That 7:30 Report

In mid October the ABC 7:30 Report ran an article suggesting very high levels of  “leakage” from Medicare. The ABC news site article of 17 October states:

Doctors are abusing the $28 billion Medicare system, at times putting patients at risk, billing dead people and falsifying patient records, all to boost profits.

A joint investigation by ABC’s 7.30 program, The Sydney Morning Herald and The Age has uncovered flaws in Medicare’s systems that make it easy to rort and almost impossible to detect fraud, incorrect payments and errors.

The leakage is estimated to represent nearly 30 per cent of Medicare’s annual budget, or about $8 billion a year.

Unsurprisingly the reaction from GPs was one of outrage and denial.

It is worth noting that the 30% value is markedly different from the  ANAO audit report No 17 of 2020-2021 Managing Health Provider Compliance which uses a total scheme value of $36.6B  (MBS, PBS, PIP & CDBS) and estimates non-compliance at between 1 – 6% ($366M – $2,196M) across four different studies conducted from 2016-19 ( Table 2.1). Clearly a very different value from the $8B estimate.

Since that time a number of statements have been made suggesting that the estimates from the news articles and the evidence of informed investigations do not coincide and that there is no evidence for “leakage” on the scale suggested.

The most recent of these was reported in an AMA Media Release as being made by the Department of Health and Aged Care Secretary, Professor Brendan Murphy to in response to questions from Senator Anne Ruston at Senate Estimates where  Dr Murphy  is quoted as saying said the media claims had not been “backed by any evidence that we’ve seen that the issue is that large” –  AMA Media Release 11 November 2022

Criticism of PSR & Medicare Auditing

In a subsequent article of 24 October the ABC again in association with the SMH and the AGE  went on to question the level of investigation by the PSR and its independence from the AMA.

The watchdog responsible for policing Medicare investigates just 0.07 per cent of health professionals each year, is chronically understaffed and underfunded, and is led by bureaucrats with strong links to the powerful Australian Medical Association (AMA), a joint investigation has found.

The AMA – a union that represents about a third of the country’s doctors – also holds an extraordinary veto over whom the federal government wants to run the regulator, known as the Professional Services Review (PSR).

The ANAO report No 17 explains the approach used in investigating non-compliance and the use of the PSR noting that it is intended to deal only with the about 1% of cases listed as Fraud, Inappropriate Practice and Sustained non-compliance -Fig 2.2 Health Provider Compliance Model (Page 21)



Daniel Reevers Inside Story article Faux Scandal (1/11/22) reviews both ABC articles and discusses the issues associated with investigation when faced with large amounts of data:
Investigation requires major human resources. The Medicare regulator, the Professional Services Review, investigates about one hundred practitioners per year, or 0.07 per cent of Australia’s 150,000 health practitioners. Yet Medicare sends out thousands of letters, placing the onus of proof on practitioners to justify their billing practices or face losing their practice or even their careers.
In other words, much of Medicare’s enforcement activity is little better than robodebt: sending letters with scary consequences based on statistical signals.


In the meantime all of this has distracted from the major issue facing Primary Health Care in Australia – Continued chronic under-funding leading to reduced patient access due shortages of GPs and  Practices moving to mixed and Private billing to remain viable.

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