- On July 11, 2019
- July / August 2019
Principal - Meridian Lawyers
The Shared Debt Recovery Scheme acknowledges the responsibility of both medical practitioners and the organisation they work under to ensure claims submitted to Medicare are not false or misleading.
The Shared Debt Recovery Scheme (the Scheme) commences on 1 July 2019 and applies to services provided from 1 July 2018. The Scheme enables the Commonwealth Government to recover repayment of Medicare compliance debts from both a medical practitioner and another party (such as a medical practice), as a result of incorrectly claimed Medicare benefits. The Government will do so by making a shared debt determination.
The Scheme recognises that Medicare billing may be delegated to others and administered through a billing process influenced by organisational policies. In some cases, this may contribute to incorrect claiming of Medicare benefits. Medical practitioners remain responsible for services billed under their provider number. At the same time, this Scheme acknowledges that organisations undertaking billing on behalf of medical practitioners also have an obligation to ensure that claims submitted to Medicare are not false or misleading based on the information available to them.
The Scheme applies in relation to the Medicare compliance audit process. If a medical practitioner under audit informs the Department that they are in an employment, contractual or other relevant relationship with another party and requests consideration of a shared debt, the Department will contact the other party. Documents may be sought from both parties in relation to the debt, the contractual arrangement and other documents relevant to determining whether to share a potential debt. Before making a shared debt determination, the Department will provide written notice to each party that it is considering making a shared debt determination, including the amount of the debt, the proportion of the debt that will be recovered from each party and the reasons, and share any documents provided in relation to the debt. Each party can make submissions in reply before the Department makes its decision.
In order for a shared debt determination to be made, the following three criteria must apply:
- There is a debt recoverable as a result of the making of a false or misleading statement;
- There is a relationship between the medical practitioner and the organisation; and
- The organisation could have controlled or influenced the making of the false or misleading statement, obtained a direct or indirect financial benefit from the making of the false or misleading statement, and/or there are other factors that make it fair and reasonable for a shared debt determination to be made.
The Scheme does not apply in the following circumstances:
- claims adjustments that occur routinely as part of medical practice, where a medical practitioner alerts the Department of Human Services to an error to correct the claims record;
- a voluntary acknowledgement by a practitioner of incorrect payments such as after receiving a letter asking them to review their billing or following a targeted campaign;
- debts arising as a result of inappropriate practice following referral to the Professional Services Review;
- debts arising as a result of a false or misleading statement which can be shown to have been made by someone other than the medical practitioner; or
- debts arising where one party has, without knowledge of the other, engaged in fraudulent conduct in relation to Medicare claims or billing.
How will debts be apportioned?
The Department has prescribed a default percentage that may be applied: 65% to the medical practitioner and 35% to the medical practice or other organisation. That said, the Department will consider whether in the circumstances it would be fair and reasonable to set a different percentage based on:
- the arrangements between the parties for apportioning the benefits paid;
- the proportion of the benefits paid for the services were received by medical practitioner and the organisation; and
- the influence or control the organisation may have had over the billing for the services under audit.
The Department is not bound to any terms or conditions in a contract between the medical practitioner and the organisation where they are providing the services including those that would seek to indemnify either party.
What should I do now?
Understand your obligations:
- Review your contractual arrangements;
- Regularly review claims submitted on your behalf by any third party; and
- If you are contacted by the Department, seek professional advice.