Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
2019-2020
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
HEALTH INSURANCE AMENDMENT (COMPLIANCE
ADMINISTRATION) BILL 2020
REPLACEMENT EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Health, the Hon Greg Hunt MP)
THIS MEMORANDUM REPLACES THE EXPLANATORY MEMORANDUM
PRESENTED TO THE HOUSE OF REPRESENTATIVES
ON 29 OCTOBER 2020
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HEALTH INSURANCE AMENDMENT (COMPLIANCE ADMINISTRATION) BILL 2020
OUTLINE
The Health Insurance Amendment (Compliance Administration) Bill 2020 amends the Health
Insurance Act 1973 (Health Insurance Act).
The Bill supports the integrity of the Medicare program by modernising the circumstances in which
the Commonwealth can recover a Medicare benefit or payment from a person when it should not have
been paid under the Health Insurance Act to ensure the Commonwealth's debt recovery powers work
as intended.
A Medicare benefit or payment can be recovered as a debt due to the Commonwealth in
circumstances where an incorrect amount is paid (purportedly by way of Medicare benefit or
payment) as a result of a person giving false or misleading statement. A Medicare benefit or payment
under the Health Insurance Act can be recovered where it was not payable and/or a person was not
entitled to be paid the Medicare benefit or payment.
This amendment supports current, emerging and future technological advancements to electronic
Medicare claiming, which are aimed at achieving efficiencies in Medicare claiming and payment
services, by updating the provisions from relying on the making of a false or misleading statement and
instead relying on the giving of false or misleading information.
Background
The Health Insurance Act and the legislative instruments made under it provide the legislative
framework for the Medicare program.
The Medicare Benefits Schedule (MBS) lists the professional services for which Medicare benefits
are payable and is sourced from the legislative instruments made under the Health Insurance Act. The
MBS includes information about professional services such as MBS item numbers, MBS item
descriptors (including any restrictions or other special conditions attached to the usage of the item),
schedule fees and Medicare benefit amounts. The MBS item number is relied on for Medicare
claiming purposes.
A patient can make a claim to Medicare for the payment of a Medicare benefit if they have incurred
an expense in relation to receiving a professional service listed on the MBS. Alternatively, a health
provider can bulk bill a patient, which means that the patient can assign their Medicare benefit
directly to the health provider. The health provider can claim the Medicare benefit directly from the
Government for that service.
Medicare claims can be made manually using the approved paper form but in most cases, Medicare
claims are made electronically through a variety of processing systems including online, through
mobile applications or using a bank's EFTPOS terminal (known as Easyclaim) available at the
medical practice. Medicare claims are processed and paid by Services Australia on behalf of the Chief
Executive Medicare (CEM), but the Department of Health (on behalf of the Chief Executive
Medicare) is responsible for health provider compliance functions, which includes conducting post
payment compliance activities to identify incorrect claiming and the recovery of Medicare debts.
Amendments to sections 129AC(1) and 129ACA(1)
Section 129AC(1) of the Health Insurance Act provides that if, as a result of the making of a false or
misleading statement, an amount paid, purportedly by way of benefit or payment under the Act,
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exceeds the amount (if any) that should have been paid, the amount of the excess is recoverable as a
debt due to the Commonwealth from the person by or on behalf of whom the statement was made.
Section 129ACA(1) is a similar debt recovery provision however it is only relied on for Shared Debt
Recovery Scheme cases.
The Bill amends section 129AC(1) and section 129ACA(1) to provide that an amount can be
recovered from a person in circumstances when a Medicare benefit or payment was paid under the
Health Insurance Act as a result of a person giving false or misleading "information" such that it
should not have been paid at all. The Chief Executive Medicare will no longer be required to identify
a false or misleading "statement" made by a person that resulted in the Medicare benefit being paid.
As the design parameters of electronic claiming mechanisms are built to achieve efficiencies, these
mechanisms may no longer support the inclusion of a specific statement or declaration being made by
a person in relation to a Medicare claim which is submitted electronically.
"Information" will be false or misleading where it is factually incorrect, and regardless of whether the
person giving the information knew that it was false or misleading, or whether the information given
was purposely or intentionally untrue. This includes circumstances where a person gives false or
misleading information either intentionally or unintentionally. This approach reflects the current
meaning of false or misleading in sections 129AC(1) and 129ACA(1).
