Section 01 Introduction
Letter of transmittal
Senator the Hon Chris Ellison
Minister for Human Services
Parliament House
CANBERRA ACT 2600
Dear Minister
It is my pleasure to present Medicare Australia’s Annual Report for 2006–07 as required by section
70(1) of the Public Service Act 1999 for tabling in Parliament.
This report has been prepared in accordance with the Requirements for Annual Reports, approved on
behalf of the Parliament by the Joint Committee of Public Accounts and Audit as required under
section 70(2) of the Public Service Act 1999.
Yours sincerely
Catherine Argall PSM
28 September 2007
Chief Executive Officer’s review
At a time where our key message has been ‘Medicare Australia is changing’, flagging our intention to
leverage our great brand for greater public convenience, we have had a highly successful and
productive year. While maintaining our focus on our traditional health related programs, we are
becoming involved in other areas of service delivery, as our traditional business is increasingly
moving to electronic services.
In addition to delivering major government programs such as Medicare, the Pharmaceutical Benefits
Scheme and payments for aged care providers, Medicare Australia implemented a range of new
government initiatives. Family Assistance services are now available through all Medicare offices and
applications for the Australian Government’s LPG vehicle rebate can also be lodged at a Medicare
office.
Medicare Easyclaim has been a major priority for the organisation. Medicare Australia has proved its
responsiveness, with the delivery of this additional electronic service. Our systems and technical
infrastructure were in place by April 2007, more than three months ahead of schedule.
The success of Medicare Easyclaim to date is the result of the substantial efforts we have made in
working with banks, listening to stakeholders and supporting our people. Medical practitioners now
have a choice of electronic channels to use to make Medicare claims. We continue to work
cooperatively with all peak medical groups, suppliers and across government to deliver greater
convenience to the Australian public in accessing Medicare. This will be a key focus for the coming
year.
The take-up of PBS Online is an impressive achievement for Medicare Australia. We successfully
partnered with the Pharmacy Guild of Australia and the software industry to encourage and support
pharmacies to sign up to online claiming. There were 4 490 pharmacies registered for PBS Online at
30 June 2007.
Medicare Australia continues to work closely with the Department of Human Services to progress the
development and implementation of the access card initiative. We are well advanced in ensuring that
our organisation is able to seamlessly transition to the use of the access card across the broad range
of programs we administer including Medicare and PBS.
More and more Australians are choosing to deal with Medicare Australia online. We now have more
online services offering greater choice and convenience for people to do business with us. This is a
clear demonstration that Australians trust us.
In March 2007, we added our latest online service—the ability to view and print Medicare benefit tax
statements online—in addition to our real-time update of the Australian Taxation Office’s e-tax
product.
At 30 June 2007, over 216 000 people were registered for Online Services, compared to 33 774
people registered the previous year. This year we successfully processed 516 549 online service
transactions, including over 132 000 downloads to e-tax. People dealing with Medicare Australia
And the Australian Taxation Office now enjoys greater convenience in the way they do business with
government. The service also reduces the need for the printing and mailing of statements.
The Family Assistance service offer is a huge success story for Medicare Australia. The rollout of
extended Family Assistance services to all 238 Medicare offices was completed in November 2006,
eight weeks ahead of schedule.
In 2006–07, nearly 540 000 people received face-to-face Family Assistance services through
Medicare offices. In December 2006, 97 per cent of respondents to a feedback survey told us they
were satisfied with our service. We see this service offering as a strong part of our future.
We are a leader in service delivery on many fronts. We are achieving great things by working in
partnership with the public, providers, our policy and business partners and our people.
Medicare Australia cares about convenience for the Australian community. As an agency with one of
the largest footprints in the community, we have a strong reputation for performance in service
delivery. This year we achieved certification in the International Customer Service Standard for the
third year in a row.
Our stakeholder satisfaction levels remain very high. The results from recent research continue to be
positive, with high levels of satisfaction across all sectors ranging from 87 per cent to 96 per cent
satisfaction with Medicare Australia. The most notable results were the increase in practitioner
satisfaction, from 71 per cent in 2006 to 89 per cent in 2007 and the increase in practice manager
satisfaction, which rose from 86 per cent in 2006 to 95 per cent in 2007. Public satisfaction was 90
per cent with an increase of 27 per cent in the very satisfied category.
Given the amount of change facing Medicare Australia, one of the most pleasing results in 2006–07
was the increase in our overall staff satisfaction results. Our staff see a strong connection between
what they do and the value we provide to the Australian public. More than 79 per cent of our people
are satisfied with Medicare Australia as an employer. This is an increase of over seven per cent from
the results in 2005–06. The increased satisfaction result is a tribute to the dedication and commitment
of all our people.
In addition to the increased satisfaction result, Medicare Australia won two major awards in the
Customer Service Institute of Australia’s 2006–07 Australian Service Excellence Awards. Medicare
Australia was a finalist in three categories – National Service Charter, Large Business (Medicare
Office Network) and Call Centre (Queensland). We won the National Service Charter and Large
Business categories.
Financial performance has been a key focus area for Medicare Australia for the past three years. I am
proud to report that we have achieved a real turnaround in our financial performance by exercising
strong financial discipline. This year, Medicare Australia recorded a surplus of $2.3 million.
This is an improvement on the previous year, when we reported a loss of $6.8 million. Compliance
activities are an important part of achieving community confidence. Medicare Australia’s focus in
2006–07 has been on reviewing the legislative, governance and resourcing framework supporting
compliance activities and identifying opportunities for improvements. In 2006–07, this has resulted in
a 32 per cent increase in the number of completed investigation cases into potential fraud committed
against Medicare Australia’s administered payments and a 24 per cent increase in the number of
completed reviews into potential inappropriate practice by medical practitioners. Referrals of cases to
the Commonwealth Director of Public Prosecutions and the Director of Professional Services Review
have also increased.
Closer working relationships have been developed with the Department of Health and Ageing, the
Commonwealth Director of Public Prosecutions and the Director of Professional Services Review.
These relationships have helped to improve communications with health professionals and the
outcomes of our compliance activities. In November 2006, Medicare Australia’s Corporate
Management Committee endorsed the National Indigenous Strategy. The strategy was developed to
provide a blueprint for the next three years of Medicare Australia’s actions to improve Indigenous
access to our programs and services.
Since the establishment of the National Bowel Cancer Screening Register in August 2006, Medicare
Australia has sent more than 405 000 invitations to participate in the screening, to eligible Australians
in all states and territories. We have received positive feedback from a number of participants who
strongly support the program. We have also received thanks from some participants whose test
results were positive, indicating a possible problem to which they might not have been alerted had
they not participated in the program.
One of the key challenges ahead for Medicare Australia is to promote the take-up of electronic
Medicare claiming at doctors’ surgeries. A major focus for 2007–08 will be to execute contracts with
more financial institutions to deliver Medicare Easyclaim, in order to increase the availability of this
claiming choice. Medicare Australia will also be working closely with medical practices to enhance
understanding of electronic claiming choices and on how each option, or a combination, can fi t their
business needs.
Medicare Australia is actively identifying and responding to challenges arising from changes taking
shape in the health system. These include impacts from eBusiness, growth in types of services and
providers, community demand for services beyond medical needs, identity crime and the increasing
complexity in how medicines are prescribed and medical services are provided.
These challenges create opportunity and pressure in the system for non-compliance, which generally
takes the form of incorrect claiming or inappropriate practice. As a result, the National Compliance
Program for 2007–08 has been developed to deal with these areas of potential non-compliance.
The coming year will be challenging, as we focus on business transformation in response to the
changing nature of our service delivery. We will strive to build on our great reputation to ensure the
community’s continuing confidence in Medicare Australia. We will be agile and flexible in our delivery
of services for government and the community.
Catherine Argall PSM
Chief Executive Officer
Section 02
About Medicare Australia
Medicare Australia touches the lives of all Australians. We play a vital role in delivering a wide range
of services on behalf of the government to the Australian public.
The programs we administered during 2006–07 included Medicare, the Pharmaceutical Benefits
Scheme (PBS), the Australian Childhood Immunisation Register, the 30% Rebate on Private Health
Insurance, the Bowel Cancer Screening Register and the Australian Organ Donor Register. These
programs demonstrate our strong presence in the Australian community.
Medicare Australia also plays an integral role in the Australian health sector by administering a wide
range of health-related programs, such as aged care payments, the Practice Incentives Program, the
General Practice Immunisation Incentive Scheme, the Rural Retention Program and the Training for
Rural and Remote Procedural GPs Program. Medicare Australia is also changing. While maintaining
our focus on our traditional health-related programs, we are becoming increasingly involved in other
areas of service delivery. Family Assistance services are now available through all Medicare offices
and applications for the Government’s LPG Vehicle Scheme rebate can also be lodged at a Medicare
office. Medicare Australia has heard what all Australians want from us.
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“Make it easy for me”
“Get it right”
“Be genuinely interested in me”
“Respect my rights”.
Medicare Australia cares about choice and convenience for the Australian public. All aspects of our
service delivery are tested against the community ‘wants’. We listen when people tell us what they
really want from us. Every staff member takes pride in providing friendly, timely and accurate service,
protecting the privacy of the personal information we hold and making the experience of the public
and health providers positive. Medicare Australia sits within the Human Services portfolio, under the
responsibility of the Minister for Human Services, Senator the Hon Chris Ellison. We work together
with health care providers, peak health bodies, external stakeholders and other agencies within the
portfolio.
Our purpose is ‘working together to improve the health and wellbeing of Australians by delivering
information and payment services’.
Medicare Australia is a prescribed agency under the Financial Management and Accountability Act
1997 and a statutory agency under the Public Service Act 1999.
We administer programs on behalf of the Department of Health and Ageing (DoHA), the Department
of Veterans’ Affairs (DVA), the Department of Families, Community Services and Indigenous Affairs
(FaCSIA), the Department of Industry, Tourism and Resources (DITR) and the Department of Health,
Western Australia. Section 4 of this annual report has further information about our role and
performance for these programs.
Each year, Medicare Australia processes around 500 million transactions and pays more than $30
billion in benefits and payments to the Australian public and health care providers.
The government expects Medicare Australia to protect the integrity of the programs it administers. An
important part of this role is ensuring that the right person gets the right payment at the right time.
We actively support and promote a system of voluntary compliance through a range of education
programs aimed both at the public and health care providers. We use a range of strategies to identify,
monitor and change non-compliant behaviour, escalating to rigorous pursuit of deliberate noncompliance and fraud.
Medicare Australia uses a range of communication tools to inform the public, health care providers
and our stakeholders about our services and programs. Medicare offices and Access Point booths
enable us to communicate with the Australian public through posters, brochures and flyers.
Information our service officers receive, through face-to-face interactions, also allows us to target our
communications.
As the need arises, we use media liaison and paid media advertising to communicate information
about specific programs and services. Pharmacies and doctors’ surgeries carry Medicare brochures
and our website also carries a wide range of information.
Human Services Portfolio
Overview
In October 2004, the Department of Human Services was established within the Finance and
Administration Portfolio. In January 2007, the Department became an
Australian Government portfolio department in its own right. Its primary role is improving the
development and delivery of government social and health related services to the Australian people.
The Minister
The Minister for Human Services is Senator the Hon Chris Ellison, who has been a senator for
Western Australia since 1993 and Minister for Human Services since 9 March 2007.
The Minister is responsible for the administration of the following legislation:

Australian Hearing Services Act 1991, except to the extent that it is administered by the Minister
for Health and Ageing insofar as it relates to the exercise of the powers and functions conferred
on the Child Support Registrar under the Act

Child Support (Assessment) Act 1989, insofar as it relates to the exercise of the powers and
functions conferred on the Child Support Registrar under the Act

Child Support (Registration and Collection) Act 1988, Insofar as it relates to the appointment of
the Registrar and the exercise of the powers and functions conferred on the Child Support
Registrar under the Act
Commonwealth Services Delivery Agency Act 1997
Medicare Australia Act 1973.
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During the reporting period, the position of Minister For Human Services was also held by The Hon
Joe Hockey MP (to January 2007) and the then Senator the Hon Ian Campbell (to March 2007).
Portfolio structure
1. The Portfolio Department of Human Services (DHS) includes the Core Department, the Child
Support Agency (CSA) and CRS Australia:
 the Core Department directs, coordinates and brokers improvements to service delivery across
Human Services agencies
 the Child Support Agency helps separated parents transfer payments for the benefit of their
children
 CRS Australia provides vocational rehabilitation services to people with a disability, injury or
health condition, and helps employers keep their workplaces safe.
2. Centrelink delivers a range of government payments and services for retirees, families, carers,
parents, people who are seeking work or studying, people with disabilities, Indigenous people, and
people from culturally and linguistically diverse backgrounds, and provides wider services at times
of major change.
3. Medicare Australia administers a range of health and payment programmes, including Medicare,
the Pharmaceutical Benefits Scheme, the Australian Organ Donor Register, the Australian
Childhood Immunisation Register and aged care payments to approved aged care providers.
Medicare Australia also delivers Family Assistance services.
4. Australian Hearing provides a range of hearing services for a broad group of eligible Australians,
including children and young people up to the age of 21 years, eligible adults and aged
pensioners, and war veterans.
5. The HSA Group focuses primarily on providing occupational health, safety and medical
assessments.
Performance information for outcome
Outcomes and outputs
Medicare Australia has one outcome This is achieved through one output.
Outcome 1: Improving Australia’s health through payments and information.
Output Group 1.1: Delivery of Australian Government health payments and information.
Performance information for Outcome 1
Medicare Australia’s business performance is guided by the themes articulated in the Medicare
Australia Strategic Direction Statement.
Table 1 – Performance information for Outcome 1
Strategic Themes
Key Performance Indicator
Business Performance
Delivering great customer
service
Client and provider satisfaction
with the services provided by
Medicare Australia.
2006–07 Satisfaction research
results
Initiatives are implemented on
time, within budget and to
expectations.
Community – 90%
Pharmacists – 87%
Practice Managers – 95%
Practitioner – 89%
Aged care providers – 96%
Medicare Australia continues to
work closely with our strategic
partners to provide advice and
guidance and to implement new
policy and government
initiatives in accordance with
agreed schedules. We continue
to deliver services on behalf of
other agencies in line with
agreed Key Performance
Indicators.
Providing accurate and reliable
information and payments
Payments are accurate and
timely.
Medicare Australia achieved
96% of claims within stipulated
Strategic Themes
Key Performance Indicator
Business Performance
Staff awareness and
procedures protect Customers
privacy
payment times against a target
of 90%. Accuracy of payments
for Medicare was 97.8% (target
97.8%) and 98.4% (target
97.6%) for PBS.
There is a strong culture in
Medicare Australia of
maintaining our reputation as a
reliable custodian and protector
of private information. This was
identified as the number one
priority for Medicare staff in the
2006–07 staff survey. We
continue to foster this culture
through a number of measures
including mandatory privacy
training for all staff.
Being a well run organisation
Ensuring the integrity of the
government programs we
deliver
Resources are managed in
accordance with the
requirements of the Financial
Management and
Accountability Act and to the
financial plan. A sound
governance framework is in
place.
Education and compliance
programs minimise system
leakage.
Payments are accurate and
timely.
Medicare Australia achieved an
operating surplus of $2.3 million
in 2006–07, demonstrating a
strong financial management
framework.
Medicare Australia has a range
of structures in place to ensure
that our governance is strong.
The primary governance
committee is the Corporate
Management Committee, which
is supported by five
subcommittees covering
customer service, people,
security and eBusiness and
technology.
In 2006–07 we developed a
range of new approaches in
managing compliance across
the programs we administer
including:
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the introduction of new risk
analysis tools

the introduction of a new
streamlined Practitioner
Review Program

an increase in the visibility
of the compliance program
Strategic Themes
Key Performance Indicator
Business Performance

