5 July 2022

Bring out your dead (and bill them to Medicare)

Comment KnowCents Medicare

The system is milked by the unscrupulous while innocent doctors are hounded. We need reform before rebates can rise.


Many years ago, a geriatrician asked me whether he could bill for signing a patient’s death certificate.

I dutifully explained the correct legal position, which was that he could not if that was all he did, but according to Medicare, if he had attended to determine whether life was extinct, he could bill the appropriate attendance item. His pithy reply came: “Well, they asked me to come and see if she was dead, and she was, so can I claim it?”

Medicare’s longstanding description of what you can and cannot bill around the moment of death has always been unhelpful and confusing. But let’s be clear: it is not possible to provide a clinically relevant service to a patient (which the law defines as a service that is necessary for the treatment of the patient) if the patient is dead.

Additionally, a longstanding and sound health policy position prevents billing for removing organs for transplant into another human (irrespective of whether the donor has just died or is alive) because the clinically relevant service is provided to the recipient, not the donor.

Every now and then we see Medicare claims rejected because the date of service is after the patients’ date of death. The cause is usually that the doctor has two patients with the same name and the wrong one was accidentally billed. Once or twice, I have also seen the date of death incorrectly recorded at Medicare, but these scenarios are rare. More often, billing for dead patients is straight-out fraud.

Quite recently, a GP successfully appealed a decision that had landed him in jail for billing dead patients. He had served nine months of a four-year prison term before an appeal set him free. And if you read the PSR monthly case outcomes, you will see frequent reports of both GPs and specialists billing for services they did not provide, and sometimes billing dead people. The recently departed PSR director also confirmed that the agency deals with doctors who bill the dead, calling it out as fraud.

So, why aren’t more of these fraudsters in jail, and what can be done to fix it?

Well firstly, fraud is a criminal offence attracting the highest evidentiary burden – beyond a reasonable doubt (BRD) – and it has to be proven for each individual claim, rather than being applied across a doctor’s whole universe of claims (the PSR’s usual MO). So, it usually makes no financial sense to run criminal proceedings for $39 claims, especially when the doctor will often mount a successful defence of ignorance.

It is these precise problems – small transaction values and fraud being a crime attracting BRD – that caused us to end up with the PSR in the first place. It was thought that using extrapolation, and building rules like the 80/20 rule, would overcome the problem of having to prove the veracity of each individual claim. At least the government would be able to claw back money that should never have been paid, even if it couldn’t put criminals in jail.

But the PSR only reviews about 100 practitioners per year, representing about 0.08% of all AHPRA-registered medical practitioners. Barely a sliver. And while a few who are caught are criminals, others have just made genuine mistakes thanks to incomprehensible rules.

No surprises, therefore, that my research found the majority of non-compliant billing goes unchecked. For example, in my doctoral thesis I have listed 25 common types of non-compliance, and I know where each of those 25 things are happening, but I am almost certain the government does not.

So, what we have is a failed policing system where some very good clinicians are having their lives destroyed for unintentionally breaching an unknown rule, while doctors who are more cunning with their billing, and sometimes also clinically dangerous, fly under the radar. I see both all the time, and the area of cosmetic surgery has been particularly disturbing.

Every single record I reviewed in the course of the recent cosmetic surgery investigations included evidence of non-complaint Medicare claims. Medicare does not reimburse cosmetic treatments and procedures because they are not clinically relevant – the patient does not need them. Yet I saw everything from anaesthetics, abdominoplasties, GP and specialist consultations, fictitious skin procedures, fake referrals, and dodgy pathology and diagnostic imaging claims.

None of it will ever be picked up by the department without a tip-off, and if you extrapolate it across the multi-billion-dollar cosmetic industry, it will likely add up to a considerable proportion of the approximately $7 billion that I estimate is currently leaking from Medicare.

Imagine if we could rein in the cosmetic cowboys and others who wilfully plunder the public purse, and redistribute that money to increase GP rebates.

Well, with some swift regulatory reform, digitisation, and the coding of non-admitted patient encounters, many of these problems can be solved, or significantly reduced. With just a little bit of extra data added to each claim, we can stop incorrect claims for things like cosmetic surgery and consults on dead people before they are paid, saving everyone time and money.

What we must not do is increase Medicare rebates until the system has been brought under control. Perhaps with fresh faces and the right skill mix on the new government’s promised Strengthening Medicare Taskforce, we can make this happen.

Dr Margaret Faux is a health system administrator, lawyer and registered nurse with a PhD in Medicare compliance, and is the CEO of AIMAC, which offers courses and explainers on legally correct Medicare billing.

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16 Comments on "Bring out your dead (and bill them to Medicare)"

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Ruth Ratner
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Ruth Ratner
1 month 1 day ago

My understanding of attending to certify death is that the patient isn’t dead until he or she is certified as such. In the old days a nurse was not able to notify the family until the doctor attended. So, as far as I am concerned, I am called to attend my patient who I then certify as no longer living. What I write while I am there is not of concern to Medicare.

Andrew Miller
Guest
Andrew Miller
1 month 1 day ago

PSR, please audit all cosmetic surgeons. Now.