To ensure that the Department of Health's post-payment compliance activities are not constrained by
current and future electronic Medicare claiming mechanisms, the amendment will capture broad
circumstances in which false or misleading information may be given, regardless of whether a person
makes manual or electronic Medicare claims. The Bill outlines that information can be given in a
document; in a statement; or in any other form. For example, a person who makes an electronic
Medicare claim would be giving information by entering data into the system in order to communicate
a fact in relation to the claim, i.e. the MBS item number. That information would be false or
misleading where, for example, the service in relation to the MBS item number was not rendered in
accordance with the legislative requirements. Where a health provider authorises another person (such
as a receptionist) to submit a Medicare claim for payment on their behalf, the health provider remains
the person responsible for the claims under their provider number, which is the approach taken in the
current drafting of sections 129AC(1) and 129ACA(1).
Similarly, the Chief Executive Medicare can recover directly from a health provider in circumstances
where a patient has submitted the Medicare claim but an incorrect amount was paid to the patient,
based on false or misleading information given by or on behalf of the practitioner.
The amendment specifies that if false or misleading information is given to Medicare through a
document, statement or in any other form, for example if the patient makes a Medicare claim that
relies on the health provider's billing invoice or receipt which specifies an incorrect MBS item, then
the incorrect amount that was paid to the patient can be recovered from the health provider. Another
example is where the patient uses the Easyclaim facilities at the medical practice to make their
Medicare claim, and in making their claim relies on incorrect information from the health provider
that the MBS item requirements for the services provided to them have been met.
The amendments to section 129AC(1) and section 129ACA(1) applies in relation to an amount paid
before, on or after the commencement of the Bill and which has not yet been the subject of finally
determined proceedings, or proceedings in which judgment is reserved, before a court. The
amendment is necessary to align with technological advancements in a modernised Medicare claiming
and payments regime, as well as improved service delivery for health providers and patients.
The legislative requirements in the Health Insurance Act, as well as the legislative instruments made
under it which provide the lawful basis for which Medicare benefits are payable, are unaffected by the
Bill and there is unlikely to be any adverse impact on the legitimate expectations of health providers
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who continue to be responsible for complying with their obligations in respect of providing
professional services, claiming and receiving Medicare benefits, under the MBS. A person who has
given false or misleading information and received Medicare benefits that they were not entitled to
receive, should not be allowed to unjustly enrich themselves at the expense of the Australian
community. There is a public interest imperative to ensure that Commonwealth money is protected,
and able to be recovered, to be reinvested towards Health initiatives for the Australian community.
Additionally, in specific circumstances where the number of services per patient may be limited by
the MBS (for example, for individual allied health services for people with chronic conditions and
complex care needs), incorrect claiming can adversely affect individual patients and prevent their
access to vital health services. It is important for these circumstances to be responded to by the
Government efficiently and effectively, to ensure that the MBS continues to operate for the benefit of
the Australian community.
Financial Impact Statement
There is no financial impact from this Bill.
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Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Health Insurance Amendment (Compliance Administration) Bill 2020
The Bill is compatible with human rights and freedoms recognised or declared in the international
instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Bill
The Bill amends the Health Insurance Act 1973 (Health Insurance Act). The Bill implements
measures to support the integrity of the Medicare program by making clear the circumstances, under
current and future claiming technologies, in which a Medicare benefit or payment can be recovered
from a person. The amendment clarifies that where an incorrect amount is paid (purportedly by way
of Medicare benefit or payment) as a result of a person giving false or misleading information, that
incorrect amount can be recovered as a debt due to the Commonwealth. The amendment allows a
Medicare benefit or payment made under the Health Insurance Act to be recovered where it was not
payable and/or a person was not entitled to be paid the Medicare benefit or payment because the
relevant legislative requirements were not satisfied.
Human Rights Implications
Right to Social Security
The Bill engages Article 9 of the International Covenant on Economic, Social and Cultural Rights
(ICESCR). Article 9 of the ICESCR recognises the right of everyone to social security, including
social insurance.
The Bill protects the sustainability of Australia's program of universal health care, ensuring that
Australians will continue to have access to affordable, high-quality medical and health services
funded by Government benefits. The Bill clarifies current arrangements for health compliance
activities, and ensures that recovery of incorrectly paid Medicare benefits may be made effectively.
Right to Health
The Bill engages Article 12(1) of the ICESCR. Article 12(1) of the ICESCR promotes the right of all
individuals to enjoy the highest standard of physical and mental health.
The Bill assists with the progressive realisation by all appropriate means of the right of everyone to
the enjoyment of the highest attainable standard of physical and mental health because the
amendments are clarifying the existing arrangements to support compliance activities to reduce
incorrect claiming of Medicare benefits. This will mean that the sustainability of the Medicare
program is protected. This Bill will help ensure that Medicare continues to provide support to
Australian patients.
The Bill does not engage any other rights or freedoms.