Being a valued strategic
partner in delivering agreed
health and other government
initiatives
Being a great place to work
an improvement in the
productivity of compliance
operations
Strategic partners including the
Department of Health,
Veterans’ Affairs, Families,
Community Services and
Indigenous Affairs and Human
Services are satisfied with
Medicare Australia’s
performance. Government
initiatives are implemented on
time, within budget and to
expectations.
Medicare Australia has current
Service Level Agreements with
DVA, FaCSIA, DIAC, DITR and
the Department of Health in
Western Australia. A new
Memorandum of Understanding
is expected to be finalised with
DoHA shortly, while its intent
and governance framework is
already in place.
Feedback gained through staff
survey is acted on. Staffs have
access to development
opportunities and participate in
individual performance
assessments and absenteeism
is reduced.
The response rate for Medicare
Australia’s 2006–07 staff
survey increased by 1% to
91.8% with 78.9% of staff
indicating that they experience
job satisfaction at Medicare
Australia. This is up 7.9% on
the 2005–06 staff survey result.
Medicare Australia has made a
significant achievement in
reducing absenteeism. Average
unplanned leave was 12.17
days per FTE at 30 June 2007,
down from 12.91 days per FTE
at June 2006.
Our structure
Medicare Australia’s structure is designed to support our strategic direction and the achievement of
our outcome of improving Australia’s health through payments and information.
During 2006–07, Medicare Australia’s executive management team consisted of the Chief Executive
Officer (CEO), three deputy CEOs, five general managers and the Chief Financial Officer.
Our national office is in Canberra and each state has a headquarters located in the state capital,
responsible for day-to-day operations. State managers are responsible for Medicare offices, contact
centres and payment processing centres in each state. To cater for Australia’s highly dispersed
population, there are nine payment processing centres and a network of 238 community-based
Medicare offices.
The main functions of Medicare Australia’s national office include the following divisions and
branches.
Customer Services Division
The Customer Services Division supports the core business of making payments and collecting and
providing information. Services and products delivered by the division support customer service
officers to do their jobs and meet or exceed customer expectations. The division also provides
mainframe and other business system support, training and information tools.
The state infrastructure, which is supported by the division, is responsible for day-to-day operations
and service delivery.
In May 2007, the Customer Services Division was restructured to better meet the changing
requirements of the organisation and to continue to meet increasing customer expectations. A new
branch, the National Operations and Performance Branch, was created. Its primary objective is to
ensure nationally consistent, effective and efficient performance through Medicare Australia’s service
delivery network.
The new branch complements the existing two branches in the division: the Business Analysis and
Support Branch and the Customer Service Strategy Branch.
eBusiness and Development Division
The eBusiness and Development Division’s function is to focus strategically on improving the
effectiveness of service delivery through the development and delivery of Medicare Australia’s
eBusiness initiatives.
The core business activities of the division include driving the take-up of online claiming, developing
new online services and managing our website.
Financial Management Division
The Financial Management Division comprises the Financial Control and Development Branch, the
Budget and Management Accounting Branch and the National Corporate Services Branch.
The division provides Medicare Australia’s budgeting and financial management and reporting
functions, as well as purchasing, property and office services, security and records management.
Information Technology Services Division
The Information Technology Services Division provides and manages information technology (IT)
services, including system applications and works closely with all areas to maximise our internal and
outsourced IT resources.
The division ensures that infrastructure services support our business requirements. The division also
researches and assesses IT-related technologies, tools and processes to increase Medicare
Australia’s capability.
Program Management Division
The Program Management Division comprises the Medicare and Veterans’ Affairs Processing
Branch, the Pharmaceutical Benefits Branch, the Associate Government Programs Branch and the
Aged Care Branch.
The Program Management Division manages the development and implementation of operational
policy across a wide range of programs and related activities.
In 2006–07, this included more than 20 programs, such as Medicare, the Pharmaceutical
Benefits Scheme, aged care payments, the Australian Childhood Immunisation Register, the National
Bowel Cancer Screening Register, the Rural Retention Program, payments on behalf of the
Department of Veterans’ Affairs, hearing services and the LPG Vehicle Scheme. The division
monitored the performance of each program, developing administrative policy for existing programs
and for proposed Australian Government initiatives. The Division provides the relationship
management ‘gateway’ to our policy departments.
During 2006–07, the Aged Care Branch moved from the eBusiness Division to the Program
Management Division to better align with Medicare Australia’s other program responsibilities.
Program Review Division
The Program Review Division’s role is to ensure the integrity of the programs we administer. It does
this through a range of activities to detect and prevent fraud and inappropriate claiming. The division
also promotes and encourages compliance with Medicare
Australia’s programs by providing the community and health care providers with high quality
information products. The division is made up of the Professional Review and Education Branch, the
Compliance Risk and Systems Branch, the Compliance Policy and Standards Branch and the
National Compliance Operations Branch.
The National Compliance Operations Branch has regional offices in all state capital cities, except
Darwin. Northern Territory matters are managed through our Adelaide office.
Access Card Division
The Access Card Division works across Medicare Australia to ensure our organisation is well
prepared for the access card and that our service delivery experience is contributing to the ongoing
development of the access card program.
Legal, Privacy and Information Services Branch
The Legal, Privacy and Information Services Branch support the organisation by providing
comprehensive legal advice on Medicare Australia programs, projects and human resource
management issues.
The branch ensures that we meet our statutory Freedom of Information and release of information
obligations and comply with relevant privacy legislation. The branch also provides statistical analyses
for the programs that we administer and mailouts on behalf of customers.
Human Resources Branch
The key role of the Human Resources Branch and the state based human resources teams is to
support staff and management through developing and implementing quality people management
practices and initiatives
Media, Communication and Government Relations Branch
The Media, Communication and Government Relations Branch works with a broad range of internal
and external stakeholders to produce and provide high quality information and communication
products through a range of print, media and other information services.
The branch focuses on providing high level and timely communication support to the Minister, DHS
and the government, health care providers, the Australian public and Medicare Australia staff.
Audit and Risk Assurance Services Branch
The Audit and Risk Assurance Services Branch provides independent and objective assurance on the
adequacy and effectiveness of Medicare
Australia’s internal control framework. The branch also supports the Audit Committee’s review of our
risk management and fraud control activities and the implementation of audit recommendations by
management.
The following page shows our senior executive management structure at 30 June 2007.
Figure 1 – Organisation Chart
Our relationship with other agencies
Medicare Australia delivers services on behalf of DoHA, DVA, DITR and FaCSIA. We remain focused
on the delivery of services to all Australians on behalf of our external stakeholders. We consult
industry peak bodies and health practitioners to ensure that the government’s policy objectives are
effectively realised, while also considering the needs of health practitioners and the public.
Medicare Australia works closely with DHS and its agencies to seek synergies, where possible, and
to achieve the most cost effective outcomes.
Our activities are conducted within the Australian Government policy framework set by legislation
administered by DoHA, DVA, DITR and FaCSIA. We actively contribute to policy development by
providing information and feedback from our day-to-day operations.
Medicare Australia delivers services on behalf of DoHA, DVA, DITR and FaCSIA. We remain focused
on the delivery of services to all Australians on behalf of our external stakeholders. We consult
industry peak bodies and health practitioners to ensure that the government’s policy objectives are
effectively realised, while also considering the needs of health practitioners and the public.
Medicare Australia works closely with DHS and its agencies to seek synergies, where possible, and
to achieve the most cost effective outcomes.
Our activities are conducted within the Australian Government policy framework set by legislation
administered by DoHA, DVA, DITR and FaCSIA. We actively contribute to policy development by
providing information and feedback from our day-to-day operations.
Our funding arrangements
Medicare Australia is part of the Human Services Portfolio and reports to the Minister for Human
Services.
The organisation is funded mainly by direct appropriation through the annual budget cycle. In
addition, Medicare Australia is funded for and performs a number of services under purchaser
provider arrangements with other Australian Government agencies.
Medicare Australia is also funded for services performed under contract with other entities, including
the Western Australian Government and for some services on behalf of the World Bank.
Resourcing for Outcome 1 includes direct appropriations from government, revenue from other
government agencies and cost recovered funds.
The chart below shows the main sources of funding for Medicare Australia in 2006–07.
Figure 2 – 2006–07 Revenue
Direct appropriation
Funding for health programs, which make up a significant portion of Medicare Australia’s operations,
comes from direct appropriation. Our funding agreement with the government includes both fixed and
variable amounts. The variable component is determined by the number of services and payments
processed in any financial year. The revenue paid to Medicare Australia under this arrangement was
$554.4 million in 2006–07 and is estimated to increase to $586 million in 2007–08. The estimate may
change as a result of significant volume changes or new policy proposals approved in the budget
context.
This direct appropriation funding also includes revenue for the LPG Vehicle Scheme (a DITR
initiative). This is a fixed funding arrangement for which we received revenue of $0.7 million in 2006–
07 (2007–08 estimates: $0.9 million).
Department of Health and Ageing
Medicare Australia provides a range of additional services to DoHA under business practice
agreements. The services provided are the administration of the aged care payments function, the
Broadband for Health Incentive Payments Scheme (General Practice and Pharmacy) and the
National Bowel Cancer Screening Register.
Under these arrangements we received revenue of $27.2 million in 2006–07 (2007–08 estimate:$17.6
million).
Department of Veterans’ Affairs
Medicare Australia provides services to DVA through a service level agreement. We process claims
for veterans’ treatments, including medical, hospital and allied health services. As with health outputs,
the pricing structure for DVA services is based on a variable price per processed service, with fixed
revenue covering related infrastructure costs. Revenue received under the service level agreement in
2006–07 was $16.7 million (2007–08 estimates: $17.6 million).
Department of Families, Community Services and Indigenous
Affairs/Centrelink
Medicare Australia provides Family Assistance services through the Medicare branch office network
on behalf of FaCSIA. Revenue from this program includes a fixed amount from FaCSIA and a
variable amount from Centrelink.In 2006–07; we received $8.6 million from FaCSIA (fixed) under this
arrangement. We also received $11.1 million (variable) from Centrelink (2007–08 estimates: $14.0
million).
Department of Health, Western Australia
Through an agreement with the Department of Health, Western Australia, Medicare Australia
administers a visiting medical practitioner fee-for-service payment and information system. This
system provides public non-teaching hospitals in Western Australia with an intranet processing
system to assess and pay invoices submitted by visiting medical practitioners providing services to
public patients. Under the agreement, funding for 2006–07 was $1.2 million (2007–08 estimates: $1.2
million).
Other sources of funding
Costs are recovered for various consultancy works, usually negotiated with overseas governments
and non-governmental organisations. Medicare Australia also recovers costs for the provision of
statistical information and accommodation space in sub-lease arrangements.
Summary of key performance statistics, 2006–07
Note: Financial and other data in this annual report has been rounded to the nearest decimal point.
This may lead to some discrepancies in the total figures.
On behalf of the Department of Health and Ageing
Medicare
Persons enrolled in Medicare* at 30 June 2007
21.1 million
Active Medicare cards at 30 June 2007
11.8 million
Bulk billed services
187.9 million
Patient claimed services
70.0 million
Total services processed
257.9 million
Percentage of services bulk billed
72.9%
Total benefits paid
$11.8 billion
* includes some people who are not Australian residents (such as long-term visitors for more than six
months and eligible short-term visitors).
Pharmaceutical Benefits Scheme and Repatriation Pharmaceutical Benefits Scheme
(Payments to veterans processed by Medicare Australia on behalf of DVA)
PBS services processed**
168.3 million
RPBS services processed
14.8 million
Total services processed
183.1 million
PBS benefits paid
$6.0 billion
RPBS benefits paid
$449.5 million
Total benefits paid
$6.5 billion
Authority prescriptions authorised
7.3 million
** including stoma
Aged Care
Residential claims processed
34 832
Community Aged Care Package claims
processed
12 219
Flexible care claims processed
3 456
Total claims processed
50 507
Total amount paid
$6.3 billion
Australian Childhood Immunisation Register
Valid immunisation episodes recorded
3.9 million
Children (under 7) registered
1.9 million
Total amount paid to immunisation providers
$8.4 million
Children registered with appropriate
immunisation coverage
aged 12–15 months
91.2%
aged 24–27 months
92.5%
aged 72–75 months
87.9%
Australian Organ Donor Register
Number of consent registrations (including
registrations of intent by 16–17 year olds)
Practice Incentives Program
951 417
Participating practices
4 784
Total amount paid
$279.1 million
Rural Retention Program
Number of providers paid
2 085
Number of payments made
2 110
Total amount paid
$20.4 million
General Practice Immunisation Incentive Scheme
Number of practices registered
5 499
Total payments*
$37.6 million
* includes Service Incentive Payments and Outcomes payments
General Practice Registrars’ Rural Incentive Payments Scheme
Medical practitioners paid
467
Number of payments made
887
Total amount paid
$7.5 million
Training for Rural and Remote Procedural GPs Program
Number of providers paid
2 487
Number of payments made
3 296
Total amount paid
$9.9 million
Compensation Recovery Program
Number of cases finalised
46 561
Total amount of benefits recovered
$29.0 million
HECS Reimbursement Scheme
Eligible medical graduates participating
411
Medical graduates paid
313
Number of payments made
528
Total amount paid
$2.7 million
Hearing Services Program
Services processed
917 208
Total amount paid
$215.3 million
30% Rebate on Private Health Insurance
Memberships registered
5.1 million
Total paid in cash claims
$2.1 million
Total paid to health funds
$3.3 billion
Medicare Australia online claiming
Number of registered sites
7 455
Increase in registered sites
1 507
Number of registered sites transmitting via online
claiming
6 632
Increase in registered sites transmitting via online
claiming
1 263
Bulk bill services submitted via online claiming
59.2 million
Patient claimed services submitted via online claiming
4.4 million
Simplified billing
Simplified billing services lodged via ECLIPSE
157 840
Increase in sites transmitting in-patient claims
via ECLIPSE
70
ECLIPSE = Electronic Claim Lodgement and Information Processing Service Environment
On behalf of the Department of Veterans’ Affairs
Veterans’ Treatment Accounts
PTEC*, STEC**, RPBC*** and TPIG**** cards
produced
173 090
Provider cards produced
3 146
Total services processed
21.8 million
Total benefits paid
$1.9 billion
* Personal Treatment Entitlement Card
** Specific Treatment Entitlement Card
*** Repatriation Pharmaceutical Benefits Card
**** Totally Permanently Incapacitated Gold Card
Before the 2004–05 financial year, Medicare Australia’s funding for the processing of DVA services
was allocated based on the number of lines processed. The output pricing agreement has since
changed and Medicare Australia’s funding is now allocated based on the number of DVA services
processed. Care should be taken when comparing the statistics in this table with those of earlier
years, which used lines instead of services.
Service and benefit figures include incentive items.
On behalf of DITR
LPG Vehicle Scheme
Number of applications received
44 013
Percentage of applications received by Medicare
66.9%
Australia
On behalf of FaCSIA
Family Assistance
Number of Medicare offices offering full service
238
Number of people accessing extended Family
Assistance services
538 160
Section 03: Management and accountability
Corporate governance
The Chief Executive Officer (CEO) of Medicare Australia reports to the Minister for Human Services
through the Secretary of the Department of Human Services (DHS). Section 8AB of the
MedicareAustralia Act 1973 states that the CEO is responsible, under the Minister, for:



deciding the objectives, strategies, policies and priorities of Medicare Australia
managing Medicare Australia
Ensuring that Medicare Australia performs its functions in a proper, efficient and effective manner.
The CEO is supported by an executive management team, consisting of three deputy CEOs, five
general managers and the Chief Financial Officer. Six state managers also support the CEO.
The Minister for Human Services issued the CEO of Medicare Australia with a Statement of
Expectations for the period 1 October 2005 to 30 September 2006 and a further Statement of
Expectations for the period 1 December 2006 to 30 June 2007. These statements set out the
Minister’s priorities and included key deliverables for our ‘strategic themes’ of service delivery for
payments and information and program integrity.
The CEO formally responded to the Minister with Statements of Intent outlining Medicare Australia’s
commitments to meet the Minister’s expectations. Both these documents are available on our
website.
The CEO and other members of the executive management team meet with the Secretary of DHS
and with other DHS staff on a monthly basis to report formally on progress in priority activities.
Internal governance arrangements
The CEO has a range of corporate committees and other arrangements in place to ensure that our
governance is robust and meets the requirements of the Financial Management and Accountability
Act. These arrangements include the Audit Committee and Program Integrity Committee, both of
which have independent members. While the Program Integrity Committee is not a statutory
requirement, the work it does highlights the importance of program integrity to Medicare Australia.
Corporate Management Committee
The primary governance committee in Medicare Australia is the Corporate Management Committee –
its role is to provide strategic advice to the CEO. Its objective is to help the CEO discharge her
obligations to ensure that Medicare Australia:




has appropriate governance frameworks in place
conforms with all legislative requirements
operates effectively to deliver the government’s service delivery objectives
is strategically positioned to meet future requirements.
There are five Corporate Management Committee subcommittees:





customer service
finance
eBusiness and technology
people
security.
During 2006–07, the operations of the subcommittees were reviewed to ensure they provide effective
support and have robust operating procedures to support the Corporate Management Committee.
The outcome of the reviews saw the development of standard operational procedures to improve the
effectiveness of subcommittee operations. There were some minor amendments to the terms of
reference and improved record-keeping arrangements were introduced.
Corporate governance information for staff
Medicare Australia has corporate governance information on its intranet to guide the day-to-day work
of staff.This information includes the Chief Executive Instructions and a range of policy and
procedural documentation.
Delegations
Medicare Australia operates its business in accordance with a number of instruments of delegation.
These include financial and human resource delegations made under a range of legislation, including
the Financial Management and Accountability Act and the Public Service Act 1999.In addition,
delegations are also made under the MedicareAustralia Act 1973 and other relevant health
legislation, including the Health InsuranceAct 1973, the National HealthAct 1953, the Health and
other Services (Compensation) Act 1995, the Private HealthInsurance Incentives Act 1998, the
Medical Indemnity Act2002, the Aged Care Act 1997 and other legislation.
The CEO has made instruments of delegation specific to Medicare Australia officers in respect of
statutory powers that are directly held and in respect of statutory powers that are performed on behalf
of the Minister for Health and Ageing and the Secretary of the Department of Health and Ageing
(DoHA).
External and internal scrutiny
The Audit Committee, chaired by an independent external member, provides independent assurance
and assistance to the CEO in relation to Medicare Australia’s risk, control and compliance framework
and its external accountability obligations. In particular, the committee oversees:


the effectiveness of our internal control framework
the internal audit program, which reviews the adequacy and effectiveness of our operations



our corporate risk management and planning activities
the development of the Fraud Control Plan and implementation of the Fraud Control Action Plan
Our compliance with external accountabilities and obligations, including the preparation of our
annual financial statements.
The Audit Committee has five members: Mr Bruce Jones(chair) and Ms Meryl Stanton(external
members); a Medicare Australia deputy CEO; one state manager; and one branch manager. The
committee met seven times in 2006–07.
The chair of the committee meets regularly with the CEO and the committee as a whole reports
annually to the CEO. Consistent with our commitment to be open and transparent, representatives
from the Australian National Audit Office(ANAO) and DHS are invited to attend Medicare Australia’s
Audit Committee meetings.
In 2006–07, the committee:




increased emphasis on monitoring the implementation of internal and external audit
recommendations
endorsed the internal audit work plan
advised on matters arising from the committee’s consideration of Medicare Australia’s financial
statements and recommended the signing of the financial statements
Maintained awareness of Medicare Australia’s operating environment through regular
presentations and discussions with executive management.
External scrutiny
The Audit and Risk Assurance Services Branch (ARAS) is responsible for liaising with the ANAO and
for providing coordinated responses to draft audit findings and recommendations. Details of ANAO
reports affecting Medicare Australia are provided on the following page.
Australian National Audit Office

