Shared Debt Recovery Scheme

If we detect incorrect Medicare payments during a compliance audit, the Shared Debt Recovery Scheme allows us to split a debt between the practitioner and the person who manages their billing and claiming.

About the scheme

Health practitioners often engage people to manage their billing and claiming, including under the:

If we detect incorrect Medicare payments during a compliance audit, the Shared Debt Recovery Scheme enables us to split any debt between the:

  • health practitioner (primary debtor)
  • the employer of the person managing the billing (secondary debtor).

Why the scheme is important

The scheme encourages health practitioners and their employers to work together to:

  • minimise incorrect billing
  • respond to Medicare audits
  • promptly repay debts arising from incorrect Medicare billing.

How the process works

Practitioners can request to split a debt with their employer before the decision is made.

We will notify the employer that they are a potential secondary debtor.

We may request documents from both parties:

  • about the debt
  • about the contractual arrangement
  • supporting whether or not to share the debt.

We write to both parties with:

  • the total debt amount
  • how the debt is being split
  • how we determined the split
  • any documents provided about the debt.

Each party can make a submission on whether the debt should be shared, and how it should be split.

We consider the submissions before making a shared debt determination.

When the scheme applies

We can only make a shared debt determination when:

  • there is a debt for us to recover
  • there is an employment or other contractual arrangement between the primary and secondary debtor
  • the secondary debtor could have controlled or influenced the false or misleading statement, or made a financial benefit from it
  • other factors make it fair and reasonable for a shared debt determination.

When the scheme does not apply

The scheme does not apply to:

  • adjustments that occur routinely as part of health practice, where a practitioner alerts us to an error to correct the claims record
  • a voluntary acknowledgement by a practitioner of incorrect payments
  • debts arising from inappropriate practice following referral to the Professional Services Review
  • debts arising from one party having committed Medicare fraud without knowledge of the other.

How the debt is shared

By default:

  • the health practitioner is responsible for 65% of the debt
  • the employer or person in a contractual arrangement such as a corporate (secondary debtor) is responsible for 35% of the debt.

We will consider a different split that is fair and reasonable, depending on:

  • any arrangements between the parties for apportioning the benefits paid (we look at the proportion of the benefits the health practitioner receives)
  • what influence or control the secondary debtor may have had over the billing.


The national Health Insurance Act 1973 governs the Shared Debt Recovery Scheme. The Health Insurance (Medicare Compliance Shared Debt) Instrument 2019 sets the recoverable amounts.


Shared Debt Recovery Scheme contact

If you have any questions about the scheme, please contact us.
Date last updated:

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