Chris Lawson
Guest
1 month 10 days ago
Margaret, I am all in favour of better detection and prosecution of Medicare fraud. Apart from the obvious financial drain, I suspect that fraudulent billing is strongly associated with poor medical practices. But there’s no way that savings from fraud prevention and recovery will go towards increasing Medicare rebates unless there is a major change in political strategising at the federal level. Any savings will be snaffled by the government rather than passed on to practitioners. As for not increasing the rebate until fraud is stamped out, I’m sure you are aware that general practice is already woefully underfunded by… Read more »
Margaret Faux
Guest
1 month 9 days ago
Thanks for your comment Chris. The ECG changes were appalling, I agree. My research found that the MBS review taskforce may have done more harm than good, has definitely increased confusion and exposure to unintentional non-compliance in some areas, has sent our bedrock clinical dataset down a divergent path from the rest of the world, and has almost certainly put OOPs up, especially in the specialist and imaging sectors. The taskforce just seemed to fail to understand that removing a rebate does not stop a doctor from continuing to legally provide the service, it just means there is now no… Read more »
Peter Bradley
Member
Peter Bradley
1 month 10 days ago
I certainly do NOT agree with this statement. “What we must not do is increase Medicare rebates until the system has been brought under control. Perhaps with fresh faces and the right skill mix on the new government’s promised Strengthening Medicare Taskforce, we can make this happen.” Because the rorting by a few is not a justification for not increasing rebates realistically, and is not the reason. It is just plain money-saving miserliness on the part of successive governments. However, I agree that the improvements mooted above to rein in this wastage should occur in parallel with reasonable increases in… Read more »
Margaret Faux
Guest
1 month 10 days ago
Your points are duly noted peter. So would you agree to trial adding SNOMED codes into your MBS claims in return for immediate increased rebates? We could do this right away as a pilot, and if you are completely comfortable with your billing there would be no reason to say no. In fact, with SNOMED codes you wouldn’t need to be worried about claiming long consults and getting pinged, because the SNOMED codes would explain the complexity. 90% of Australians have already consented to SNOMED by virtue of having a MHR, so the privacy issue is also dealt with. All… Read more »
Peter Bradley
Member
Peter Bradley
1 month 10 days ago
Margaret, if I was still in practice I’d certainly hold my hand up for that. I was an early adopter of the eRecord, believed fervently in accurate and detailed records – which no doubt of itself in terms of time taken, cost me money – and I don’t think I ever, in my entire career, deliberately wrongly claimed an item. Sometimes I even chided myself as being honest to the point of absurdity almost, but I was always very aware of just how much trust was involved in the way general practice – medicine in general actually – is funded… Read more »
Margaret Faux
Guest
1 month 10 days ago
Thank you Peter. I have met and interviewed a lot of great GPs like yourself who have probably almost never claimed incorrectly and if they did, felt so overcome with guilt that they paid the money back to Medicare. We have to solve the problem of zero visibility in our health system or we will quickly drop off our podium position and will be health system laggards just like we were climate laggards. I am not married to my proposals for reform, although the evidence supports them and they are in line with international health system activity. But whatever solution… Read more »
Peter Bradley
Member
Peter Bradley
1 month 10 days ago
Ok, so why not give the salaried alternative solution a plug then..? Because apart from the benefits of it from the money leakage point of view, one other vital thing it could then provide, is the major lack that makes GP unattractive – over and above the income issue – and that is the complete lack of anything even remotely resembling a career pathway, with recognition of age, length of service, experience, qualifications, etc. My income, when I retired at 72, was probably the lowest it had ever been. Yet I was still at the top of my game and… Read more »
Margaret Faux
Guest
1 month 9 days ago
The reason I haven’t actively promoted the salary option is because I’m still unclear exactly how it would solve the visibility or leakage problems. I work in many countries and most now code outpatient activity using the US coding and classification system – ICD10CM/CPT. I am not recommending we adopt that here because it has its own problems, but it does provide a level of transparency that we do not have. A salary option would still mean the employer would be billing through the MBS, so it seems to me we would be just shifting the problem. All countries are… Read more »
J.C.
Guest
J.C.
1 month 10 days ago

I think around 10 yrs of sub-inflationary raises and blaming that on the unscrupulous few is a poor argument for destabilising primary care.

Margaret Faux
Guest
1 month 10 days ago
J.C I am a health system lawyer. I have no vested interest in any particular sector of any health system. My only interest is in ensuring universal health coverage systems work for everyone – payers, patients and providers. Currently, Medicare is working for no-one and the evidence makes clear we need urgent structural reform. I have no desire to ‘destabilise primary care’ as you have incorrectly stated. In fact, the opposite is true if you read my work. But we cannot afford to increase rebates. Australia cannot afford to spend more of its GDP on health. It instead needs to… Read more »
Dr Ross
Guest
Dr Ross
1 month 10 days ago
Margaret I disagree partially with your comments, especially the first phase .” But we cannot afford to increase rebates” – what rubbish !. I do agree that “Australia cannot afford to spend more of its GDP on health.” it just need to spend the money more wisely and efficiently WE CAN afford to increase rebates as the Medicare % paid to GP is very small in comparison paid on PBS, NDIS etc let alone the awfully huge % spent on public hospitals. The Fed govt document on this released in March is sicking to read especially how little is spent… Read more »
Margaret Faux
Guest
1 month 9 days ago
Thanks Dr Ross. I appreciate your passion for this topic, which I share. I know GPs are in a terrible situation, but I strongly disagree that pouring more money into the equation will help. It will not, and the evidence is clear on that. Plus Australia now has trillions of dollars of debt, so there is really no chance of increased rebates. But in any event, more money would just go into a big black hole, and the government still will not have any oversight over what it pays for. Think about this – lets say we increase the item… Read more »
J.C.
Guest
J.C.
1 month 10 days ago

Perhaps we can use that argument for the pollies, no pay rises or expense payments, until they weed out corruption and frank incompetence.

Margaret Faux
Guest
1 month 10 days ago

I support that.

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