During 2006–07, the ANAO tabled in Parliament a number of reports on audits involving
MedicareAustralia.
Cross-agency audits that Medicare Australia was involved in:



Audit Report No.12 2006–2007: Management of Family Tax Benefit Overpayments
Audit Report No.15 2006–2007: Audits of the Financial Statements of Australian Government
Entities for the Period Ended 30 June 2006
Audit Report No.51 2006–07: Interim Phase of the Audit of Financial Statements of General
Government Sector Agencies for the Year Ending 30 June 2007.
Audit of another agency that involved consultation with Medicare Australia:

Audit Report No. 38 2006–2007: Administration of the Community Aged Care Packages Program.
Audits in progress
The following ANAO performance audits affecting Medicare Australia were in progress at 30 June
2007:


Accuracy of Medicare Claims Processing. The audit will examine Medicare Australia’s policies and
procedures to ensure government expenditure on Medicare is appropriately controlled. The audit
report is expected to be tabled in late 2007
National Cervical Screening Program – Follow-up. The audit will focus primarily on DoHA and
actions taken by DoHA and Medicare Australia (Recommendation 3 only) to implement four
recommendations from the original audit conducted in 2000–01. The audit report is expected to be
tabled in late 2007.
Medicare Australia’s Audit Committee maintains scrutiny over the implementation of ANAO
recommendations where they are applicable to Medicare Australia.
Joint Committee of Public Accounts and Audit
On 28 February 2007, the Joint Committee of Public Accounts and Audit conducted a public hearing
in relation to its review of the Auditor-General’s Audit Report No.12 2006–2007: Management of
FamilyTax Benefit Overpayments. Medicare Australia attended the public hearing and gave evidence.
No findings were recorded against Medicare Australia.
Internal scrutiny
The Audit and Risk Assurance Services Branch (ARAS) operates under the authority of a Chief
Executive Instruction and the Audit and Risk Assurance Services Charter. It is directly accountable to
the CEO and Medicare Australia’s Audit Committee. ARAS is responsible for:


the planning and delivery of a risk-based annual internal audit work program to evaluate and
provide assurance on the effectiveness, efficiency and ethical performance of Medicare Australia’s
activities
Providing advice and assistance on risk management and fraud control, including the
development of policies and procedures and the Corporate Risk Management Plan and Corporate
Fraud Control Plan.
Internal control framework
Internal audit evaluates and reports on the performance of management in maintaining our strategic
direction, achieving our operational objectives and ensuring appropriate standards of probity and
accountability.
There is a focus on improving the overall management control framework. In developing the audit
workplan for 2006–07, ARAS considered:








the views of the CEO, the Audit Committee and senior management
Medicare Australia’s risk assessments
recent ARAS and ANAO audit coverage
Medicare Australia’s Fraud Control Plan
the CEO’s requirements to certify compliance with the Financial Management and Accountability
Act 1997
issues raised by the ANAO affecting both Medicare Australia and other agencies
the level of materiality associated with programs or activities
Requirements imposed on Medicare Australia under service agreements with other agencies.
Other major activities included monitoring the progress of the implementation of audit
recommendations, through the development and maintenance of an audit monitoring database and
providing advice to management and staff.
Risk management
Medicare Australia has an integrated risk management framework that includes a Chief Executive
Instruction, policies, guidelines, a planning handbook and reporting templates. These are accessible
to staff through the intranet. Risk management advisers are available to facilitate risk management
education, workshops and report preparation.
The Audit and Risk Assurance Services Branch is responsible for preparing the Corporate Risk
Management Plan and facilitating the executive’s monitoring of the plan. The risk management plans
are subject to quarterly review and updates to ensure that momentum for implementing treatments is
maintained and potential or emerging risks are identified and monitored. Our risk management
framework is consistently reviewed and revised. The business planning and risk management teams
work closely together to ensure risk awareness in decision making at all levels of business planning
and program management.
The risk management unit reports to the Audit Committee and the management of risk across the
organisation is also monitored through the internal audit program.
In June 2007, Medicare Australia achieved a score of eight out of a possible ten in the Comcover
Risk Management Benchmarking Survey. Our achievement entitled us to an eight per cent discount
on our Comcover insurance premium.
Fraud control
As part of its responsibilities to protect the public interest, Medicare Australia has a fraud control
program that complies with the Commonwealth Fraud Control Guidelines.
In this program:


fraud risk assessments and fraud control plans are prepared in accordance with the guidelines
appropriate fraud prevention, detection, investigation and reporting procedures and processes are
in place
annual fraud data is collected and reported in line with the guidelines.

Program integrity assurance
To ensure that Medicare rebates, Pharmaceutical Benefits Scheme (PBS) subsidies and health
related incentives are claimed properly, Medicare Australia has implemented a compliance program.
This National Compliance Program is administered by the Program Review Division. The program
focuses on areas of risk to health programs. The table below summarises compliance activities by the
Program Review Division in managing those risks. Section 4 of this report has further details of the
Program Reviews compliance activities in 2006–07.
Table 2 – Compliance activities
Risk
Detection tools
Compliance activities
1. Claiming for services not provided

non-provision of Medicare
services

top providers and cash
claiming data analyses

non-supply of PBS items

intelligence analysis *

Medicare claims fraud by
patients

tip-offs from the public and
referrals

criminal investigation and
prosecution
2. Identity and related crimes

false or stolen identity



misrepresentation of
concessional entitlement
data and intelligence
analysis
criminal investigation and
prosecution

intelligence and information
sharing with other agencies

referrals to other agencies
(for example, the Australian
Federal Police)
Risk
Detection tools

Compliance activities
tip-offs from the public and
referrals
3. Incorrect claiming or inappropriate servicing

Medicare mis-itemisation

artificial intelligence **

education

or incorrect claiming

audits

targeted feedback

inappropriate prescribing
inappropriate PBS supply
and claiming

top providers data analysis

recoveries

tip-offs from the public and
referrals

compliance interview

Practice Review Program
and referral to the Director
of Professional Services
Review

data and intelligence
analysis

education


targeted feedback
joint operations with the
Australian Customs Service
and Australia Post at
overseas departure and
mail exchange centres

compliance interviews

criminal investigation and
prosecution
4. Oversupply

overseas drug diversion

prescription shopping

tip-offs from the public and
referrals
5. Abusing eligibility for incentives and rebates

non-compliance relating to
incentive payments

artificial intelligence

education


audits

compliance interviews
incorrect claiming of
rebates and other payment
programs

tip-offs from the public and
referrals
* analysis of information specific to a case or person for operational purposes
** predictive computer programs
Financial framework
The Financial Management and Accountability Act 1997 sets out the CEO’s functions and
responsibilities relating to Medicare Australia’s financial management. Medicare Australia has issued
Chief Executive Instructions supported by detailed financial management policies, procedures and
delegations to help staff comply with legislative obligations. These were reviewed and revised during
the year to ensure their continued relevance and effectiveness.
In 2006, the Government introduced a requirement that CEOs provide certification to their responsible
Minister on their agency’s financial management and sustainability by 15 October each year.
During 2006–07, we developed policies and procedures and trained all relevant staff in requirements
for the preparation of the annual Certificate of Compliance.
Financial performance is regularly reviewed both within Medicare Australia and by the Department of
Human Services and the Department of Finance and Administration. Within Medicare Australia,
budget and resourcing decisions are considered by the Finance subcommittee, which reports to the
Corporate Management Committee.
Corporate business continuity
Business disruption could damage Medicare Australia’s ability to deliver services and our reputation if
the speed or scale of an emergency compromised or challenged our operations and management
systems and disabled our services to providers and the public. We use business continuity principles
to ensure that we are prepared to manage emergencies when they occur.
As part of this preparation, our divisions and state offices maintain business continuity plans to
ensure that effective interim operating arrangements can be put in place to support critical business
processes and resources. Medicare Australia tests the business continuity plans regularly and
incorporates experience gained from real emergencies to ensure the effectiveness of the plans.
Medicare Australia introduced a new emergency management and business continuity framework in
2006–07 and completed a series of business continuity tests involving all parts of the organisation.
The tests included annual disaster recovery tests, which ensure that our information technology
infrastructure is robust and recoverable.
Balanced scorecard
During 2006–07, Medicare Australia examined its balanced scorecard and refined key performance
indicators to improve their alignment with corporate and management reports. The indicators in the
scorecard measure a range of financial and non-financial functions against internal targets and
benchmarks and are categorised under six perspectives:






finance
growth and development
service (public and government)
internal business processes
people
social and environmental.
We continue to review and refine our key performance indicators to enable the effective monitoring
ofthe overall health of the organisation. Balanced scorecard measures are summarised in table 3.
Table 3 – Balanced scorecard
Actual
Actual
Target
Actual
2004-05
2005-06
2006-07
2006-07
Revenue
$596.1 m
$577.6 m
$627.5 m
$626.0 m
Operating expense
$593.0 m
$584.5 m
$627.5 m
$623.7 m
Net result
$3.1 m
($6.8 m)
$0.0 m
$2.3 m
Finance
Actual
Actual
Target
Actual
2004-05
2005-06
2006-07
2006-07
Service (public and government)
Community
satisfaction
90%
96%
≥90%
90%
Medical practitioner
satisfaction
85%
71%
≥70%
89%
Practice manager
satisfaction
90%
86%
≥85%
95%
Pharmacist
satisfaction
85%
92%
≥90%
87%
Call centre response
time
93%
91.5%
≥90%
91.9%
Claim processing
accuracy
98%
97.8%
≥97.8%
97.8%
Internal business processes
IT service availability
n/a
n/a
99.9%
99.9%
IT service
performance
n/a
n/a
99.1%
99.9%
Online claiming take9.93%
up – Medicare bulk bill
24.7%
33%
31.5%
Online claiming takeup – Medicare patient
claim
1.8%
5.1%
6%
7.9%
≥1 500
4 490
n/a
n/a
(30%)
(81%)
73%
62%
71%
79%
n/a
n/a
13.33
12.17
Growth and
development
PBS online take-up –
no. and percentage
of participating
pharmacies
People
Overall staff
satisfaction
Unscheduled
absenteeism – leave
rate/FTE
Actual
Actual
Target
Actual
2004-05
2005-06
2006-07
2006-07
Social and
environmental
Due to a change in the reporting process on energy usage at Medicare Australia, results for 2006–
07 will not be available until October 2007. For information about Medicare Australia’s
environmental activities, see ‘Environmental sustainability’ on page 70 in this section.
Our stakeholders
Stakeholder Consultative Group
The Stakeholder Consultative Group consists of members from groups, such as the Australian
Association of Practice Managers, the Australian General Practice Network (formerly the Australian
Divisions of General Practice), the Australian Private Hospitals Association, the Australian Medical
Association, the Pharmacy Guild of Australia, the Medical Software Industry Association and the
Rural Doctors Association of Australia. Meetings with the group give stakeholders an opportunity to
discuss and influence Medicare Australia’s business activities at a strategic level.
The Stakeholder Consultative Group usually meets two to three times a year. During 2006–07, the
group met in December 2006 and March 2007. Key issues raised at the meetings included access
card, PBS Online, electronic Medicare claiming and compliance and reducing fraud.
Consumer Consultative Group
The Consumer Consultative Group meets two or three times a year. Representatives are from
various organizations and community groups such as the Consumers’ Health Forum, Chronic Illness
Australia, Carers Australia and the Australian Federation of Disability Organisations.
Members provide input on issues, discuss the potential impacts of services and products and advise
on how Medicare Australia can add further value in the delivery of services to the Australian public.
The Consumer Consultative Group met in August and November 2006 and March 2007.Key issues
raised at these meetings included electronic Medicare claiming, customer satisfaction research
results and queue management in Medicare offices.
Stakeholder research
Medicare Australia has undertaken annual satisfaction research with the community since 1984 and
with medical professionals since 1991.We use a combination of qualitative and quantitative research
methods to track and evaluate satisfaction levels, including measures aligned to our service charter.
The results and recommendations give us a deeper understanding of the needs and expectations of
the Australian public and providers. We use the results to inform strategic priorities, service delivery,
channel management and communication.
Following the results of the 2005–06 satisfaction research, we conducted a complementary body of
qualitative research in 2006–07 to better understand the changing relationship between Medicare
Australia, practitioners and practice managers. The findings identified areas for improvement in
support, service and communication with medical practices.
As part of Medicare Australia’s commitment to continuous improvement, we revised and adopted a
whole of business approach to research in 2006–07. We communicated the annual satisfaction
research findings widely and integrated them into plans across the organisation. This process
involved extensive consultations, a series of tailored research presentations and workshops with
internal and external stakeholders. We used insights from these activities to modify and refine the
scope and methodology of research in 2006–07.
2006–07 research findings
In 2006–07, surveys were conducted with the Australian public, practitioners (general practitioners,
pathologists, imaging and other specialists, optometrists and ancillary immunisation providers),
practice managers, pharmacists and aged care providers.
Satisfaction among the Australian public has remained strong at 90 per cent and there has been a
significant 27 per cent rise in satisfaction levels from ‘quite satisfied’ to ‘very satisfied’.
There has been an increase in the satisfaction levels of practitioners and practice managers and a
slight decrease in pharmacists’ satisfaction.
Table 4 – Overall stakeholder satisfaction levels 2004–05 to 2006–07
2004-05
2005-06
2006-07
Community
90%
96%
90%
Practitioner
85%
71%
89%
Practice managers
90%
86%
95%
Pharmacists
85%
92%
87%
Aged care providers
n/a
97%
96%
Figure 3 – Stakeholder satisfaction 2002–03 to 2006–07
Service charter
Medicare Australia’s charter includes our service delivery strategy statement to stakeholders.
Delivering great service to all Australians
We listen when you tell us what you really want from Medicare Australia. Every staff member takes
pride in providing friendly, timely and accurate service, protecting your privacy and making your
experience as easy as possible. Our promise is that we will deliver great service to all Australians.
The service charter centres on four key statements from the Australian public, which tell us what they
really want from Medicare Australia.




