In the 2008-2009 Federal Budget the Australian Government announced its plan to refine and enhance the MBS audit process undertaken by Medicare Australia (Medicare), namely the Increased MBS Compliance Audits (the Initiative).
Primarily, the Initiative seeks to:
- Increase the number of Medicare audits;
- Compel providers who render and claim for Medicare services to produce evidence to verify the claim when audited; and
- Introduce administrative sanctions for Medicare providers who claim for services incorrectly.
Following a lengthy consultative process the draft Exposure Bill, originally released on 9 April 2009, was amended because of concerns raised regarding privacy issues associated with patient clinical information being accessed by Medicare employees.
The Health Insurance Amendment (Compliance) Bill 2009 (the Bill) will amend the Health Insurance Act 1973 (Cth) (the Act) to give effect to the Initiative which takes effect from 1 January 2010 and will only apply to practitioners who provide MBS services from that date.
The Chief Executive Officer (CEO) of Medicare will have the authority to issue a Notice to Produce Documents (Notice) to a practitioner, or another person who has custody, control or possession of the documents, to establish whether a Medicare benefit paid for an MBS service should have been paid. The Notice must include a statement that documents containing clinical details do not have to be produced unless these are necessary to substantiate the provision of the service.
The CEO must fulfil three conditions before a Notice can be served.
First, the CEO must have a reasonable concern that the Medicare benefit paid for an MBS service may exceed the amount that should have been paid. A reasonable concern may be related to a particular practitioner, a group of practitioners, or a particular service or groups of services. Medicare’s compliance audits will not review matters relating to clinical decision making, the clinical relevance of the MBS service provided, or professional conduct. Therefore, the elements of an MBS service which are not factual but, rather rely on the clinical judgement of a practitioner, will not be reviewed during a compliance audit.
Secondly, the CEO must take advice from a practitioner employed by Medicare on potential sensitivities associated with the kinds of documents a practitioner may need to provide to substantiate the service.
Thirdly, the CEO must give the person a reasonable opportunity to voluntarily respond to an audit request. Practitioners who choose to volunteer to Medicare that they have received a benefit that exceeds the amount they should have been paid may still be eligible for discounts on any financial penalty that may apply.
The Bill does not introduce any additional record-keeping requirements. The person who receives the Notice has the discretion to decide what documents are available to substantiate the MBS service, and does not have to produce documents containing clinical details to anyone who is not a practitioner employed by Medicare.
Guidelines are currently being developed which detail the type of information that will be considered as evidence substantiating particular MBS services or groups of services.
Importantly, documents and information about particular MBS services provided in response to a Notice cannot be used as the basis for a referral to Professional Services Review, or for most criminal and civil proceedings except in circumstances relating to false and misleading statements under the Act.
Practitioners are to be notified of the outcome of any audit. Where a debt is found to be owed to the Commonwealth, a practitioner will have 28 days within which to seek internal review of the decision before a debt notice is issued. Practitioners will remain liable to repay amounts if the MBS service cannot be substantiated.
Where a practitioner cannot substantiate the amount paid for an MBS service he/she may also be liable for a financial administrative penalty. It is proposed that a base penalty of 20% will be applied to debts in excess of $2,500.
This base penalty amount may be reduced or increased according to individual circumstances. For example, it will be reduced in varying percentages if a practitioner advises Medicare that an incorrect amount has been paid for an MBS service prior to being contacted by the CEO, before a notice to produce documents is issued, and after a notice to produce documents has been issued, but before completion of the audit. Where a practitioner does not respond to a Notice the full amount of the services identified in the Notice becomes repayable and the penalty is increased. Should a practitioner be unable to substantiate an amount paid for other services in the 24 months prior, and the total repaid was more than $30,000, the penalty in respect of the current amount which is being recovered is increased.
By Pamela Michael.
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