10 May 2022

Time to reform litigation-plagued PSR 

Government Political PSR

PSR law is written so the PSR wins, but “this dreadful piece of legislation” has had its day. 


A doctor embroiled in a PSR matter asked me why the legal profession doesn’t speak out more, and demand change to what he described as “this dreadful piece of legislation”. He went on: “I mean, the lawyers acting for the government literally cannot lose. PSR law is written so the PSR wins. You probably don’t even have to be a very good lawyer!” 

His point was well made, and it is certainly true that lawyers receiving briefs to act on behalf of the PSR have the odds stacked in their favour. 

However, it should not be forgotten that good judges must necessarily apply questionable laws, and true justice may therefore not always be served.  

In Anchita Karmakar’s case, the Honourable Justice John Logan made numerous insightful comments about the need for reform in the area of the MBS and PSR law. He clearly acknowledged there was no education for doctors, no reliable advice and support, that MBS descriptions can be vague and interpretive, and junior doctors have little or sometimes no control over their MBS billing.  

Following this decision, commentary disseminated among the legal profession described His Honour’s comments as representing the first significant judicial acknowledgment of underlying systemic dysfunction. However, it was not the court’s role to address policy failures or re-write unfair laws. That falls to our politicians.  

Occasionally, judicial officers become so troubled by the decisions they are forced to make that they step down. In Lismore a magistrate resigned in 2020 primarily over “grossly unfair” drug driving laws. 

There probably haven’t been enough PSR cases for judicial officers to step aside, their consciences tested from seeing too many doctors’ lives destroyed for accidentally breaching unknown rules. And there are definitely not enough lawyers skilled in this very niche area to make enough noise to bring about immediate change.  

But it is nevertheless important to be aware of some PSR facts and stats. The PSR has been plagued by litigation since it began, particularly in the area of procedural fairness. My research found that it has averaged more than 10 contested proceedings per year every year for the past 25 years. One has to ask why. 

One of the enduring mysteries around the establishment of the PSR was the lack of clarity around what the new offence of “inappropriate practice” was intended to remedy. The offence was not only vague by its title, but it expanded the PSR’s remit beyond fraud and overservicing (which were the former offences) for no apparent reason.  

The second reading speeches introducing the PSR Bill into parliament shed no light on this important omission, which appears to have led to the creation of an initially rudderless organisation with a remit to prosecute so-called inappropriate practice, but with no benchmark for appropriate practice. This remains so today, with no clear indication of what is “appropriate practice” or why the word “practice” is used (implying clinical conduct), when the offences within the PSR’s remit relate to financial conduct. 

In 2013, Mark Robinson SC, a barrister well versed in PSR matters, delivered a conference paper to the legal profession about the PSR, describing the problem of inappropriate practice being the touchstone as follows: 

“The problem is that the concept is significantly wider than the concept of excessive servicing. It goes both into the manner in which professional medical services are actually provided and the actual medical services provided, rather than regulation of the number of services provided, or administrative incidents of medical practice. It affects the practitioner’s clinical decision as to whether to provide a particular service. This feature alone distinguishes the present system from the former system.” 

Robinson went on to explain how “the sampling provision can give rise to manifest unfairness” and described the process as “largely a silly exercise because a very busy general practitioner ordinarily cannot remember an individual consultation that occurred several years ago before a quasi-judicial panel of three general practitioners”. 

Today, when I discuss Medicare and the PSR with my legal colleagues who work in the area, we all agree that the PSR is a Star Chamber, and MBS items and so-called “rules” are hopelessly vague. Even a lawyer from within the PSR quite recently said to me that they are always pleading with the DoH to draft item descriptions clearly. I’d say they’re not having much luck there! 

In addition to the interpretive nature of the whole MBS system, there has been so much law bolted on to the original Medicare scheme over several decades, that it is no longer all in one place, and is sometimes quite difficult to find, let alone interpret. On the weekend a legal colleague sent me this message: “Quick question…where exactly can I find the legislative amendments that bring into effect the 30/20 rule for telehealth in July? Thanks.” I sent him the link, and he was both surprised and grateful, because he had been searching for ages. Of note, he is familiar with this area of law so should not have needed to ask for help. But with Medicare regulation in such a mess, even your lawyers who work in this area can’t always find the law that applies to you, and that creates problems.  

Mr Robinson’s address concluded with this: “In light of all the above, who would want to practice as a doctor…in this country?” 

I hope you do continue to want to work as a doctor in this country, but there can be no denying that the regulatory storm encircling you has become very challenging.  

I also hope that as more of my legal colleagues become skilled in this area, we can collectively do better for you, and advocate for necessary law reform to make Medicare audit anxiety a thing of the past.