‘Make it easy for me’
‘Get it right’
‘Be genuinely interested in me’
‘Respect my rights’.
To ensure that we deliver against these statements, the service charter also makes specific promises
in relation to each statement, provides quantitative and qualitative reporting on each promise and
links the customer service focus directly to individual performance agreements.
The charter is provided as a brochure and is supported by more detailed information on our website.
We also publish the measures and performance against the promises in the service charter on the
website. We update this information quarterly.
Make it easy for me
We will improve convenience and access for all Australians by improving a range of service options,
including online.
Measure
Satisfaction with the range of options available to make a Medicare claim
Performance
As shown in the 2006–07 satisfaction survey, 69 per cent of the public were satisfied with the range
of options available.
Measure
New developments in online access
Performance
We have launched a new website design to help the public find our online information and access our
services more easily.
Our Online Services continue to expand and the public can now:






view and update their Medicare details and request a replacement card
register and check their Medicare Safety Net balance
view their organ donor registrations details and their children’s immunisation history statements
view their Medicare tax statement
access information about health and medicines
consent for Medicare Australia to communicate electronically with them in the future.
We will stay open longer in our busiest Medicare offices.
Measure
Number of busy Medicare offices (based on claiming patterns) staying open longer to meet the
public’s needs and demands.
Performance



117 Medicare offices open 9.00 am to 12.30 pm on Saturdays.
193 offices have extended their Monday to Friday opening hours.
54 offices have opened their doors until 6.00 pm and in some offices to 7.00 pm, one evening
each week to coincide with local evening trading.
Measure
Satisfaction with opening hours
Performance
68 per cent of the public were satisfied with the opening hours.
We will keep queue times in Medicare offices to a minimum.
Measure
The Australian public is served in less than 10 minutes.
Performance
In 2006–07, 98.3 per cent of the public waited less than10 minutes in the queue to be served, with an
average waiting time of 2 minutes 14 seconds. Where we do not meet the service standard of 10
minutes, we find out why and make improvements.
We will answer the phone quickly.
Measure
We answer calls within 30 seconds.
Performance
In 2006–07, 92 per cent of calls were answered within 30 seconds.
We will increase awareness of our services among Indigenous Australians.
Measure
Number of Indigenous Australians registered for Medicare.
Performance
Indigenous Australians can voluntarily identify when enrolling for Medicare. At 30 June 2007, there
were 168 706 Medicare enrolments in which the voluntary Indigenous identifier was completed.
Measure
Number of calls made to the dedicated Aboriginal and Torres Strait Islander access line.
Performance
In 2006–07, the dedicated Aboriginal and Torres Strait Islander access line received 48 452 calls.
We will help you access other agencies in the Department of Human Services.
Measure
Access to Family Assistance services
Performance
Family Assistance services have been extended in all 238 Medicare offices.
Measure
Access to Medicare services from Centrelink customer service centres
Performance
Basic Medicare services are offered through 49 Centrelink sites across northern Australia. Nationally,
a further 36 Centrelink agent sites perform an information brokerage service on behalf of Medicare
Australia.
In partnership with Centrelink, we conducted a flexible service delivery arrangement to trial the
provision of Medicare Australia services from four Centrelink sites and the provision of Centrelink
services in four Medicare offices.
Get it right
We will make accurate and timely payments.
Measure
Payments are timely and accurate.
Performance
In 2006–07:







96 per cent of Medicare bulk bill claims were finalised within 15 days
96 per cent of Medicare simplified billing claims were finalised within 10 days
94 per cent of all Medicare patient claims were finalised within 18 days
99 per cent of PBS claims were finalised within 17 days
accuracy of payments for Medicare was 97.8 per cent against a target of 97.8 per cent
accuracy of payments for PBS was 98.4 per cent against a target of 97.6 per cent
Continuous random sampling and compliance audits of Medicare and PBS payments provide
assurance of accuracy of payments and areas for improvement.
We will give you clear and accurate information.
Measure
Satisfaction with information provided.
Performance
77 per cent of the public agreed that they received clear and accurate information.
We will give you consistent advice.
Measure
Satisfaction with advice provided.
Performance
64 per cent of the public agreed they received consistent advice.
Be genuinely interested in me
We will provide service with a smile.
Measure
Satisfaction with the friendly service provided by Medicare Australia staff
Performance
76 per cent of the public agreed that Medicare Australia’s staff provide service with a smile, in an
engaging and friendly manner.
We will listen to your feedback and be responsive to your needs.
Measure
Satisfaction with services and responsiveness to needs by Medicare Australia staff.
Performance
Satisfaction with Medicare Australia’s services was rated as follows:




90 per cent of the public
89 per cent of medical practitioners
95 per cent of medical practice managers
87 per cent of pharmacists.
Measure
An 1800 complaints and feedback line have been established for the public and providers.
Performance
In 2006–07, 680 calls were made to the complaints and feedback line. All have been resolved.
We will respond to your complaints promptly.
Measure
Respond quickly to complaints.
Performance
51 percent of the public agreed that Medicare Australia responded to complaints promptly. Only six
percent disagreed; the remainder were neutral or did not know.
We will acknowledge your feedback within two days and respond to all feedback within14 days.
Measure
We will acknowledge your feedback within two days.
Performance
75 percent of feedback was acknowledged within two days.
Measure
We will respond to all feedback within 14 days.
Performance
77 percent of feedback was responded to within 14 days.
We will treat you with respect and courtesy.
Measure
Satisfaction with respectful and courteous services provided by Medicare Australia staff
Performance
86 percent of the public agreed that Medicare Australia’s staff treated them with respect and courtesy.
Respect my rights
We will respect the privacy and the confidentiality of your personal information.
Measure
We respond to all complaints about the use and disclosure of personal information and publish results
in the annual report.
Performance
We received 92 complaints about the use and disclosure of personal information we hold. Of these
complaints, 38 were found to be not substantiated, 50 were substantiated and appropriate action was
taken. As at 30 June 2007, four complaints were still being assessed. Of the 92 complaints, four were
originally lodged with the Office of the Privacy Commissioner, who referred them to Medicare
Australia for action. One was substantiated and three were not substantiated.
Measure
Satisfaction with Medicare Australia staff respecting the privacy and confidentiality of personal
information
Performance
88 per cent of the public agreed that Medicare Australia respected their privacy.
We will respect your rights to seek a review of our decisions.
Measure
Complaints lodged with the Commonwealth Ombudsman.
Performance
During 2006–07, the Commonwealth Ombudsman received 123 complaints about Medicare Australia,
a decrease of 34 (21.7 per cent) from the previous year.
Certification with the International Customer Service Standard
Medicare Australia first achieved certification with the International Customer Service Standard in
2004 and was awarded with recertification again in 2005 and 2006.
The most recent certification assessment report indicated the following:
The design, content and integration of the Medicare Australia Service Charter are very impressive.
The Charter is now ranked as one of the best in Australia and the determination of the Medicare
Australia leadership team to pursue its vision and achieve a revolutionary result are to be
commended. The Service Charter rollout was an example to how all organisations should introduce
new Charters.
External awards and recognition
Medicare Australia won three state awards and a national award in the Call Centre Government
category from the 2005–06 Customer Service Institute of Australia (CSIA) awards. Three award
nominations were submitted to the CSIA’s 2006–07 Australian Service Excellence Awards in the
open categories of Service Charter, Large Business (Medicare office network) and Call Centre
(Queensland). The awards are highly contested by both public and private organisations.
Medicare Australia was a finalist in all three categories and won two of the major awards in the
Service Charter and Large Business categories.
Feedback
Medicare Australia values all feedback. We have established a dedicated team to improve the way
feedback from the Australian public is recorded and reported. This has led to an increase in the
number of compliments and complaints recorded in 2006–07.
The service managers in each state analyse complaints and ensure that problems are resolved and
opportunities for business improvements are identified and implemented.
Table 5 – Feedback register
Feedback type
Volume
2005-06
2006-07
Suggestions
109
125
Compliments
417
721
Complaints*
786
1325
* A complaint is entered onto the feedback register only if it is not satisfactorily resolved by either the
staff member initially contacted or the staff member’s supervisor.
In one of the four promises in our service charter (‘be genuinely interested in me’), we promised to
respond to feedback in a timely and efficient manner. We committed to reduce the time we take to
acknowledge feedback from 14 days to two days and to reduce the time we take to respond to
complaints from 28 days to within 14 days. We have now implemented processes to fulfil these
promises.
Ombudsman
We have centralised our handling of complaints to the Commonwealth Ombudsman to ensure that we
respond to the needs of the Australian public. Between 1 July 2006 and 30 June 2007, the
Commonwealth Ombudsman received 123 complaints concerning Medicare Australia, a 21.7 per cent
decrease (34) from the previous year. During the year, the Commonwealth Ombudsman closed 116
cases concerning Medicare Australia, covering 124 issues. Of the cases closed, 31 (26.7 per cent)
covering 34 issues were investigated. No findings of administrative deficiency were recorded.
Local Liaison Officer Program
The Local Liaison Officer (LLO) Program continued to operate throughout 2006–07.Local Liaison
Officers are a channel where Members of Parliament and Senators can receive advice in response to
constituent concerns about any DHS agency, including Medicare Australia. The program aims to
make all DHS agencies more responsive to information requests and complaints that come directly
through Ministers, other Members of Parliament, Senators and their staff.
We currently have 16 LLOs supporting 16 of the 150 Members of Parliament and 17 LLOs supporting
22 of the 76 Senators. The remaining Members and Senators are supported by LLOs from other DHS
agencies.
To ensure that all Medicare Australia LLO referrals are acknowledged within 48 hours, a network of
back-up LLO staff and contact officers has been established.
In 2006–07, 4 580 referrals were received throughout DHS, of which Medicare Australia LLOs
received 424. Of these, 92 were enquiries that related directly to Medicare Australia.
People with disabilities
During 2006–07, Medicare Australia continued to respond to the Commonwealth Disability Strategy
with a range of activities guided by the principles of equity, inclusion, participation, access and
accountability. Information kits about our programs are available in Braille, large-print and audio
formats from Medicare offices and Medicare Australia contact centres. Large-print information is also
available from the Medicare Australia website.
We provide access to the Telephone Typewriter Service and the National Relay Service for people
with hearing or speech impairments.
The provisions of adequate physical access to Medicare offices is mandatory elements in all lease
negotiations. Elements that are continuously upgraded include the installation of automatic doors, sitdown service counters and writing slopes. Adequate seating, along with the electronic queue ticket
systems in our busiest offices, makes our offices more comfortable for the public.
Counter hearing systems will be installed in a number of Medicare offices to provide better access to
services for people with hearing disabilities.
Indigenous Australians
The Australian Bureau of Statistics preliminary estimates indicate that, as at 30 June 2006,
Indigenous people make up 2.5 per cent of Australia’s population, which equates to around 517 000
people. Most Indigenous people live in New South Wales and Queensland, followed by Western
Australia and the Northern Territory.
Indigenous Access Program
Medicare Australia’s Indigenous Access Program was established in 2000 to improve Aboriginal and
Torres Strait Islander people access to our programs. The program supports health service providers
and Indigenous people to make full use of Medicare Australia programs and ultimately to improve
their health outcomes.
The Indigenous Access Program is led by a national office team responsible for setting the strategic
direction for initiatives and policies relating to Indigenous service delivery. This includes the
management and coordination of the key activities of the national network of Medicare Indigenous
Access liaison officers. Liaison officers operate in each state and territory and have a range of
culturally appropriate skills and expertise. They work closely with Aboriginal and Torres Strait Islander
medical services and other health service providers to promote and support the use of Medicare
Australia programs.
The network improves enrolment and access to Medicare Australia services, providing systematic,
dedicated support and outreach services to Indigenous people and communities.
The responsibilities of the Indigenous Access liaison officers are to:
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provide Medicare education and training to Aboriginal and Torres Strait Islander Health Service
(ATSIHS) staff to increase enrolments in Medicare and to ensure that correct Medicare benefits
are claimed, resulting in increased Medicare revenue for the service
provide support and expert advice to health service staff and providers when new Medicare
initiatives are released
make field trips and visits to health services, local communities, prisons and schools
Represent and promote Medicare Australia programs and services at local Indigenous forums and
events.
Medicare Australia also has a dedicated telephone service to assist health service providers and
Indigenous Australians with enquiries.
The Aboriginal and Torres Strait Islander Access line (1800 556 955), supported by liaison officers in
state headquarters, receives around4 000 calls per month.
Stakeholder engagement
Medicare Australia is represented on the Cross Agency Indigenous Servicing Task force, which
strengthens collaboration between DHS agencies to improve service delivery to Indigenous
Australians. Since its inception, the taskforce has overseen the implementation of a rangeof DHS
partnering initiatives, which have extended access to Medicare services.
These initiatives include the following.
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Throughout northern Australia, basic Medicare services are provided through the Centrelink
Remote Area Service Centre network and some small service centres and agent sites. Services
offered from these sites include Medicare enrolments, updating contact details, manual collection
of Medicare claims, ordering new or replacement Medicare cards and general enquiries.
People in northern Australia can now access Medicare Australia information and support through
the Centrelink Indigenous Call Centre network. Under this initiative, Centrelink staff transfer calls
directly to Medicare Australia’s Aboriginal and Torres Strait Islander access line.
Department of Human Services’ agencies schedule joint field trips where appropriate. The field
trips increase the breadth of community access and foster networking between agencies and
communities.
Medicare Australia also works with industry groups, such as the National Aboriginal Community
Controlled Health Organisation, to develop culturally appropriate education materials and policies for
ATSIHS staff.
Business practice agreements have been established to define the arrangements and obligations
agreed between Medicare Australia and DoHA’s Office of Aboriginal and Torres Strait Islander
Health(OATSIH), including funding for additional Indigenous Access liaison officers and otherstrategic
initiatives.
Medicare Australia also continues to work withhealth authorities, medical practitioners and
communities to improve the accuracy of immunisation data for Indigenous children.
Key activities in 2006–2007
In November 2006, Medicare Australia’s Corporate Management Committee endorsed the National
Indigenous Strategy. The strategy was developed as a blueprint for three years (2006–2009) of action
to improve Indigenous access to our programs and services. It aims to create a collaborative and
nationally consistent platform to enhance our service delivery to Indigenous Australians.
The strategy incorporates the findings and recommendations of a 2006 Urbis Keys Young market
research study, jointly commissioned by Medicare Australia and DoHA. We have formed the
Indigenous Strategy Steering Committee to oversee the implementation of the strategy.
The National Indigenous Access Program Conference, held in Canberra in November 2006, was
attended by all Medicare Australia Indigenous Access liaison officers, their managers and the
stakeholders of the Indigenous Access Program. The conference discussed factors affecting
Indigenous service delivery and set the planning framework for improving the capacity of the
Indigenous Access Program.
The development and rollout of the Voluntary Indigenous Identifier Communication and Education
Strategy aims to encourage all Indigenous Australians to self identify.
The Indigenous identifier allows Medicare Australia to capture vital information about Indigenous
enrolments and is part of a broader government initiative to identify areas of high Indigenous
populations so areas of greater need can be targeted. The identifier gives us information for future
program planning, policy development and service improvements.
Between July and October 2006, Medicare Australia participated in eight Croc Fest events across
Australia.
The Department of Human Services sponsored the ‘I Want to Be’ and ‘Climbing Wall’ activities and
Medicare Indigenous Access liaison officers assisted with these events and provided promotional
materials for those attending (including an estimated 17 500 children).
The Indigenous Access Program supported OATSIH with a national rollout of Medicare education
workshops. The workshops were targeted at the OATSIH funded Indigenous health services and
relevant health professionals and provided a great opportunity to meet some of the key stakeholders
and to strengthen our alliance with OATSIH.
We strengthened our commitment to Indigenous communities in northern Australia by establishing
regional offices in Broome, Cairns and Darwin, significantly improving access to services and support
and we continued to operate the Aboriginal and Torres Strait Islander access phone number.
Reconciliation Action Plan
Medicare Australia has developed its first Reconciliation Action Plan. Underpinned by the National
Indigenous Access Strategy and the Indigenous Employment Plan, it commits us to initiatives under
the four key result areas of the National Indigenous Access Strategy.
1. Improving Indigenous access to our programs.
2. Increasing Indigenous Australians’ awareness of our services.
3. Delivering great service to all Australians.
4. Becoming an employer of choice for Indigenous Australians.
Collection of health service information
Medicare Australia collects information on medical practitioners providing services at Indigenous
health services registered under section 19(2)of the Health Insurance Act. Under the Act, the Minister
for Health and Ageing has directed that Medicare benefits be paid to these health services. Benefits
are not payable where a health service is funded from another source, unless the Minister directs
otherwise.
The information we collect enables the identification of Medicare payments provided to these health
services and subsequently used to improve Indigenous health.
Cultural diversity
Australia is one of the most culturally diverse nations. Around 25 per cent of Australians were born
overseas and more than 40 per cent have one or both parents who were born overseas. Australia’s
people are drawn from about 185 countries and speak more than 200 languages at home. Medicare
Australia continuously develops strategies to communicate effectively with this diverse audience.
We receive eligibility information about migrants and applicants for permanent residence from the
Department of Immigration and Citizenship. This electronic data transfer helps to streamline
enrolment processing for new arrivals.
In line with the Charter of Public Service in a Culturally Diverse Society, endorsed by the Council of
Australian Governments, we offer a number of services and activities to assist people from culturally
and linguistically diverse backgrounds. Information kits about the programs administered by Medicare
Australia are available in 18 languages from Medicare offices, call centres and our website.This
information is also available in English on audio cassettes for people.
People can access more than 100 languages through the telephone interpreter service and speak to
a qualified interpreter by phone or at a face-to-face interview.
In 2006–07, more than 2600 accessed Medicare Australia information through the telephone
interpreter service. Many Medicare Australia employees are bilingual and use their language skills to
make communication with the Australian public easier and more effective.
Staff matters
Like most organisations in Australia, Medicare Australia faces increasing challenges in attracting and
retaining staff in a tight labour market affected by high employment levels and an ageing workforce.
A major focus in 2006–07 was on developing innovative and flexible practices to attract, develop,
remunerate and reward staff, to ensure they want to stay with us.
Attraction and development: a capability framework
Medicare Australia must identify the capabilities required of our future workforce, support current staff
to develop those capabilities and use targeted recruitment. To meet this challenge, we developed and
introduced our Capability Framework in 2006–07. The framework is the first step in realigning the
capabilities of our people and identifies the broad, nationally consistent, capabilities we need to
maintain our reputation for excellence in service delivery.
The framework will be integrated progressively into all our human resources functions. It will inform
the core selection criteria for all vacancies and underpin performance and development agreements
as well workforce planning at organisational and job-specific levels.
The Capability Framework defines six ‘capability clusters’.
1. Exemplifies great service.
2. Shapes strategic thinking.
3. Achieves results.
4. Cultivates productive working relationships.
5. Exemplifies personal drive and integrity.
6. Communicates with influence.
‘Exemplifies great service’ is from the Medicare Australia service charter and the behaviours that
demonstrate our promises to the Australian public and service providers. The other fi ve are based on
those developed by the Australian Public Service Commission and reflect the capabilities required of
all Australian Public Service (APS) employees.
Recruitment
In 2006–07, Medicare Australia developed innovative recruitment practices to attract the widest
possible field for vacant positions. We used a wide range of media for advertising, including online
employment sites, community newspapers and university career and websites.
Application processes have been greatly simplified, particularly by reducing the requirement to
address individual selection criteria in favour of a broad statement of claims and selection is now
consistent across the organisation. As a result, we have been able to attract many new staff from
outside the APS, including the Canberra market, bringing in new skills and experience.
In 2006–07, Medicare Australia developed a nationally consistent employee induction program. The
program aims to ensure all new starters understand our business context and challenges and provide
a guide to working in the organisation.
Medicare Australia’s principles
To ensure a good fi t between potential employees and Medicare Australia, we continued work to
develop a set of principles specific to the organisation. The principles will translate the APS Values to
Medicare Australia’s operating environment and align with our service charter and strategic themes.
We created a draft set of principles after analysing responses to a question in our 2005–06 staff
survey: ‘What words best describe what you most value about working for Medicare Australia?’.
Extensive consultation followed with more than 200 staff in the national and state offices. We expect
to produce a final set of principles during 2007–08.
Certified agreement
Medicare Australia’s current certified agreement (2005–2008) has a nominal expiry date of 5
December 2008. The agreement applies to all Medicare Australia employees, other than Senior
Executive Service (SES) staff and those staff covered by an Australian Workplace Agreement (AWA).
The certified agreement establishes a clear link between salary increases and organisational
performance. This helps to ensure all staff can see how their commitment and performance
contributes to the success of the organisation. Of the four per cent annual salary increase available in
2006 and 2007, one per cent is conditional on staff supporting strategies to achieve organisational
outcomes. In December 2006, the Corporate Management Committee confirmed that staff had met
this criterion for 2006. Consequently, the one per cent increase was paid to all staff covered by the
certified agreement. A further one per cent was paid if the individual employee achieved a rating of
‘fully effective’ or higher in their annual performance assessment.
Australian Workplace Agreements
Medicare Australia has used AWAs as a means to attract and retain quality people in
a tight employment market. Non-SES AWAs offer access to performance pay, increased annual
salary rates and, for specialists such as medical officers, a professional development allowance.
We are broadening the use of AWAs as a retention and recognition strategy, offering them
progressively to frontline managers of branch offices, managers of information and processing
centres and some other staff at the APS 5 and APS 6 levels. With the exception of performance
based pay, non-SES staffs covered by an AWA receive conditions of employment (for example,
leave, overtime, shift work allowances) consistent with the agency’s collective agreement.
Senior executive remuneration
Senior executive remuneration is offered as a package through an AWA. Australian Workplace
Agreement remuneration levels are subject to approval by the CEO and are based on work value,
individual capability, individual contribution, performance and market considerations.
A notional salary range for each classification level is set with reference to market comparisons,
taking into account:
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the annual survey of APS SES remuneration commissioned by the Department of Employment
and Workplace Relations
general economic conditions
Medicare Australia’s need to sustain a high level of performance.
The CEO reviews senior executive remuneration at the end of the annual performance cycle, taking
into account the organisational performance of Medicare Australia, individual performance and
comparative remuneration data.
Managing performance
Medicare Australia places great emphasis on establishing clear performance agreements between
managers and staff. Under our certified agreement and AWAs, all staff are required to enter into
performance support agreements with their managers.
The Performance Support Program is linked to our business planning, so staff understand how their
work contributes to the objectives of the wider organisation and have a clear understanding of what is
expected of them over the year.
In the 2006–07 staff survey, 90.6 per cent of all staff agreed that ‘I know what is expected of me at
work’, demonstrating that performance support agreements are effective. Performance reviews are
undertaken mid-term in December. Annual assessment occurs in June–July.
We encourage managers and staff to undertake quarterly reviews in September and March.
Performance pay
All staff covered by AWAs is eligible for performance bonuses. Staff who receive a performance
rating of ‘fully effective’ or above are entitled to the bonus. Staffs are assessed each June at the
completion of the performance cycle. Where the bonus is applicable, it is paid in August.
Medicare Australia Excellence Awards
The Medicare Australia Excellence Awards began in July 2006, establishing a consistent means to
identify, recognise and reward outstanding performance across the organisation. Certificates and gift
vouchers are awarded to winning teams or individuals in each state office and the national office
every six months. Winners from these rounds are considered in December and January for the
National Excellence Award.
In January 2007, the CEO presented the first National Excellence Award to the Victorian
Environmental Focus for Ongoing Results Team (EFFORT). The award recognised the team’s major
contribution to Medicare Australia and the Australian public in developing new initiatives that
contributed to environmental improvement and significant cost savings for the agency. Policy and
practice for the awards was reviewed in early 2007, including independent comment from the
Customer Service Institute of Australia. As a result, improvements will apply from late 2007.
Staff survey
Medicare Australia conducts an annual survey of all staff to determine their level of engagement with
the organisation. Nearly 92 per cent of staff completed the questionnaire for the 2006–07 survey,
which was conducted on 2 May. Results were extremely encouraging, with 79 per cent of staff saying
they were satisfied with Medicare Australia (up from 71 per cent the previous year) and 89 per cent
saying they were committed to contributing to the success of the organisation (up from 84 per
cent).As in previous years, all business and risk management plans will integrate specific actions and
timeframes to address concerns raised in the survey. Business units will report back regularly on
progress made.
Human resource consultants
Each state and national office human resources team employs a number of consultants to advise and
guide managers and staff and clarify policy. This support covers a broad range of matters, including
remuneration strategies, counselling, performance management, recruitment, retention, conditions of
service, flexible working arrangements and managing absenteeism.
Learning and development
An integrated learning and development framework is fundamental to retaining staff and ensuring
they have the skills to meet emerging challenges. During 2006–07, the learning and development
focus in Medicare Australia was on the design, development, implementation and evaluation of
training to give staff relevant skills and to train new staff in current programs.
We placed particular emphasis on providing nationally consistent program content to all staff,
regardless of their location. To do this, we used blended learning techniques and a number of media
presentations for training, while complying with adult learning principles.
One major achievement was the development and implementation of CustomerFirst, a customer
service training program for all Medicare Service Officers. This program was developed in response
to the changing environment in which Service Officers operate and particularly their higher level of
interaction with the public arising from such new responsibilities as Family Assistance.
Implemented nationally with outstanding results, the program uses in-house facilitators with current
operational experience. Customer First will be offered to all new Service Officers as part of their
induction and will become part of the operational training curriculum.
e-Learning
Medicare Australia has continued to develop eLearning training programs to support its blended
learning philosophy. The programs, which have been developed in-house to meet corporate and
operational technical needs, cover:
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Online Services
records management
business process flows
environmental management awareness
organ donor program
electronic funds transfer
consumer directory maintenance system
Medicare and PBS.
Core skills
Performance support agreements identify individuals’ learning and development needs. We run a
range of training programs in-house and externally. Major programs delivered in 2006–07 included
contract management, project management, writing skills and business analysis.
Knowing theBusiness Program
The Knowing the Business Program is an important recent initiative in Medicare Australia. The
program enables our people to better understand the work of others in the organisation and to
appreciate how the work environment is changing. It has three elements.
1. Knowing the Business – Frontline takes national office staff into the Medicare office network
so they can understand and appreciate the work done by Service Officers. Eleven senior staff
undertook this element in 2006–07.
2. Knowing the Business – Corporate enables staff from state offices and Medicare offices to
visit and work in the national office, to understand the relationship between operational
requirements and national office strategic policy and planning. Nine staff from various locations
participated in this element in 2006–07.
3. Knowing the Business – Customer was developed to foster relationships between Medicare
Australia and external stakeholders by conducting visits to a particular area of our business.
Ten staff from DHS participated in this element in 2006–07.
Equity and diversity
Medicare Australia’s Equity and Diversity Plan 2004–07 entered its third year of operation amid
continued organisational change. To continue to assist staff to transition to the APS, a training
program was completed in late 2006 for all people managers, who then provided training for their
staff. The program was complemented by an eLearning module that provided an introduction to the
APS Values and Code of Conduct, with some scenario activities to help staff understand how the
values and code apply in the workplace.
Medicare Australia has committed to increasing Aboriginal and Torres Strait Islander staff to two per
cent of the agency’s workforce by the end of 2008 and has made significant steps towards this goal.
By the end of June 2007, 1.62 per cent of staff had identified themselves as Indigenous Australians.
Medicare Australia recently developed a new Indigenous Employment Plan, which is focused on
developing a nationally consistent approach and framework for the recruitment and retention of
Indigenous Australians. Key elements of the plan were included in our Reconciliation Action Plan,
which was formally presented to Reconciliation Australia at a ceremony on 30 May 2007.
The plan commits us to further reconciliation initiatives and will help us work towards important
strategic goals, such as improving Indigenous access to our programs and becoming an employer of
choice for Indigenous Australians.
The Indigenous Employment Plan includes participation in the National Indigenous Cadet Program.
Our Information Technology Services Division placed three Indigenous cadets during the year. The
cadets, who are undertaking tertiary studies, gain valuable work experience by working at Medicare
Australia for a total of 60 days each year during term and semester breaks.
This program will continue as it is benefiting both the organisation and the cadets.
In response to the Management Advisory Committee’s 2006 Report on Employment of People with
Disability in the APS, Medicare Australia is developing a Disability Action Plan with the assistance of
the Australian Employers’ Network on Disability. The network has undertaken a desktop review of our
recruitment process and will work with us to review our approach to reasonable accommodation and
adjustment.
Our Western Australian state office has worked successfully with CRS Australia to provide work
training for CRS Australia clients. In the past 18 months the office provided 34 work training
placements for CRS jobseekers; 14 obtained employment with us after the placement, most through
merit-based selection. CRS Australia nominated the state office for the 2006 Prime Minister’s
Employer of the Year Awards for this work.
A significant percentage of Medicare Australia staff originate from a non-English speaking
background which is consistent with our role of delivering services to the entire Australian community.
At 30 June 2007, 15.7 per cent of all staff were from a non-English speaking background.
Occupational health and safety
Securing the health and safety of all staff at work is a key priority for Medicare Australia, in
accordance with the requirements of the Occupational Health and Safety Act (OHS Act). In 2006–07,
we focused on developing national occupational health and safety (OHS) strategies.
Significant Achievements in 2006–2007
The Safety Management Unit in National Office was at the centre of work to develop preventive
strategies to reduce the number and severity of workplace injuries. All state headquarters and the
national office have a designated position responsible for day-to-day OHS, rehabilitation and
compensation operations.
These OHS representatives work closely with the Safety Management Unit to implement OHS
strategy in a coordinated way. An emerging task for the Safety Management Unit was to develop
health and safety management arrangements in line with changes to the OHS Act. A two day
workshop in Queensland on 30 April and 1 May began developing the arrangements, which we
expect to, implement in September 2007.
Medicare Australia’s National OHS Strategy and state OHS action plans focus on two areas. The fi rst
focus is on the agreed priorities identified in the Medicare Australia National Business and Risk
Management Plan. The two key OHS priorities included in the plan for 2006–07 were:
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providing a safe workplace by design
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providing an integrated framework for the management of return to work for staff with
compensable or non-compensable injuries or illness
The second focus is on meeting Comcare’s highly challenging health, safety and rehabilitation
targets. Initiatives in 2006–07 to address these areas of focus included:

a review of protracted workers’ compensation and non-compensation cases
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a rollout to all managers of OHS training, including ‘Prevention and Management of Body
Stressing Injuries for Managers’
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a national campaign to promote good office hygiene
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promotion of an online injury and hazard report form
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a new OHS intranet site
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promotion of World Day for Health and Safety at Work on 27 April 2007
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Development of the new workplace health and safety management arrangements required under
the Occupational Health and Safety Amendment Act 2006.
We used various means to ensure consistency in approach across Medicare Australia, including
monthly teleconferences of state and national office OHS representatives. The teleconferences
helped the consultants keep abreast of the latest OHS and workers compensation issues and
initiatives, such as:
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updates on prevention from the states
progress on national initiatives
rehabilitation issues and diffi cult workers compensation cases
Comcare advice notices and training activities.
Medicare Australia held a three-day conference for Medicare Australia’s OHS representatives in
November 2006. The conference focused on ‘providing a safe workplace by design’ and included
sessions on duty of care and the new penalty regime; accident investigation; OHS risks related to
relocation and refurbishments; bullying and harassment; an introduction to OHS contracting; and
rehabilitation provider expectations.
The Safety Management Unit provided quarterly reports to state managers on their performance in
compensation and injury management.
The reports detailed how each state’s performance contributed to meeting Comcare’s health, safety
and rehabilitation targets. Quarterly teleconferences were also held with each state manager, human
resource manager and OHS consultant to help the states reach the targets. Medicare Australia
reinforced reporting with targeted training. During March, April and May, Comcare conducted training
in preventing and managing body stress injuries for managers in all states. The training is one of our
initiatives to reduce such injuries. Medicare Australia also implemented a suite of generic plant risk
assessments for the 20 most frequently used items of plant throughout Medicare Australia during the
year. Medicare Australia participated in quarterly DHS national OHS networking meetings.
The meetings were hosted by different DHS agencies in rotation and allowed us to share experience
in the prevention and management of occupational injury.
Health and safety outcomes
Medicare Australia’s approach to managing workers compensation claims had a positive impact on
key performance indicators and the workers compensation premium rate. The excellent results
achieved in 2006–07 were due to our injury prevention strategies over the past three years. The
premium rate was also influenced by improvements in average compensation claim costs and by
legislative changes that reduced access to journey injury claims.
Medicare Australia achieved the following results in 2006–07, compared to 2005–06:
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five per cent decrease in injury frequency
19 per cent decrease inclaims frequency
11 per cent decrease in claims resulting in fi ve days or more off work
four per cent decrease in total weeks off work
24.7 per cent decrease in the 2007–08 workers’ compensation premium rate.
Despite an increase in overall staff numbers, the number of accepted claims has dropped over the
last three years from 160 in 2004–05 to 92 in 2006–07.
During the year, 26 incidents required notification to Comcare, of which one incident was
investigated. While no action was taken under the enforcement provisions of the OHS Act, an action
plan and timeframe for the implementation of Comcare’s recommendations were developed. No
directions were given under section 45 of the OHS Act; nor were any notices given under sections 46
or 47.
One provisional improvement notice was issued under section 29. The work area took the necessary
action to address the concerns raised in the notice and the notice was lifted.
Access to personal information
Medicare Australia ensures high standards of privacy protection. We have an extensive range of
privacy protection measures in place to ensure that we maintain community confidence by meeting
our legislative responsibilities and attain best privacy practice. We conduct Privacy Impact
Assessments (PIA) for new business initiatives and significant revisions to existing business and for
personal information audits. Business units receive comprehensive and timely privacy advice from the
Legal, Privacy and Information Services Branch. Staffs also receive twice-yearly messages from the
CEO about privacy standards.
The secrecy provisions of the Health Insurance Act and the National Health Act make it an offence for
a Medicare Australia officer to disclose information about a person to a third party, unless a specified
exception or release provision applies. For example, information may be released to state health
regulatory authorities, such as medical and pharmacy boards, on matters affecting the registration of
professional health providers. There is also provision under section 130(3) of the Health Insurance
Act and section 135A(3) of the National Health Act for the Minister for Health and Ageing, or an officer
to whom this authority is delegated, to certify that it is in the public interest for information to be
released.
Requests for the release of Medicare and PBS claims history information are processed in
accordance with the Health Insurance Act and the National Health Act, respectively. Requests for
other types of information or documents are processed under the Freedom of Information Act 1982.
Appendix B of this report contains statistics on Freedom of Information requests.
Medicare Australia is capable of auditing transactions within all its systems. Our staff are regularly
reminded of their obligations regarding the use of personal information; automatic warning notices on
computer screens are a further reminder whenever staff access electronic data.
Medicare Australia complies with the Privacy Commissioner’s guidelines on data matching and the
storage and destruction of personal information. We can provide de-identified statistical information,
in accordance with the relevant legislation, to help research projects that have the potential to
improve the health and wellbeing of Australians.Policies and standards set out in the Commonwealth
Protective Security Manual are observed and security controls are in place to ensure a high level of
protection for the data stored in Medicare Australia records.
Privacy training
The Privacy and Information Release Section of our Legal, Privacy and Information Services Branch
plays a fundamental role in raising awareness of privacy issues through training, participation in
various privacy forums and the provision of expert advice to internal and external stakeholders.
Medicare Australia meets its legislated training responsibilities by ensuring that all ongoing and non
ongoing employees, contractors and consultants complete the ‘National Privacy and Security
Training’ module. The module includes the Medicare Australia privacy awareness raising video,
Minding Your Business, which is a part of the Medicare Australia Privacy Training Kit. An eLearning
version of the training module was implemented in 2006–07.
Privacy Impact Assessments
Medicare Australia has developed PIA guidelines and a checklist to help managers determine
whether a PIA is necessary for their project. A PIA is an analysis of the personal information flows
and potential privacy risks of a project, conducted to mitigate privacy risks and impacts, ensure
compliance with legal obligations and build best privacy practice into projects.
In 2006–07, Medicare Australia established a working group to assist the Access Card Consumer and
Privacy Taskforce. The working group provided the taskforce with experience in conducting PIAs,
knowledge of Australian Government privacy policies and an understanding of the application of
current privacy policies in the key participating agencies. The taskforce’s PIA was presented to the
Minister for Human Services before revised access card legislation was introduced into Parliament in
June 2007.
The working group was headed by a deputy CEO of Medicare Australia and included a senior officer
from Centrelink, a legal officer from Medicare Australia and privacy officers from Medicare Australia
and Centrelink.
Medicare Australia also conducted PIAs for e-tax and online services projects in 2006–07.
In 2007–08, the Privacy and Information Release Section will continue to work closely with the
Unique Health Identifier and access card projects.
Consultancies
Medicare Australia engages consultants when we do not have sufficient specialist expertise available
or when we consider that independent assessment is desirable. Consultancies have provided advice
on:



