsibility
for the submission of documents to Medicare should ensure documents are not
false or misleading. The accuracy of
submissions to Medicare should be checked with the provider of the service, if
Those with a responsibility for the direction of more junior
providers such as supervisors, practice principals and senior administrators
should take care to ensure their directions to junior providers are
If you have concerns about an incorrect Medicare claim or
are unsure about your billing responsibilities, contact Avant’s Medico-legal
Advisory Service via email at firstname.lastname@example.org or call 1800 128 268 for
medico-legal advice, 24/7 in emergencies.
The Department of Health
website has many useful guides in its ‘For
Health Professionals’ section about claiming from Medicare.
Avant’s article ‘To bill
or not to bill?’ also looks at common questions around Medicare claims for
private patients in public hospitals and our feature ‘Somebody’s watching:
Increased scrutiny’ in the latest
issue of Connect magazine
discusses the increase in Medicare compliance investigations in more