Medicare non-compliance and fraud costing Australians

The Albanese Government has today released the findings of a review into the compliance system that underpins Medicare.

The Hon Mark Butler MP
Minister for Health and Aged Care

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The Albanese Government has today released the findings of a review into the compliance system that underpins Medicare.
 
The Government commissioned respected health economist Dr Pradeep Philip to conduct the Independent Review into Medicare Compliance and Integrity last November in response to concerning reports about the potential for widespread Medicare rorting and fraud.
 
Dr Philip’s Review makes clear that the overwhelming majority of health practitioners are well meaning and protective of Medicare, and they provide a high level of care to their patients.
 
Dr Philip also found no evidence to support the $8 billion figure highlighted in some media reporting.
 
The Review found that the likely cost to Australian taxpayers is $1.5 to $3 billion a year, with a significant part stemming from non-compliance errors rather than premeditated fraud. But without concerted action this figure could increase.
 
The Philip Review makes it clear that these problems have been a long time in the making.
 
The loss of billions of dollars a year in taxpayer money was consistently and repeatedly highlighted to the former government in no fewer than five separate reviews between 2016 and 2021, by respected bodies like the Australian National Audit Office, Boston Consulting Group, McKinsey and others.
 
The former government failed to act to protect Medicare.
 
The Philip Review makes 23 recommendations, including:

  • strengthening the governance model that oversees integrity from a whole of Medicare perspective, from policy and legislation through to payment systems and compliance
  • removing the veto power of professional bodies in the selection process of the Director of the Professional Services Review
  • ensuring that the legislation that underpins Medicare integrity is amended to be effective and fit for purpose
  • improving the detection and disruption of fraud and non-compliance, and mechanisms to address inappropriate and incorrect claiming
  • improving clarity and consistency for health providers through system improvements, simplification of policy, closer coordination and better education on Medicare rules
  • up-lifting technological and systems capabilities across Medicare.

The Government is considering the recommendations in Dr Philip’s review and will now work closely with health professionals, patients and peak bodies to develop a comprehensive response.
 
Read Dr Philip’s review.

Quotes attributable to Minister Butler:
 
“The former government was given five separate reviews, including from the Australian National Audit Office, that told them billions of dollars in taxpayer money was being lost each year. They failed to act to protect Medicare.”
 
“Australians know that the overwhelming majority of our doctors and health professionals are honest, hardworking and comply with Medicare rules.”
 
“But they also understand that, at a time of great pressure on household and Government budgets, every dollar in Medicare is precious and must be spent directly on patient care.”
 
“Strengthening Medicare also means safeguarding the taxpayer funds that underpin it and this Government is committed to that task.”
 
“I thank Dr Philip for his considered report. I also thank the professionals from across the health system who generously provided their time and expertise.”

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