management of organisational change
analysis of Medicare Australia’s audit and compliance programs
finalisation of the qualitative component of customersatisfaction research in 2006.management of
organisational change
During 2006–07, we entered into 37 new or extended consultancy contracts, involving total
expenditure of $3.2 million.
Consultants or consulting firms who were paid $10 000 or more during 2006–07 are listed in
Appendix D.
National procurement
The DHS procurement principles require portfolio agencies to combine their procurement activities
wherever practicable to maximise combined purchasing power. During 2006–07, Medicare Australia
participated in procurement processes conducted by other agencies for services including:

accommodation brokering

short term vehicle hire

supply of safes, security and storage containers and storage solutions

information technology vendor panels.
We were the lead agency for DHS in the procurement of:



records storage
stationery and office products
Express air freight services.
National property
In 2006–07, Medicare Australia entered into a new lease for accommodation for the Victorian state
headquarters at 595 Collins Street. Victorian staff moved into their new premises in the last week of
June. The fi t out of this office incorporates the latest design features for office accommodation,
including an open plan environment, flexibility in design to meet business needs and an appropriate
level of amenity.
We also negotiated a new lease for the Queensland state headquarters. Fit out of the new premises
has begun and we expect staff to move in during February 2008.
A major accommodation program was undertaken to consolidate the national office staff within the
Tuggeranong precinct in the Australian Capital Territory. To achieve this, we have leased additional
space in Tuggeranong and surrendered leased accommodation outside the immediate area.
The national Medicare branch office fi t out to incorporate Family Assistance office service delivery
into the branch office network was completed during 2006–07. Electronic queue ticketing systems are
being installed progressively to improve efficiency and customer service.
Records management
Information management and record keeping are important components of governance in Medicare
Australia. As an Australian Government agency, we are obliged to maintain good records of our
business activities for legal purposes.
Key activities undertaken during 2006–07 were:




publication of the Medicare Australia Records Management Framework 2007
continuation of education and training in record keeping compliance
a move towards national outsourced storage of archived records
a move towards national consistency in the sentencing and disposal of corporate records.
Environmental sustainability
Environmental management
Medicare Australia is committed to best practice environmental performance through an
environmental management system that aligns to the ISO 14001 international standard.
We have adopted a structured management approach to report our ongoing management of
environmental risks and environmental initiatives. After a review of Medicare Australia’s
environmental impacts; we developed a policy to systematically address the environmental aspects
of:



business decision making and procurement
energy, water and paper use
Waste management.
A key requirement of the environmental management system framework is environmental awareness
rising among staff and contractors. To raise awareness, we have established:







fully interactive eLearning modules on energy, paper, water and waste recycling, available to staff
on the corporate intranet
an intranet site dedicated to environmental information, initiatives, targets and general
performance
a nationwide network of environmental coordinators to achieve consistent and standardised
environmental practices
induction training on environmental awareness for new employees
whole-of-lifecycle assessment and environmental requirements in the procurement process, such
as the use of certified environmental labelling meeting ISO 14000 series standards
enhanced business planning processes to mitigate environmental risks
Environmental impact statements in costing templates for new business proposals.
After environmental audits and data gathering exercises to determine baseline measurements,
Medicare Australia has developed a series of initiatives for energy, water, paper and waste
management. The initiatives are performance managed (or governed) under our balanced scorecard
through environmental key performance indicators and targets.
Environmental Performance
The whole-of-government energy performance is reported to the Australian Greenhouse Office (AGO)
by 31 October each year and is externally reported in the Energy Use in the Australian Government
Operations Report. The Medicare Australia energy consumption for 2006–07 is currently being
determined for this reporting exercise.
Medicare Australia is currently achieving the 2011–12 energy targets set in the 2006 Energy
Efficiency Government Operations (EEGO) policy. This is as a result of utilisation of energy efficient
technologies as well as maximising occupancy density – based on a three dimensional fi t-out design
approach. In 2005–06, Medicare Australia achieved an energy use rating for tenant office light and
power of 6 944 mega joules per person against an EEGO policy target for 2011–12 of 7 500 mega
joules per person.
These efficiencies have been achieved in a business environment where Medicare Australia has
extended its branch office trading hours to late night shopping and Saturday morning trading.
Medicare Australia strives for continuous energy improvements in its property network with
independent energy audits scheduled for 2007. In addition, to offset greenhouse gas emissions,
Medicare Australia purchases 2.5 per cent green energy.
This is expected to increase to 8 per cent by January 2008. Medicare Australia has 156 fleet motor
vehicles comprising of both pool vehicles and executive vehicles. Of these, 30 per cent have a green
vehicle guide rating of 10.5 or above. This figure is expected to increase to 39 per cent by December
2007 and 57 per cent by December 2008. Greenhouse gas emissions produced from all fleet vehicles
have been offset through an offset subscription scheme. Medicare Australia also performance reports
on motor vehicle fuel consumption as well as E10 usage in its balanced scorecard.
Medicare Australia is a member of the AGO Greenhouse Challenge Plus (GHCP) Program, to
demonstrate a commitment to reduce greenhouse gas emissions. As part of the AGO program,
Medicare Australia will undertake independent verification to quality assure energy data as well as
take an active role in seeking new energy efficient technologies and/or offsets. In recognition of
greenhouse performance, Medicare Australia was a finalist in the 2007 GHCP Awards in the
Government and Essential Services category.
Paper
Medicare Australia consumes 33 million sheets or 174 tonnes of internal copy paper per annum. This
equates to 6 234 sheets per person per annum. In order to improve environmental performance,
Medicare Australia has introduced 50 per cent recycled copy paper for internal printers, faxes and
photocopiers. On a consumption level, internal copy paper has steadily grown over the past few years
due to an increase in business activity as well as the rapid movement to high speed printer
technology and competitive pricing structures of high speed printers.
To mitigate this issue, Medicare Australia has undertaken an extensive staff education program to
reduce consumption through re-promoting double sided printing and introducing a tighter printer
policy. It is expected that internal copy paper will reduce by 15 per cent by January 2008 with the
introduction of these initiatives.
On an external level, Medicare Australia has achieved significant environmental benefits with the
introduction of e-claiming and the associated declines in paper based claiming channels – also
through projects, such as the forms and envelopes consolidation strategy. The combinations of these
initiatives are expected to deliver a savings equivalent to five million A4 sheets of paper or 25 tonnes
of virgin fibre paper in 2007. Over the coming years, Medicare Australia will be seeking to introduce
recycled paper for external business arrangements providing the paper is fi t for purpose and cost
effective.
Water
As the drought continues in most parts of Australia, local governments have applied harsher water
restrictions to minimise water consumption.
As such, Medicare Australia staff and property owners have assisted in this process of complying with
water restrictions as well as developing initiatives to further address water consumption. The
introduction of low flow taps and showers as well as high pressure flush systems have been
introduced into the larger Medicare Australia property sites. New technologies and innovative designs
to conserve water will be introduced into existing and new building designs.
During 2006 the total estimated water usage for Medicare Australia was 54 million litres. On a per
person consumption level, the average water consumption during the year was 10 031 litres per
person per annum. Of this amount, air conditioning represents 4 831 litres per person per annum and
the remaining 5 200 litres per person per annum is for drinking, showers, toilets, cleaning, hand
basin, kitchen and garden use.
Medicare Australia expects personal consumption (net of air conditioning) to decline by 10 per cent
over 2007 through the above initiatives.
Waste
It is Medicare Australia’s aim to maximise recycling streams and to minimise waste to landfill. Key to
this objective is providing easy accessibility to recycling bins and improved signage. In addition, the
promotion of adverse environmental impacts of landfill, as well as benefits of recycling (waste to
resources), is promoted to staff. Medicare Australia will continue to develop new recycling streams in
order to divert landfill waste.
Medicare Australia sends 33 kg of waste per person per annum to landfill. With the introduction of
recycling standardisation practices across the property network, improved recycling infrastructure and
signage as well as the development of new recycling streams, Medicare
Australia expects to reduce personal landfill waste by 25 per cent over 2007.In addition, Medicare
Australia has successfully introduced Medicare Australia Re-use Stations (or MARS) into
communication centres, as a mechanism to reuse usable office supplies and equipment. Staffs
seeking office supplies or equipment are encouraged to investigate MARS before placing new orders.
Section 04 Programs
Medicare
Medicare was introduced in 1984 to provide eligible Australian residents with affordable, accessible
and high-quality health care. Medicare ensures that all Australians have access to free or low-cost
medical, optometrical and hospital care while being free to choose private health services and, in
special circumstances, allied health services.
Medicare Australia administers Medicare enrolments and medical benefit payments through its
network of Medicare offices and other information and claiming services.
We processed 257.9 million services in 2006–07, involving almost $12 billion in Medicare benefits.
The figures in the following tables are adjusted on an accrual accounting basis.
Table 6 – Medicare enrolments, claims and benefits – key business results
2005-06
2006-07
% Change
Persons enrolled* at 30 June 20.7 million
2007
21.1 million
+1.9%
Active cards at 30 June
2007
11.6 million
11.8 million
+1.7%
177.2 million
187.9 million
+6.0%
Enrolments
Services
Medicare bulk billed services
2005-06
2006-07
% Change
Patient claimed services
70.2 million
70.0 million
–0.3%
Total services processed
247.4 million
257.9 million
+4.2%
Average benefit per service
$44.37
$45.74
+3.1%
Average period service to
lodgement**
13.5 days
13.1 days
–3.0%
Average period lodgement to 3.9 days
processing***
3.3 days
–15.4%
Total benefits paid
$11.8 billion
+8.3%
Benefits
$10.9 billion
* Persons enrolled include some people who are not Australian residents, such as visitors from
countries that have reciprocal health care agreements with Australia and people covered under
ministerial orders.
** Time between date of a medical service and lodgement of a Medicare claim.
*** Time between date of lodgement and processing of a Medicare claim.
Medicare claiming
The 257.9 million services were processed for payment by cheque, cash and electronic funds transfer
(EFT) for paid accounts. Unpaid accounts were paid by cheques issued to the provider via the
claimant.
Table 7 – Medicare services by bill type
2005-06
%
2006-07
%
4.5 million
1.8%
4.5 million
1.7%
14.6 million
5.9%
12.9 million
5.0%
34.5 million
14.0%
34.4 million
13.3%
177.2 million
71.6%
187.9 million
72.9%
13.1 million
5.3%
14.1 million
5.5%
Services via EFT
3.5 million
1.4%
4.1 million
1.6%
Total services
247.4 million
100%
257.9 million
100%
Services paid by cheque to
claimant
Services paid by cheque to
practitioner via claimant
Services paid by cash
(Medicare offices)
Bulk bill services – benefits
assigned to practitioner by
claimant
Services paid via simplified
billing – in-hospital claims
lodged electronically
One service was processed via reverse EFTPOS transaction through Medicare Easyclaim
Figure 4 – Medicare services by bill type
Medicare Safety Net
The Medicare Safety Net is designed to help protect Australians and their families from high medical
costs for out-of-hospital medical services. There are three safety net thresholds.

The concessional and Family Tax Benefit (part A) thresholdapplies to concession cardholders and
families eligible for Family Tax Benefit (part A). Medicare will pay 80 per cent of the out-of-pocket
cost for medical services provided out-of-hospital, after a threshold of $519.50 per registered
family or individual per calendar year is reached. An out-of-pocket cost is the difference between
the provider’s charge and the Medicare benefit paid for that service.

The general threshold applies to all Medicare cardholders. Medicare will pay 80 per cent of the
out-of-pocket cost for medical services provided out-of-hospital, after a threshold of $1 039 per
registered family or individual per calendar year is reached.

The gap threshold applies to all Medicare cardholders and is based on the difference between the
Medicare Benefits Schedule (MBS) fee and the Medicare benefit paid for out-of-hospital services.
Medicare will pay the full 100 per cent of the MBS fee after the gap threshold of $358.90 per
registered family or individual per calendar year is reached.
Medicare eligibility
People who reside in Australia are eligible for Medicare benefits if they hold Australian or New
Zealand citizenship, have been issued with a permanent visa or have applied for a permanent visa.
Restrictions and other requirements apply to people who have applied for a parent visa.
Australian citizens who have resided overseas for more than five years and permanent resident visa
holders, who have resided overseas for more than 12 months, are required to demonstrate their
intention to reside permanently in Australia before a Medicare card can be issued to them.
Medicare cards
Medicare cards are issued to eligible people to make it easy for them to access Medicare benefits.
Four different Medicare cards indicate the holder’s level of Medicare eligibility to medical
professionals and their staff.

Green Medicare cards are issued to Australian citizens and permanent residents and indicate that
the holder has access to all eligible Medicare services.

Blue Interim Medicare cards are issued to consumers who are granted eligibility for Medicare
while their application for Australian permanent residency is under consideration and indicate that
the holder has time-limited access to all eligible Medicare services.

Yellow Medicare Reciprocal Health Care Cards are issued to visitors to Australia who are
residents of countries with which Australia has reciprocal health care agreements. The holder’s
access to Medicare services is time limited and does not cover treatment as a private patient in a
public or private hospital.

Green Medicare smartcards were issued, as part of a trial conducted in 2005, to Australian
citizens and permanent residents who lived in Tasmania. Like the green Medicare card, the
smartcard indicates that the holder has access to all eligible Medicare services.
Medicare levy exemptions
The purpose of the Medicare Levy Exemption program is to assess applications for a certificate which
confirms that the applicant is eligible for exemption from paying the Medicare levy.
Exemption certificates are issued to people who, while living or working in Australia, are not entitled to
Medicare coverage but are liable to pay the Medicare levy through their taxes.
When an application is approved, a certificate is issued to the applicant for the financial year. The
certificate is then included with the applicant’s tax return at the end of the financial year.
The increase in rejected applications for 2006–07 was as a result of the tightening of regulations and
documentation requirements.
Table 8 – Medicare cards and Medicare levy exemptions Medicare
Medicare
2005-06
2006-07
% Change
3 354 997
3 824 858
+14.0%
Cards
Total cards issued*
Medicare levy exemption
Total applications
26 342
27 216
+3.3%
Accepted applications
25 580
24 567
–4.0%
Rejected applications
762
2 649
+247.6%
* Includes health care cards issued under reciprocal health care agreements.
Eligible visitors to Australia
The Australian Government has signed reciprocal health care agreements with some countries,
entitling residents of those countries to restricted access to health cover while visiting Australia.
Currently, these countries are Finland, the Republic of Ireland, Italy, Malta, New Zealand, Sweden,
Norway, the Netherlands and the United Kingdom.
Improved services for migrants and conditional migrants
During 2006–07, Medicare Australia and the Department of Immigration and Citizenship continued to
work together, through the electronic transmission of information, to:

improve service delivery for people who have applied for, or been granted, permanent residency
status in Australia

reduce administrative burdens associated with establishing Medicare eligibility

Simplify Medicare enrolment.
Staff at Medicare Australia also worked closely with migrant resource centres and volunteer groups
dealing with migrants to provide information about Medicare requirements.
Mental health
The Better Access to Psychiatrists, Psychologists and General Practitioners through the Medicare
Benefits Scheme initiative was developed as a core element of the Australian Government’s $1.9
billion contribution to the Council of Australian Governments’ mental health package to reform
Australia’s mental health system. The aim of the initiative is to increase community access to better
and more affordable team-based mental health care.
New MBS items wereintroduced on 1 November 2006 and 1 May 2007, including for services
provided by psychiatrists, general practitioners (GPs) and allied mental health providers, such as:

registered clinical psychologists

registered psychologists

registered occupational therapists

Registered social workers.
General practitioners are best placed to coordinate the treatment needs of patients with mental
disorders in the primary care setting and the new GP Mental Health Care Plan and Consultation MBS
items support them to do this. The items provide a structured framework for general practitioners to
undertake early intervention, assessment and management of patients with mental disorders and
provide new referral pathways to clinical psychologists and other allied mental health service
providers.
In addition, 20 new MBS items were introduced for allied mental health services provided to patients
on referral from a general practitioner who is managing the patient either:

under a GP Mental Health Care Plan and/or

a psychiatrist assessmentand management plan, or

From a psychiatrist or a paediatrician.
Eligible allied mental health services include psychological assessment and therapy services
provided by eligible clinical psychologists and focused psychological strategies provided by eligible
psychologists, social workers and occupational therapists. Allied mental health professional bodies
have provided information on their websites about members who are eligible to provide these
services.
Enhanced Primary Care Plans – Allied Health and Dental Care initiative
The Medicare Allied Health and Dental Care initiative commenced on 1 July 2004. It provides for
Medicare benefits to be paid for certain services provided by eligible allied health professionals,
dentists and dental specialists to people with chronic conditions and complex care needs who are
being managed by a medical practitioner (not including a specialist or consultant physician) under an
Enhanced Primary Care plan.
The initiative is open to Aboriginal health workers, audiologists, chiropodists, chiropractors, dental
practitioners/specialists, diabetes educators, dieticians, exercise physiologists, mental health workers,
occupational therapists, osteopaths, physiotherapists, podiatrists, psychologists and speech
pathologists.
The Medicare rebate for allied health professionals providing services under an Enhanced Primary
Care plan is currently $46.80 per service. In the first three years of the initiative, over 1.7 million allied
health services have been provided, representing around $79 million in Medicare benefits.
The take-up of allied health services has grown from over 248 000 services in the first year (2004–05)
to nearly 931 000 in 2006–07. Almost a quarter of all services are provided in rural areas.
Medicare Australia special assistance
Through Medicare Australia, the Australian Government provides assistance to meet individuals’
health and community care costs arising from certain adverse events, such as natural disasters and
terrorist attacks. The government decides which events are to be covered. Usually, the people
assisted in this way are people at the scene of the event or its aftermath, or their close relatives.
The assistance is in the form of ex-gratia payments to clients or health care providers for activities
performed under guidelines agreed to or approved by an Australian Government Minister, by a
taskforce or by various agencies. The activity is usually part of a whole-of-government initiative
involving several government agencies and sometimes non-government organisations.
Medicare currently administers the following special assistance:

