Television interview with Minister Butler and Sarah Ferguson, ABC 7.30 - 18 October 2022

Read the transcript of the television interview with Minister Butler and Sarah Ferguson on Medicare fraud.

The Hon Mark Butler MP
Minister for Health and Aged Care

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SARAH FERGUSON, HOST: Last night after 7:30 revealed allegations that a combination of fraud over servicing and billing errors could be draining up to $8 billion a year from Medicare, the Federal Government announced a review.  

Mark Butler is the Minister for Health and Aged Care. Minister, thank you for joining us. 


FERGUSON: Now, in response to our investigation you've asked your department to analyse Dr Faux’s claims, and to examine their own compliance programs. Shouldn't that be an independent investigation? 

BUTLER: I've asked them for a report on the existing compliance and professional services review programs. I want to get a sense, after nine years of being out of office, about how they're performing. 

I've obviously got some advice from the Department on the work that they do with doctors and other health professionals who claim under Medicare. But I want to see quite a comprehensive report.

Obviously also I want to see some analysis undertaken, preliminary analysis of Dr Faux's work, because the figures that her work cites are quite different to figures generally provided around the extent of improper claiming or even fraud under Medicare. Even going back to a report from the National Audit Office only two years ago.   

FERGUSON: That Auditor-General's report actually goes to two of the points that we have here. That Auditor-General's report in 2020 found that the Health Department's own systems for monitoring false or improper claims were insufficient and needed reforming. 

Isn't that why, to go back to my first question, why it should be independent? 

BUTLER: That may well be where we end up, Sarah, I just want to see an initial piece of work. I've read some other material about this, including a submission that Dr Faux recently made to a Senate Committee looking at some legislation we have before the Parliament right now around compliance programs. 

So this is a bit of a moveable feast. I'm still a relatively new Health Minister, so I'll take this a step at a time. But I do recognise the gravity of these issues. 

FERGUSON: Now Dr Faux is willing to defend and debate her methodology, but we're now seeing a number of strong voices agreeing that Medicare is losing billions of dollars each year. 

How important is it also to have this debate right now when the budget is under so much pressure? 

BUTLER: I think anyone using Medicare services - and that's pretty much every Australian - understands right now just how precious every single dollar going into the system is. And doctors and health professionals understand that perhaps more than most. 

And I think that's been the response you've seen over the last 24 to 36 hours, after nine years of cuts and neglect, particularly a six-year Medicare rebate freeze, it's more important now than ever before that we get maximum value for money.

So, of course, I'm taking these issues seriously, Medicare and Strengthening Medicare in particular, was right at the centre of our election platform a few months ago. 

FERGUSON: In our report last night, the former Medicare regulator, Tony Webber, confirmed the scale of the problem. A decade ago, Dr Webber reported on large scale abuses within the system, costing Medicare up to $3 billion a year. 

Shouldn't the urgent focus now be on fixing the system rather than asking the Health Department to inquire into itself? 

BUTLER: I haven't asked the Health Department to inquire into itself. I've asked for a report on the existing systems. And there will be further steps after that to ensure that we've got the best possible system to guarantee value for money. 

There are strong arrangements in place already that see a great deal of contact with Medicare providers, doctors and other health professionals to ensure they're doing the right thing, where questionable climbing practices are picked up with our advanced data analytics. 

Thousands of letters are provided by the Department to Medicare providers every single year. I think there's been about 15,000 over the last little while. And in the most egregious cases where there is demonstrated fraud, people are taken before the courts. 

That's a very tiny minority amongst the tens and tens of thousands of honest, hardworking health professionals we're lucky enough to have in this country. But where it happens, it's picked up and it's prosecuted. 

FERGUSON: Just to come back to what the Auditor-General's report said, and I'll quote it, it said there was little evidence that compliance project outcomes were systematically monitored or assessed, which sounds like a monitoring system to capture fraud that is not fit for purpose for a system that is as broad and expensive as Medicare.  

BUTLER: It's got a lot more purpose than just capturing fraud, although that's obviously an important one of them. It's about educating providers. It's about giving providers an opportunity to ask questions when they're unsure about the application of what is a relatively complex system with more than 5000 different Medicare items.  

And it's about early detection and communication with providers who are often doing the wrong thing, if they are quite innocently, and getting them to correct their own behaviour. 

It is much more multi-layered than just the detection of fraud. The detection of fraud really is the top of the pyramid, a very small number of cases where people are deliberately doing the wrong thing and we must have a system for the confidence of all taxpayers and health professionals, we must have a system that picks them up and deals with them. 

FERGUSON: Since that report said that the Department's approach to compliance was only partially effective - they are very strong words. Do you know - you are the new Minister - but do you know what's been done to address those weaknesses that were identified then? 

BUTLER: No, and that's really the report that I've asked to receive from the Department. And look, I've got an open mind about this. There is nothing more important, particularly at a time where Medicare is under such pressure, particularly general practice, than making sure that I can say as the Health Minister to taxpayers, and to all the other health professionals, we are getting maximum value for money out of our Medicare dollar.  

I've got an open mind. If there are ways in which we can improve this system to get that value for money, to have the confidence of health providers and of patients, I'm all ears. 

FERGUSON: Let's talk about the responses because some individual doctors or medical specialists once caught out are having to refund tens of thousands, or hundreds of thousands of dollars to Medicare. 

How many doctors have lost their Medicare billing privileges after misusing the system? 

BUTLER: And that's one of the questions that I have asked. I think your report last night talked about a dentist who had been forced to pay back hundreds of thousands of dollars, and also received counselling.  

Now, that strikes me as a disproportionate penalty. Someone who so egregiously miss-claimed taxpayer funds. And perhaps even worse, potentially, put children at risk of overtreatment.  

So, I've asked in particular to see whether the penalties that are put in place for the most egregious examples of misconduct are proportionate. And I think that's something that all taxpayers would want to understand. 

FERGUSON: Our understanding is that offenders lose the right to bill certain item numbers, but even when they've been found out, they're able to continue billing the system on other items. Is that acceptable? 

BUTLER: These are obviously case by case examples, but I think if someone is demonstrated to have rorted Medicare deliberately, then I think there is a very big question over their entitlement to use a taxpayer funded system into the future. 

But these are pieces of advice that I've asked the Department in particular to provide me. 

FERGUSON: There's also a question over report versus action that clearly reports about the misuse of the system have been going on for over two decades. I think in late 2020, the Medicare Benefits Schedule Review Task Force delivered 1400 recommendations on modernising the scheme. That's late 2020. Will you now go back and review those recommendations? 

BUTLER: We're reviewing all of the work that was provided to the former government as is appropriate by a new government, that takes some time. We have our own priorities as well - the Budget next week.

I've convened the Strengthening Medicare Task Force to deal with some very serious pressures on general practice right now.  

But of course, any new government coming in will want to look at advice provided to the former government and check whether that was implemented in an appropriate way. 

FERGUSON: Mark Butler, thank you very much indeed for joining us. 

BUTLER: Thanks.


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