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Misuse of Medicare Chronic Disease Items

Serious concerns have been raised about the misuse of taxpayer-funded chronic disease management plans by ‘less scrupulous’ medical practices for personal financial gain, and millions of dollars in incorrect Medicare claims have been ordered to be repaid.

The Federal Government’s independent Professional Services Review (PSR) Agency’s 2014-15 Annual Report on Medicare compliance activities against health practitioners shows referrals to the PSR for investigation increased 40 per cent in 2014-15, resulting in further action being taken in 70 per cent of cases. Outcomes included ordering $4.17 million worth of repayments and various reprimands and restrictions on the practitioner’s access to Medicare benefits.

In particular, the report raises growing concerns around the exploitation of ‘grey areas’ and ambiguities in the Medicare Benefits Schedule (MBS) that are allowing Chronic Disease Management (CDM) items to be misused, after they featured in about half of all PSR compliance cases in 2014-15:

Minister for Health Sussan Ley said the warnings around the misuse of Chronic Disease Management items demonstrated the importance of the Turnbull Government’s integrated approach to building a healthier Medicare.

I know the majority of health professionals and practices do the right thing…

“These findings show the importance of having clear, strong rules around the use of individual Medicare items to ensure they are clinically relevant and reflect contemporary practice, but also aren’t misused for financial gain,” said Ms. Ley.

“This is particularly important as Medicare’s current fee-for-service model struggles to support patients and their doctors to manage increasingly complex chronic conditions that require integrated care between various health disciplines.”

Ms. Ley said she was deeply concerned that “grey areas” and ambiguities in the rules made it harder to track and prove non-compliance by ‘less scrupulous’ practitioners and that these referrals to the PSR may be just the “tip of the iceberg”.

“We’ve seen over 22 million Chronic Disease Management items alone claimed against Medicare at a cost of $2.7 billion in the nine years since they were introduced,” said Ms. Ley.

“This is significant when you consider the number of Medicare items claimed have now reached an average of one million per day.

“I know the majority of health professionals and practices do the right thing by their patients and taxpayers and it’s important we have a compliance system with the appropriate investigative powers and teeth to protect their integrity and avoid public confidence being undermined.

“As this report acknowledges, a big part of the problem is the compliance system governing Medicare is 20-to-30 years old – just like many Medicare items themselves – and I want to work with health professionals to update it to reflect 21st Century medical practices.”

Ms. Ley said it was not too late for health professionals and patients to have their say as part of the Government’s review of all 5700 Medicare items and the rules governing their use on the Department of Health’s website.

The Government’s Professional Services Review is made up of independent committees of respected medical professionals who peer review serious allegations of Medicare non-compliance against health practitioners that are detected by the Department of Human Services.

As part of investigations the PSR uncovered examples where some individual practitioners had ordered between 600 and 1000 Chronic Disease Management (CDM) items each last year alone.

The PSR also found evidence of some practices pressuring their doctors to undertake higher numbers of CDM items to increase earnings. The main Chronic Disease Management items available through Medicare are a GP Management Plan (item 721) currently worth $144.25 and a Team Care Arrangement allowing referrals to allied health professionals (item 723) worth $114.30.

This is compared to $37.10 for a standard Level B GP consultation for up to 20 minutes. “A visit that might have attracted an MBS payment for a standard attendance of around $40 turns into a visit attracting total MBS payments of around $250,” the PSR reports.

However, Ms. Ley said the PSR also raised GP concerns that some patients were putting pressure on doctors to order Chronic Disease Management items so they could access rebates for allied health services that otherwise could not be claimed on Medicare.

“Again, it shows our current system that bills Medicare every time a single service is delivered isn’t providing the best outcomes for patients, health professionals or taxpayers managing chronic disease.”