Why is this important?
When a debt is owed to the Commonwealth, debtors should be making appropriate and timely arrangements to repay what they owe. Currently, however, only 25 per cent of health providers who have a Medicare debt agree to enter into arrangements to repay those debts.
Under compulsory offsetting, a maximum of 20 per cent of future payments will be offset to recover outstanding debts to ensure providers are not financially disadvantaged.
Increasingly, doctors and other health providers are working in large practices or for large organisations, such as medical corporations or hospitals.
Under the Health Insurance Act 1973, health providers such as GPs are responsible for the accuracy of all Medicare claims made against their provider number. However, in larger practices or medical corporations, the claim may be made by someone other than the provider (e.g. practice managers).
These amendments will address the evolving structure of the sector to ensure that where an incorrect claim is made, the party that receives the financial benefit is liable to repay any debts owed.
Other changes require doctors, dentists, pharmacists and other health providers to face the same time periods for record keeping, and have similar obligations to repay debts or compulsorily provide documentation to the Department of Health.
Who will benefit?
All Australians will benefit through an efficient and effective Medicare that is underpinned by a strong functional compliance framework.
How much will this cost?
This measure will save $103.8 million from 2016–17 to 2020–21.