Medicare debt recovery: what does this mean for you?

16 November 2018 | Clinic Owners and Practice Managers | 3 minutes read

Medicare debt recovery: what does this mean for you?

Medicare has now been given new legislative powers around recovering  Medicare debt from Doctors and Practices under the new Shared Debt Recovery Scheme.  Last month, the industry experience chaos as Medicare rejected provider number applications that did not include the new ABN requirements. It would have been nice for Medicare to advise the industry that new forms were being issued as the legislation was passed in July; however, that was not the case.

The Department has stated, ” From 1 July 2018, health practitioners applying for a Medicare provider number from the Department of Human Services are required to supply details about their employer or contracting organization.”

What does the new Medicare debt recovery really mean to your clinic and why you should not provide your practice ABN?

We have put together a list of the most frequently asked questions about this new legislation.

Why has this been introduced?

The purpose of this amendment to the Health Insurance Act 1973 is to ensure that where a contractual arrangement exists, debt is mutually shared between the practitioner and the practice. The Act ensures that although the practitioner is responsible for their billings, the practice also has the responsibility to ensure their practitioners are billing responsibly. We believe this legislation is mainly aimed at corporate organisations.

What does this give Medicare the power to do?

This amendment gives the Department of Health increased power to recover Medicare debts from the debtor’s bank accounts after all appeals are used. Previously, a GP in debt has had the right to offset or deduct the debt from amounts payable to a provider or pharmacy, however, this has now been abolished

Do these new rules apply to existing debts?

Yes, the new amendment covers both new and existing debts.

Will there be more changes?

Potentially, the Department has advised that they are working on implementing the new changes and that there will be ‘further’ consultation with stakeholders over the coming months

What can you do to protect your practice?

  • Ensure that you have an easy dialogue with your doctors and work collaboratively to ensure billings are claimed correctly. We hope that the Medicare debt recovery powers do not have an impact on clinical autonomy.
  • Ensure clinical notes are adequate to explain the reasons for billing certain items – the department can issue a Notice to Produce which requires you to produce documents relating to items claimed if these are not provided within a particular timeframe your practice could receive a large fine
  • Ensure you keep updated with any new requirements released by the Department
  • keep a copy of any document created to claim an MBS Item such a CDM plans for two years from the date of service

As a company that assists with Medicare applications, what do we advise?

Alecto recommends always putting the practitioners ABN on Medicare forms and not the ABN of the practice in an attempt to protect your practice from any potential action.

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