Conclusion
The Bill is compatible with human rights and promotes the right to health as it does not raise any
human rights issues.
The Hon Greg Hunt MP, Minister for Health
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HEALTH INSURANCE AMENDMENT (COMPLIANCE ADMINISTRATION) BILL 2020
NOTES ON CLAUSES
Clause 1 - Short Title
Clause 1 provides for the short title of the Act to be the Health Insurance Amendment (Compliance
Administration) Act 2020.
Clause 2 - Commencement
This clause provides that the Bill commences on the day after the Act receives the Royal Assent.
Clause 3 - Schedules
This clause provides that legislation that is specified in a Schedule to the Act is amended or repealed
as set out in the applicable items in the Schedule concerned, and any other item has effect according
to its terms. This is a technical provision which gives operational effect to the amendments contained
in the Schedule.
SCHEDULE 1 - AMENDMENT TO THE HEALTH INSURANCE ACT 1973
Schedule 1 amends the Health Insurance Act by inserting provisions that make amendments to the Act
in relation to recovery of statutory debts due to the Commonwealth.
Item 1 - Subsection 129AC(1) (heading)
This item amends the heading to subsection 129AC(1) of the Health Insurance Act by omitting the
reference to "statements" and substituting that reference with "information".
Item 2 - Subsection 129AC(1)
This item amends subsection 129AC(1) of the Health Insurance Act by omitting the reference to
"making of a false or misleading statement" and substituting that reference with "giving of false or
misleading information".
The phrase 'false or misleading' captures information that is factually incorrect, regardless of whether
the person giving the information knew that it was false or misleading, or whether the information
given was purposely or intentionally untrue. This includes circumstances where a person gives false
or misleading information either intentionally or unintentionally.
Item 3 - Subsection 129AC(1)
This item amends subsection 129AC(1) of the Health Insurance Act by omitting the reference to
"statement was made" and substituting that reference with "information was given".
Item 4 - Subsection 129AC(1)
This item amends subsection 129AC(1) of the Health Insurance Act by omitting the reference to
"making of the statement" and substituting that reference with "giving of the information".
Item 5 - After subsection 129AC(1)
This item amends section 129AC by inserting a new subsection 129AC(1AAA). Subsection
129AC(1AAA) provides for broad circumstances in which false or misleading information may be
given. False or misleading information can be given in a document; in a statement; or in any other
form. For example, a person who makes an electronic Medicare claim would be giving information by
entering data into the system to communicate a fact in relation to the claim, i.e. the MBS item
number.
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Subsection 129AC(1AAA) provides that the Commonwealth can recover an amount paid to a health
provider where a patient made the Medicare claim, but an incorrect amount was paid due to the
actions or conduct of the health provider giving false or misleading information, for example, in an
invoice or by entering data into an electronic claiming mechanism for the patient to submit.
Item 6 - Paragraph 129ACA(1)(a)
This item amends subsection 129ACA(1)(a) of the Health Insurance Act by omitting the reference to
"making of a false or misleading statement" and substituting that reference with "giving of false or
misleading information".
Item 7 - After paragraph 129ACA(1)(b)
This item inserts new subsection (1A) after subsection 129ACA(1)(b) of the Health Insurance Act.
New subsection 129ACA(1A) provides for broad circumstances in which false or misleading
information may be given. False or misleading information can be given in a document; in a
statement; or in any other form.
Item 8 - Subparagraphs 129ACA(2)(c)(i) and (ii)
This item amends subsections 129ACA(2)(c)(i) and (ii) of the Health Insurance Act by omitting the
reference to "making of the false or misleading statement" and substituting that reference with "giving
of the false or misleading information".
Item 9 - Paragraph 129ACA(6)(b)
This item amends subsection 129ACA(6)(b) of the Health Insurance Act by omitting the reference to
"making of the statement" and substituting that reference with "giving of the false or misleading
information".
Item 10 - Application provision
This item is an application provision which provides that the amendments in this Schedule apply in
relation to an amount that is paid before, on or after the commencement of the Schedule. The basis on
which a person owes a debt to the Commonwealth under section 129AC(1)and section 129ACA(1)
where false or misleading information has been given, would apply in relation to amounts paid by the
Commonwealth before, on or after the commencement of the Bill and have not yet been the subject of
finally determined proceedings, or proceedings in which judgment is reserved, before a court.
Where a person gives false or misleading information to the Commonwealth and the Commonwealth
pays a benefit that should not have been paid, it is in the public interest to be able to recover the
payment, even where this conduct has occurred prior to the commencement of the Bill. This is
necessary to ensure that Commonwealth money is protected, and is able to be recovered, to be
reinvested towards Health initiatives for the Australian community.
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