Better Health Care

I spoke in Parliament this week about the government's health reform agenda.
Health Insurance Amendment (Compliance) Bill 2010
2 March 2011

Medicare is a central component of Australia’s universal healthcare system. It is a system that provides affordable treatment for Australians by the dedicated health professionals in our public health system. Introduced in 1975 by the Whitlam government, Medibank—as it was then—allowed for the subsidisation of medical treatment in public hospitals that has made health care more accessible and affordable and has added to the quality of the lives of Australians over the last 35 years. I want to place on record the role played in creating Medibank by Dick Klugman, member for Prospect from 1969 to 1990, who passed away just recently, on 21 February. In 1984, Medibank was renamed Medicare by the Hawke government, who returned it to the original model to reflect the great traditions of equity, fairness and dignity for all Australians—which are characterised by us in the Labor Party. The Health Insurance Amendment (Compliance) Bill 2010 adds to the history of responsible Labor governments by balancing the public interests of confidentiality and privacy with ensuring that public funds are spent appropriately and responsibly.

As part of the governments responsible economic management policy agenda, the Health Insurance Amendment (Compliance) Bill 2010 proposes to amend the Health Insurance Act 1973 to implement the increased Medicare compliance audits initiative announced in the 2008-09 budget. With expenditure on the Medicare benefits scheme over $15 billion in 2009-10, it has grown by more than $1 billion per annum over the last three years. This bill will put in place a system of compliance audits—checks that make sure that the services that are delivered meet Medicare item requirements. We are doing this in order to ensure that taxpayers’ money is spent appropriately, as taxpayers, I am sure, would wish to be the case.

Presently, medical practitioners are not required to produce documentation during a compliance audit conducted by Medicare Australia, and Medicare Australia does not have the authority to require compliance with the request. As a result, around 20 per cent of practitioners either do not respond or else refuse to cooperate with an audit request. This bill addresses that problem.

The bill enables the Chief Executive Officer of Medicare Australia to give notice of the production of documents to a practitioner to substantiate a Medicare benefit paid for a service. To address concerns of due process raised by key stakeholders in the process, the government has put in place four safeguards. Before a notice to produce documents can be issued, the CEO must first have a reasonable concern that the Medicare benefit paid for a service may exceed the amount that should have been paid. This means that Medicare Australia cannot conduct random compliance audits under the provisions of this bill. Secondly, the CEO must take advice from a medical practitioner employed by Medicare Australia on the kinds of documents a practitioner may need to provide in order to substantiate that kind of benefit. Thirdly, the CEO must take reasonable steps to consult with a relevant professional body about the types of documents required to substantiate a benefit before commencing a compliance audit; and, fourthly, the practitioner must be given a reasonable opportunity to respond to a written request to voluntarily provide relevant documents.

As a result, this bill does not add to the workload and record-keeping requirements of already busy practitioners. Provisions for the protection of sensitive information ensure that only information relevant to the purpose of substantiating benefits is produced. No clinical or private details will be required unless they pertain to the substantiation of the benefit payment.

Medicare Australia is also working with the Australian Medical Association and other stakeholders to develop guidelines for practitioners on the kinds of information that may be used to substantiate particular services or groups of services. In accordance with this bill, practitioners must be given 28 days in which to seek an internal review of an audit decision before a debt notice is issued. During this time a practitioner may provide additional material to the CEO to substantiate a Medicare benefit.

The Health Insurance Amendment (Compliance) Bill 2010 will provide savings of around $148 million over four years, and it is expected that the provisions contained in the bill will generate further savings of at least $132 million during this time. Protecting the integrity of Medicare and enhancing Medicare Australia’s current audit program is a crucial element in ensuring that the Australian people know their public funds are spent appropriately and responsibly in the provision of the health services they rely on. The Gillard government is committed to responsible economic management and delivering the world-class services that Australians are entitled to expect—all this in the great traditions of the Labor Party, the originators of Medicare. I commend this bill to the House.

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