New legislation to better detect PBS fraud


A bill is being considered to give the government more powers to investigate PBS and MBS fraud, including claims for medicines that have not been supplied

Health Minister Greg Hunt has introduced a bill into Parliament that gives the government stronger abilities to detect fraud through data-matching between the MBS, PBS, private health insurance, AHPRA, the TGA and even the Department of Home Affairs.

The bill has now been read a second time in the Senate, after passing through the House of Representatives last month.

“The overwhelming majority of healthcare providers claim MBS, PBS and Child Dental Benefits appropriately,” said Minister Hunt when introducing the bill.

“Unfortunately we know that a very small proportion do not.

“It is entirely reasonable for Australians to expect that the government has appropriate systems in place to detect instances of Medicare non-compliance. This will ensure that every taxpayer dollar of our precious healthcare spend is directed to clinically necessary services for Australians.”

Minister Hunt points out that current legislative restrictions prohibit linkage of MBS and PBS data, making it difficult to detect potential fraud.

The bill will permit data-matching across the MBS and PBS to enable, for example, the identification of instances where the Commonwealth has paid for a PBS medicine that was not actually supplied.

This also allows the government to identify whether a person may have claimed or been paid a benefit that exceeds the amount of the benefit that was payable to the person – and recover overpayments of benefits under Medicare.

The bill supports matching of data from Medicare and the Department of Veterans’ Affairs to ensure that services provided under both programs have been provided appropriately, where exceeding a certain number of services on a certain number of days may be considered “inappropriate practice”.

Data-matching between the Department of Health and the Australian Health Practitioner Regulation Agency will be used to ensure restrictions placed on registered healthcare providers by their professional board are adhered to in MBS or PBS claiming.

Meanwhile data-matching with records held by the Department of Home Affairs will be used to determine that both the healthcare provider and patient were in Australia at the time of their claimed services.

The bill will also allow private health insurers to voluntarily share information with the Department of Health for the purposes of detecting fraud and recovering incorrect payments.

However the government says the legislation does not allow it to share any patient information collected by the government with private health insurers, and will have a number of safeguards in place in relation to the use of information.

According to the bill, information will only be disclosed when necessary for matching, and only matched when necessary for a permitted compliance-related purpose.

“The government acknowledges the importance of protecting an individual’s privacy and the trust placed in the government by Australians to manage their health data appropriately,” said Minister Hunt.

“Protecting the privacy of an individual’s health and other data is central to this bill.”

He said a legislative instrument will set out how information for data-matching will be handled “will ensure that the use, storage, access and handling of data protects privacy”.

This includes giving the Information Commissioner oversight of data-matching as it relates to information about an individual, including conducting assessments in relation to the Australian Privacy Principles.

The bill will amend the National Health Act 1953 and the Health Insurance Act 1973 and make minor amendments to the Military Rehabilitation and Compensation Act 2004, Privacy Act 1988, Private Health Insurance Act 2007 and Therapeutic Goods Act 1989.

Minister Hunt thanked the Pharmacy Guild of Australia, the Australian Medical Association and the Royal Australian College of General Practitioners for their input into the design of the bill.

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