Accused Medicare rorters hit back as department unites with police

Doctors and providers accused of misusing Medicare are using lawyers to ‘game the system’, the Health Department has been told.

Doctors and other providers accused of misusing Medicare are refusing to repay the money and even using the same lawyers to “game the system”, the Department of Health has been warned.

The Australian yesterday revealed the department was working with police on a test case to seize the assets of Medicare rort­ers and demonstrate it was not a “soft enforcer”.

The use of the Proceeds of Crime Act, normally associated with drug traffickers and fraudsters, would represent a fundamental shift in Medicare compliance operations.

From July, the department can also demand repayment by employers and other third ­parties, not just doctors whose Medicare provider number was used for dubious billing.

The department is consulting on what might constitute an appropriate split of the bill in such cases, suggesting the doctor pay 65 per cent.

Consultants Ernst and Young did an assessment last year and found that the department’s perception as a “soft enforcer” must be addressed. A pilot program was recommended to establish the legal enforcement capabilities — likely to involve the test case — and “assist in bringing about cultural change in respect of noncompliance activity”.

The consultants suggested “recalcitrant providers” be targeted, with media releases sending a message to the sector on the need to comply. “Some providers appear to have a low level of concern for outstanding debts,” Ernst and Young advised.

“Multiple providers using (the) same legal representative to dispute debts may indicate ­debtors are attempting to ‘game’ the system.”

The Ernst and Young advice included an assessment of outstanding debts. The department redacted the figures before releasing the documents under Freedom of Information laws.

Last financial year, the department raised $49 million in debts against providers.