Balimed

Tsunami Healthcare Assistance

London Assist

Bali 2005

Dahab Egypt Bombing Health Care Costs Assistance.
Veterans’ Affairs processing
Medicare Australia processes medical, hospital and allied health services claims for services provided
to veterans on behalf of DVA. A service level agreement between Medicare Australia and DVA
outlines the services, service standards and financial arrangements. In December 2006, we
celebrated our 10th year of processing claims on behalf of DVA.
On 1 November 2006, we implemented significant system enhancements to support new Veterans’
Affairs policy and budget initiatives.
From 1 January 2007, a revised governance model took effect to ensure effective communication at
all levels between the two organisations. The model includes senior level meetings and more regular
project and operational meetings.
Representatives from both agencies continued a business rules taskforce to review health business
rules and develop strategies for continuous processing and customer service improvement. The
taskforce consulted key business areas to determine priorities. The focus was on DVA related
medical claims to meet new online requirements and business rules associated with allied health
providers. The taskforce identified problems and developed strategies to resolve them.
In 2006–07, we processed 21.8 million services for DVA, totalling nearly $2 billion. Medicare Australia
also took on both the Gold and White card bulk re-issues during 2006–07 and introduced the new
totally and Permanently Incapacitated Gold in February 2007.
Table 9 – Veterans’ Affairs activities – key business results
2005-06
2006-07
% Change
PTEC*, STEC**,
RPBC*** and TPIG****
cards produced
75 503
173 090
+129.2%
Services processed
21.5 million
21.8 million
+1.4%
Total benefits paid
$1.8 billion
$1.9 billion
+5.6%
* Personal Treatment Entitlement Card
** Specific Treatment Entitlement Card
*** Repatriation Pharmaceutical Benefits Card
**** Totally Permanently Incapacitated Gold card representing $6.5 billion in benefits.
Broadband for Health
The Australian Government’s Broadband for Health initiative supports the use of broadband internet
services by general practices, Aboriginal community-controlled health services and community
pharmacies.
The Government provides an incentive for the take-up of Broadband for Health qualified services by
eligible locations. The incentive assists with the installation costs and with the 12-month subscription
cost of at least one broadband qualified service.
Visiting Medical Practitioners Program
Through an agreement with the Department of Health, Western Australia, Medicare Australia
administers a visiting medical practitioner fee-for-service payment and information system. The
system provides public non-teaching hospitals in Western Australia with a real time intranet
processing system, which connects to the Medicare system, to access and pay invoices submitted by
visiting medical practitioners for services to public patients.
This agreement, which has been in place since April 2000, was replaced with an updated service
agreement in January 2007.
Medicare Australia has assessed invoices valued at approximately $57 million for around 330 000
lines processed.
Medicare office network
Medicare Australia has a network of 238 Medicare offices throughout Australia, supported by our
national computing and communications infrastructure. Over 93 percent of people living in the greater
metropolitan areas of Australia have access to one of 119 Medicare offices within a 12 km drive from
their home. All the offices give the Australian public convenient access to the following services:

processing of enrolments and registrations

cash, cheque and EFT payments

lodgement of participating health fund claims under two-way arrangements

processing of claims for the Australian Government 30% Private Health Insurance Rebate

benefits for the PBS

Family Assistance services

LPG Vehicle Scheme services.
Across Australia, 54 Medicare offices are open for extended evening hours on Thursday or Friday
evenings and 193 open longer from Monday to Friday. Along with the 117 Medicare offices that are
open on Saturday mornings, these additional hours enable us to provide a higher level of service,
more convenience and greater choice for the public. The locations of Medicare offices within each
state and territory are published on our website.
We continually review Medicare office design to ensure that it meets the needs of our customers.
Physical access features include automatic doors, sit-down customer service counters and sit-down
customer writing slopes.
The current Medicare office design incorporates a combination of modular and standard seating
arrangements to suit different people’s requirements. Along with the electronic queue ticket systems
introduced in our busiest offices, this provides comfort and convenience for the waiting public. We are
implementing a new self-service facility, in the form of sit down self service zones, to give the public
easy access to our internet and telephony channels.
In a number of offices, counter hearing systems are to be installed to provide better access to
services for people with hearing disabilities.
Medicare Australia Access Points
Across Australia there is a network of over 1 000 Medicare Australia Access Points providing easy
access to Medicare claiming and information. These outlets are self-service telephone booths in rural
transaction centres, state government agencies, pharmacies, post offices and shops. Their locations
are published on our website.
Most of the services available at a Medicare office are also available at an Access Point, with the
exception of cash services and face-to-face interaction. As well as claiming a Medicare benefit, a
person can request a copy of their Medicare benefit tax statement, update their Medicare details,
register as an organ donor and access information about the PBS and the Australian Childhood
Immunisation Register. If a claimant lodges paid accounts at these facilities and selects the EFT
option, the rebate is paid into their bank account promptly.
Flexible service delivery
Since October 2006, Medicare Australia and Centrelink, working with DHS, have trialled new and
more flexible service delivery arrangements to extend the reach of government services and public
access to services, while maximising the use of the office network capacity of the two agencies.
Medicare Australia provided Centrelink Seniors and Carers access services in four Medicare offices:
Box Hill, Victoria; Hillarys, Western Australia; Port Macquarie, New South Wales; and Marion, South
Australia. The servicesincluded general enquiries about the Age Pension and Carers Allowance,
lodgement of new claims for the Age Pension and changes of personal details, such as personal
information, income, assets and marital status.
Centrelink offered non-cash Medicare services in four Centrelink offices: Sutherland, New South
Wales; Earlville, Queensland; Broome, Western Australia; and Launceston, Tasmania. The services
included all those offered by Medicare offices, with the exception of cash refunds.
During the trial period, Centrelink provided 6 405 Medicare Australia services, while Medicare
Australia provided Centrelink services to 4 624 customers.
Customers valued the convenience of having more than one place to do business in their local area.
Of surveyed customers, 69 per cent said the experience was better than their previous interactions
with the agency and 86 per cent rated their satisfaction as very high.
Electronic queue management systems in Medicare offices
To improve the public’s experience, we have installed electronic queue management software in 165
Medicare offices across Australia. This includes 65 offices with a full electronic ticketing system and
sit-down waiting facilities. The remainder have a partial queue management system, enabling service
officers to record details about the transaction. The systems improve customer flows and our
monitoring of service delivery.
We signed a contract with Nexa Group Pty Ltd in May 2007 to expand the delivery of an enterprisebased queue management solution to all 238 Medicare offices across Australia. This will provide realtime queue management information that will be used to improve workforce planning.
Additional government services delivered through Medicare offices
Since the commencement of Family Assistance in July 2000, Australian families have been able to
access limited Family Assistance services at Medicare offices. A phased implementation of full
services in all Medicare offices began on 1 July 2005 and was completed on 6 November 2006, eight
weeks ahead of schedule, by which time full services were available in all 238 offices. Since July
2005, we have provided Family Assistance services to more than 665 000 customers – a daily
average of 7.8 customers per Medicare office – with nearly 540 000 in 2006–07.
Medicare offices have also been providing information and receiving applications for rebates under
the LPG Vehicle Scheme. Australians have shown a preference for accessing this service through
Medicare offices, with 66 per cent of all applications for the rebate being lodged with us.
Pharmaceutical Benefits Scheme
The PBS gives all Australian residents and eligible overseas visitors access to prescription medicines
in a way that is affordable, reliable and timely. Through the PBS, the Australian Government
subsidises the cost of listed prescription medicines, making them more affordable for all Australians.
The Department of Health and Ageing (DoHA) is responsible for program policy development and the
overall management of the PBS, including the Schedule of Pharmaceutical Benefits and DVA is
responsible for the overall policy for the Repatriation Pharmaceutical Benefits Scheme (RPBS).
Medicare Australia is responsible for administering the PBS, which involves processing pharmacists’
claims, approving authority prescriptions, approving pharmacists and certain doctors to supply PBS
medicines and approving private hospitals and participating public hospitals to supply PBS medicines
to their eligible patients.
We make payments under section 100 of the National Health Act to pharmaceutical companies for
the supply of in-vitro fertilisation hormones, fertility drugs and botulinum toxin and fund medications
under the Highly Specialised Drugs Program.
We make payments to colostomy and ileostomy associations for ostomy supplies. We also make
payments under a non-PBS program to fund the use of Herceptin for the treatment of patients with
metastatic breast cancer.
In 2006–07, we processed 183.1 million services under the PBS and RPBS, representing $6.5 billion
in benefits.
Table 10 – PBS expenditure – key business results
2005-06
2006-07
% Change
PBS benefits paid *
$5.8 billion
$6.0 billion
+3.4%
RPBS benefits paid
$469.7 million
$449.5 million
–4.3%
Total benefits paid
$6.3 billion
$6.5 billion
+3.2%
168.2 million
168.3 million
+0.1%
15.2 million
14.8 million
–2.6%
183.3 million
183.1 million
–0.1%
PBS services
processed*
RPBS services
processed
Total services
processed
* including stoma
PBS eligibility
There are two levels of eligibility for the PBS: general rate and concessional rate. At the general rate,
a person pays up to $30.70 for their prescription medicine; at the concessional rate, they pay up to
$4.90. These figures are adjusted annually in line with the consumer price index and do not cover
additional costs for more expensive brands of medicines.
To receive subsidised medicines through the PBS, each time a person gets a prescription filled they
must show their pharmacist a current Medicare card, a concession card from Centrelink or DVA, or a
PBS Safety Net entitlement or concession card. This ensures that subsidised medicines are provided
only to those who are eligible to receive them and that the person pays the amount appropriate for
their level of eligibility.
PBS Safety Net
Medicare Australia is responsible for administering the PBS Safety Net, which helps protect
individuals and families who spend a large amount on prescription medicines in a calendar year.
Each year, the government sets a general and a concession safety net threshold. The 2007 general
threshold is $1 059.00 and the concession threshold (for people holding a concession card from
Centrelink or DVA) is $274.40. Once the relevant threshold has been reached, a person can apply for
a safety net card and PBS medicines will be cheaper or free for the rest of the calendar year.
Additional costs for more expensive brands of medicines do not count towards the safety net
threshold.
To qualify for the PBS Safety Net, people need to keep a record of all PBS medicines supplied to
them or their families. They can either:

ask their pharmacist for a prescription record form and present the form whenever they have a
prescription filled, or

If they always use the same pharmacy they can ask the pharmacist to keep an electronic record.
Online claiming for PBS
Online claiming for PBS was developed in response to pharmacies’ requests for better and faster
ways to claim PBS benefits. Online claiming allows more rapid and frequent payments. It also
enables pharmacies to receive an online assessment of a prescription, including a patient’s
entitlement to the PBS, allowing errors to be corrected on the spot.
In August 2006, Medicare Australia engaged Booz Allen Hamilton to assess the viability of a rollout of
online claiming for PBS and to determine the most accelerated rate of rollout that could be achieved
with stakeholder support.
We worked closely with the Pharmacy Guild of Australia and software vendors to ensure take-up of
online claiming by addressing issues identified as barriers to take-up. By 30 June 2007, 4 490 out of
nearly 5 250 pharmacies were transmitting online – a substantial increase from the 145 pharmacies
transmitting online at the end of June 2006. We attribute this increase to the support of the Pharmacy
Guild and software vendors, a series of system improvements, an improved support model for
pharmacies and software vendors and incentives under the PBS reforms package.
Concessional entitlement validation
A key feature of the PBS online claiming system is its ability to allow a pharmacy to check a
customer’s concessional status when a PBS medicine is being dispensed. Using the online claiming
system is the most reliable and accurate way for a pharmacy to confirm that a customer has a valid
concessional entitlement.
During the early stages of the rollout in 2005, the system included an ‘override’ facility to give
pharmacies some discretion where the pharmacy was uncertain about a customer’s concessional
entitlement. Since then, Medicare Australia and Centrelink have worked to improve the quality of
concession data. In September 2006, we implemented a real-time online link with Centrelink to
improve the timeliness of the data and are now very confident about its accuracy.
The Australian Government and the Pharmacy Guild of Australia agreed to policy changes for
concessional entitlement validation. The changes, effective from 1 July 2007, include the following:

Pharmacists using online claiming for PBS will no longer be able to override advice that a patient
is not eligible for concessional benefits.

Where pharmacists are not using online claiming for PBS, patients who have not held a valid
concessional entitlement in the 12 months before the date of supply will not receive the
concessional benefit.
Authority prescriptions
Authority medications are limited to use for specific conditions and are subject to criteria set by the
Pharmaceutical Benefits Advisory Committee, which limits medical practitioners to supply by authority
prescription. Of the 2 347 PBS items listed, 1 502 are restricted to use for a particular condition or
purpose. Of these, 832 are listed as authority required.
An authority prescription also provides a mechanism for medical practitioners to prescribe an
increased supply of PBS medicine to treat an individual patient.
In 2006–07, 7.3 million authority prescriptions were approved. Of these, 7 million were handled by
telephone through our 1800 service, which operates 24 hours a day, seven days a week. The
remaining 300 000 requests for authority prescriptions were received in writing.
PBS reforms
On 16 November 2006, the Minister for Health and Ageing announced the PBS reforms package.
Medicare Australia is involved in implementing:

PBS incentives

streamlined prescribing of authority prescriptions

PBS dispensing incentives

Software vendor assistance payments.
The first two initiatives will be implemented on 1 July 2007. Our work included a comprehensive
communications strategy targeting key stakeholders, including the medical profession, consumers
and software vendors.
Table 11 – PBS reforms initiatives implemented by Medicare Australia
Initiative
Commencement date
Change to the PBS
Incentive payments to pharmacists:

PBS incentives
1 July 2007
Streamlined Prescribing of
authority prescriptions
1 July 2007
Software vendor
Assistance payments
August 2007
PBS dispensing
Incentives
1 August 2008
* multiple brands listed
40 cents per prescription to pharmacies
using online claiming for PBS and
recognising price restructuring for
medicines, or
 10 cents per concessional prescription
(concessional entitlement validation) to
eligible pharmacies registered for, but
not yet using, online claiming for PBS –
ends 31 December 2007.
Changes to the current PBS authority
process:
 Prescribers no longer have to
telephone Medicare Australia for certain
authority required PBS items. Authority
codes for these items are now listed in
the PBS Schedule.
Assistance package that provides an
incentive for software vendors to enable,
via their software, approved suppliers to
use online claiming for PBS.
This incentive has two components:
 an installation fee
 a maintenance payment.
Payments will be scaled according to the
volume of scripts transmitted by
pharmacies supported by the software
vendor.
Incentive payment for dispensing F2*
medicine:
an additional $1.50 incentive payment for
every prescription dispensed that meets
the criteria of:
 having multiple suppliers
 being substitutable
 not attracting a premium.
Approval to supply PBS medicines
Section 90 of the National Health Act enables Medicare Australia to grant approval to a pharmacist to
supply PBS medicines. Medicare Australia received 413 applications for new or relocated pharmacies
in 2006–07. Medicare Australia referred the applications to the Australian Community Pharmacy
Authority, which recommended 264 pharmacies. Of the remainder, 126 were not recommended and
23 applications were withdrawn.
Medicare Australia granted approval to:

994 community pharmacies to supply PBS medicines to the community under section 90 of the
National Health Act (including 766 changes of ownership and 162 relocations/new approvals)

22 medical practitioners to supply PBS medicines to rural or remote communities under section 92
of the Act

30 hospital authorities to supply PBS medicines to hospital patients under section 94 of the Act
(16 private hospitals and 14 public hospitals participating in the pharmaceutical reforms).
This brought total approvals at 30 June 2007 to:

4 976 section 90 approved community pharmacies

83 section 92 approved medical practitioners

184 section 94 approved hospitals (52 private hospitals and 132 public hospitals participating in
the pharmaceutical reforms).
Fourth Community Pharmacy Agreement
The Fourth Community Pharmacy Agreement represents a five-year collaborative relationship
between the Australian Government and The Pharmacy Guild of Australia from 1 December 2005 to
30 June 2010.
The agreement offers incentive payments to community pharmacy to provide services to consumers
that are designed to improve the use of medication. These payments are administered by Medicare
Australia and are listed in table 12.
In 2006–07, we made 45 144 payments, totalling over $42 million, under the Fourth Community
Pharmacy Agreement initiatives. Pharmacies can obtain further information about payments under
the agreement from our website.
Table 12 – Payment types covered by the Fourth Community Pharmacy Agreement
Payment type
Aboriginal Health Services
– Pharmacy Support Payment
Broadband for Health/Pharmacy
Concessional Entitlement Validation Payment
Description
A financial incentive for pharmacy proprietors to
provide support services to Aboriginal health
services in rural and remote locations in
Australia.
A financial incentive, available for a limited time,
that is payable to pharmacies to help them
upgrade their personal computer systems for the
satisfactory use of broadband.
A payment to the pharmacy of 10 cents for each
PBS concessional prescription supplied.
Payment type
Home Medicines Review
Home Medicines Review – Rural Loading
Payment
Medication Review Accreditation Incentives
Quality Care Pharmacy Program
Residential Medication Management Reviews
Rural Pharmacy Maintenance Allowance
Start-up Allowance
Succession Allowance
Training incentives for Pharmacy Assistants
(TIPA)
Description
Designed to allow patients’ medication regimes
to be reviewed on the request of the patient,
medical practitioner or carer.
Designed to reimburse pharmacies in rural and
remote areas of Australia for travel costs
incurred when conducting home medicines
reviews.
A financial incentive designed to increase the
number of accredited pharmacists available to
provide medication reviews.
Payments for approved activities to embody the
professional practice standards of the
Pharmaceutical Society of Australia and to
encourage community pharmacies to achieve
and maintain accreditation.
Designed to encourage collaboration between
pharmacists and GPs and to allow greater
continuity of care to eligible aged care residents
A financial incentive to encourage pharmacy
proprietors to remain in designated rural and
remote locations in Australia.
A payment, staggered over two years, to
encourage the establishment of new pharmacies
in designated rural or remote locations.
A payment, staggered over two years, to
encourage pharmacists who want to purchase
an existing pharmacy in an identified area of
need.
A financial incentive to encourage pharmacy
assistants to undertake Certificate III in
Community Pharmacy.
Indigenous people’s access to the PBS
During 2006–07, Medicare Australia continued to administer the PBS arrangements that make
prescription medicines accessible in remote Indigenous communities.
We continued to pay pharmacists for the bulk supply of PBS medicines to remote Indigenous
communities via the Aboriginal and Torres Strait Islander Health Service and some state-funded
health services.
These arrangements under section 100 of the National Health Act currently make prescription
medicines accessible to patients receiving treatment at more than 165 remote area health services
across the Northern Territory, Queensland, South Australia, Western Australia and Tasmania.
Pharmaceutical reforms in public hospitals
Under the Australian Health Care Agreements, the Australian Government, states and territories are
reforming the supply of pharmaceuticals to eligible patients in public hospitals. Eligible patients
include:

admitted patients on discharge

outpatients

day patients accessing chemotherapy drugs.
Participating hospitals are required to adopt the Australian Pharmaceutical Advisory Council
guidelines on the continuum of pharmaceutical care between the hospital and the community.
The pharmaceutical reforms are being implemented gradually across the Northern Territory,
Queensland, Victoria and Western Australia. The Australian Government will continue to liaise with
the other states and territory, seeking agreement to implement the reforms.
At 30 June 2007, Medicare Australia had approved 132 public hospitals under these arrangements
(66 in Queensland, 58 in Victoria, six in Western Australia and two in the Northern Territory) and paid
benefits of more than $100 million.
Aged care
The Department of Health and Ageing is responsible for administering policy under the Aged Care
Act, which provides for the payment of subsidies and supplements to approved aged care providers.
On any day, about one in every 100 Australians receives care in a residential aged care service or
through a community care program.
Medicare Australia manages aged care payments on behalf of DoHA. We make payments to
approved aged care providers to help them provide quality, cost-effective care for frail, older people
and support for their carers. Our role is to provide timely and accurate payments, with a focus on
service and administrative efficiency.
Our responsibilities include the processing and payment of:

residential aged care subsidies and associated supplements for provision of high-level and lowlevel residential care

residential respite care subsidies and associated supplements for provision of short-term highlevel and low-level residential care to provide carers with relief from their caring role

Community Aged Care Package subsidies for provision of support to people with low-level
complex health needs and their carers, to enable them to remain at home

flexible aged care subsidies, including:
– extended aged care at home subsidies for provision of support to people with high-level
complex health needs and their carers, to enable them to remain at home
– extended aged care at home dementia subsidies for provision of dementia-specific support to
people with high-level complex health needs and their carers, to enable them to remain at
home
– Transition care subsidies for provision of shortterm rehabilitation care to recipients after care in
hospital, pending access to longer term care.
In 2006–07, we processed 34 832 residential claims, 12 219 Community Aged Care Package claims
and 3 456 flexible care claims. These made up over $6 billion in aged care benefits.
Table 13 – Aged care – key business results
2005-06*
2006-07*
Number of residential claims processed
23 691
34 832
Number of CACP *** claims processed
8 014
12 219
EACH ** (including dementia-specific EACH)
1 130
2 897
transition care
56
559
Total flexible care claims processed
1 186
3 456
Total claims processed
32 891
50 507
Total amount paid
$3.9 billion
$6.3 billion
Number of residential aged care services (aged
care homes)
2 931
2 873
Number of CACP services (facilities providing
CACPs)
1 012
1 054
227
378
27
73
Flexible care claims:
Number of flexible care services (facilities
providing
EACH transition care)
Number of active services transmitting (eBusiness)
* Payments function transferred to Medicare Australia on 20 October 2005
** EACH = extended aged care at home
*** CACP = Community Aged Care Package
Aged care online claiming
Medicare Australia introduced online claiming for the aged care sector using a three phase release
process, the final phase of which was implemented in November 2006. The online claiming solution
enables a seamless integration into the normal operating environments of aged care providers and
state government aged care assessment teams. The aged care sector can now lodge and validate
information electronically, in real time. Medicare Australia developed this solution in collaboration with
DoHA, according to the requirements outlined by aged care providers and their software vendors.
New payment system project
The establishment of a new aged care payment system was announced in the 2004–05 Budget as
part of Investing in Australia’s Aged Care – Streamlining administration for better care. The
Department of Health and Ageing commissioned Medicare Australia to design, develop and
implement the system which would handle claims assessments and payments and integrate
seamlessly with Medicare Australia’s online claiming system.
Medicare Australia will be providing the technical platform for the new Aged Care program by
redeveloping the existing solution using a robust computing solution. New functions required for the
Aged Care program will then be progressively introduced over the life of this redevelopment program.
Australian Organ Donor Register
The Australian Organ Donor Register, which is administered by Medicare Australia, provides a simple
way for people to record their consent (or objection) to becoming organ or tissue donors.
The register ensures that an individual’s wishes can be verified by authorised personnel 24 hours a
day, seven days a week, anywhere in Australia. In the event of a registered person’s death,
information about their decision will be accessed from the donor register and provided to their family.
From July 2005, the register became operational as a ‘consent’ register, recording a person’s legally
valid consent to donate organs. Before then, only a person’s intention to donate was registered. The
details of people who had previously recorded their intention to donate are retained on the register
until they complete a consent registration form.
Wide distribution of the organ donation brochure and registration form during 2006–07, through
Medicare offices and state-based organ donor agencies, created broader awareness and increased
general registrations. The register was also promoted through doctors’ surgeries and the Medicare
Australia website.
Medicare Australia supported Australian Organ Donor Awareness Week in February 2007 with
targeted promotions in Medicare offices, on our website and through the Good Health TV network in
some doctors’ surgeries. The key message during the week was ‘Organ donors save lives’.
More than 950 000 people have registered their consent to organ or tissue donation on the Australian
Organ Donor Register. This figure includes the ‘intent’ registrations of 16–17-year-olds.
Table 14 – Australian Organ Donor Register – key results
2005-06
2006-07
% change
791 320
951 417
+20.2%
Number of registrations of
potential organ donors*
4 823 095
4 764 895
–1.2%
Number of serviced calls to
enquiry line
40 585
32 867
–19.0%
Number of consent registrations
(including intent
registrations of 16–17-year-olds)
* Potential organ donors are those people who had previously registered their intent but have not
updated this to consent to donate.
The donor register website encourages people to ‘sign on to save lives’ by registering online and
provides general information about organ and tissue donation for transplantation, the numbers of
registered organ and tissue donors and an online registration mechanism.
Authorised medical personnel, who have signed confidentiality agreements covering the access and
use of personal information, can access the donor register through a secure internet site. They are
authorised by a management committee comprising representatives from Medicare Australia, DoHA
and state organ donation agencies.
Australian Childhood Immunisation Register
The Australian Childhood Immunisation Register is a national database established in January 1996.
The aim of the register is to improve the rate of ageappropriate immunisation and to support parents
and immunisation providers by providing information about a child’s immunisation status, regardless
of where the child was immunised.
Details of vaccinations given to children under seven living in Australia are recorded on the register
and are available on request to authorised immunisation providers and each child’s parent or
guardian.
There is a secure area on Medicare Australia’s website that provides a channel for providers to
access and update children’s immunisation details.
Health professionals use the register to monitor immunisation coverage and service delivery and to
identify regions at risk during disease outbreaks. Coverage information can be at the local, state,
territory or national level.
Data from the Australian Childhood Immunisation Register also provides:

an optional immunisation history statement that informs parents and guardians of their child’s
recorded immunisation history

information about a child’s immunisation status to help determine eligibility for the Child Care
Benefit and Maternity Immunisation Allowance Family Assistance payments

information for the delivery of feedback reports and incentive payments to eligible immunisation
providers

Reporting mechanisms to assist the Australian Government’s monitoring of national immunisation
programs.
In 2006–07, a revised brochure for parents explaining the immunisation register was distributed
through Medicare offices and immunisation providers. Medicare Australia participated in baby expos
and health information days to promote and educate people about the register.
At 30 June 2007, nearly two million children under seven were included on the register. In 2006-07,
66 680 child immunisation history statements had been viewed online and 60 492 child immunisation
history statements had been provided over the counter in Medicare offices.
During 2006–07, $8.4 million was paid to immunisation providers and 3.9 million valid immunisations
were recorded.
Table 15 – Immunisation rates of children in Australia – key business results
2005-06
2006-07
% Change
Children under 7 years
registered at 30 June
1.9 million
1.9 million
0.0%
Valid immunisation episodes
recorded at 30 June
4.0 million
3.9 million
–2.5%
90.7%
91.2%
+0.5%
92.4%
92.5%
+0.1%
Children aged 12–15 months
appropriately immunised at 30
June
Children aged 24–27 months
appropriately immunised at 30
June
Children aged 72–75 months
appropriately immunised at 30
June
Total amount paid to
immunisation providers
2005-06
2006-07
% Change
83.9%
87.9%
+4.0%
$8.3 million
$8.4 million
+1.2%
General Practice Immunisation Incentives Scheme
The General Practice Immunisation Incentives Scheme provides financial incentives to GPs who
monitor, promote and provide immunisation services to children under the age of seven years. The
scheme aims to encourage at least 90 per cent of medical practices to achieve immunisation
coverage of 90 per cent of children under the age of seven.
Providers are kept up-to-date on changes to the scheme by:

content on Medicare Australia’s website, which includes statistics, general program information
and downloadable forms for providers and Divisions of General Practice

representation at various professional meetings and workshops

Field officers in each state and territory, who provide support and information about the scheme to
practices and GPs.
The General Practice Immunisation Incentives Scheme is made up of three components.
1. Service Incentive Payment – an $18.50 payment to GPs and other medical practitioners who
notify the Australian Childhood Immunisation Register of a vaccination that completes an
immunisation schedule.
2. Outcomes Payment – a financial reward for practices that achieve 90 per cent or greater
proportions of full immunisation.
3. Immunisation Infrastructure Funding – funds administered by DoHA and provided to Divisions of
General Practice, state-based organisations and the National GP Immunisation Coordinator to
increase the proportion of children at local, state and national levels who are immunised.
By May 2007, the scheme involved 5 499 registered practices. The average immunisation coverage
rate for practices was calculated at 91.4 per cent for 2006–07, with 76 per cent of participating
practices achieving rates of 90 per cent or higher.
Table 16 – General Practice Immunisation Incentives Scheme payments – key business results
2005-06
2006-07
% Change
Practices registered (calculated
at May 2007)
5 491
5 499
+0.1%
Service Incentive Payments
(SIPs)
$18.8 million
$21.4 million
+13.8%
Outcomes Payments
$16.4 million
$16.2 million
–1.2%
Highest quarterly outcomes
payment
$10 301
$10 534
+2.3%
Average outcomes payment
$994
$1 011
+1.7%
Total payments (SIPs +
Outcomes)
2005-06
2006-07
% Change
$35.2 million
$37.6 million
+6.8%
Practice Incentives Program
The Practice Incentives Program (PIP) provides a number of incentives to help general practices
improve the quality of patient care. Practices must be accredited or working towards accreditation
against the Royal Australian College of General Practitioners’ Standards for General Practices. The
PIP is part of a blended payment approach for general practices. Payments made through the
program are in addition to other income earned by the GPs and the practice, such as patient
payments and Medicare rebates.
Medicare Australia assesses all applications from general practices and administers the program on a
day-to-day basis. DoHA has overall policy responsibility for the PIP, including the determination of
eligibility criteria.
On 23 November 2005, the Minister for Health and Ageing announced changes to the PIP to simplify
and improve the program. Changes made in 2006–07 included:

simplification of the information management/information technology incentive to a two-tier system

extension of the practice nurse/allied health worker incentive to urban practice nurses under the
Workforce Shortage initiative

changes to the asthma and diabetes incentives to introduce a cycle of care

changes in GP procedural eligibility requirements to enable rural GPs to access the Tier 4 GP
procedural incentive

Replacement of the mental health incentive with new MBS items for the three-step mental health
process.
Practices may qualify for any or all of the 11 PIP components, which are described in the following
table.
At 30 June 2007, 4 784 practices were registered as participating in the PIP. Over $279.1 million was
paid in incentive payments during 2006–07.
Table 17 – Types of Practice Incentive Program payments
Payment type
After-hours care
Asthma
Cervical screening
Diabetes
Description
Payments to practices to ensure that patients have access
to 24-hour care, including after-hours home visits where
necessary
Payments to practices for providing the asthma cycle of
care and payments to GPs who complete asthma cycle of
care for patients with moderate to severe asthma.
Payments to practices that achieve targets in cervical
screening and payments to GPs who screen women aged
20–69 years who have not had a Pap smear for four years
or more.
Payments to practices that achieve targets in providing
care
Payment type
Description
for their patients with diabetes and payments to GPs for
providing diabetes care according to best practice
guidelines.
Payments to practices for providing data to the Australian
Government, using electronic prescribing software to
generate the majority of scripts and having the capacity to
send and receive data electronically.
Payments to GPs for using the three-step Mental Health
Process with their patients.
Payments to practices in eligible rural, remote or urban
areas of workforce shortage and payments to Aboriginal
medical services, to assist them to employ or retain the
services of a practice nurse, Aboriginal health worker
and/or allied health worker.
Payments to practices to support the provision of
procedures such as surgery, anaesthetics and obstetrics in
rural and remote areas.
Payments to practices that participate in the quality use of
medicines program endorsed by the National Prescribing
Service.
A rural loading applied to the PIP payments of practices
where the main location is outside a capital city or other
major metropolitan area.
Information management/ information
technology
Mental health
Practice nurses/ allied
health workers
Procedural GP payment
Quality Prescribing Initiative
Rurality
Teaching
Payments to practices for teaching medical students.
Table 18 – Practice Incentive Program services – key business results
2005-06
2006-07
% Change
Number of practices participating
at 30 June
4 745
4 784
+0.8%
Provision of data to the Australian
Government
4 745
4 784
+0.8%
Electronic prescribing
4 417
nil*
n/a
Capacity for electronic transfer
4 480
nil*
n/a
IM/IT Tier One
Nil
4 029
n/a
IM/IT Tier Two
Nil
3 883
n/a
Ensuring patients have access to
24-hour care
4 601
4 652
+1.1%
Provision of at least 15 hours care
from the practice
2 858
1 731
–39.4%
After-hours care
2005-06
2006-07
% Change
Provision of at least 10 hours care
from the practice**
262
1 367
n/a
Provision of all after-hours care for
practice patients
1 296
1 312
+1.2%
83 496
90 316
+8.2%
Quality Prescribing Initiative
1 203
1 058
–12.1%
Procedural GP
337
354
+5.0%
Practice nurses and/or allied health
1 756
workers
2 161
+23.1%
Cervical screening
3 187
3 221
+1.1%
Diabetes
2 023
2 110
+4.3%
Total amount paid
$261.8 million
$279.1 million
+6.6%
Teaching
Number of teaching sessions
Targeted incentives
IM/IT = Information management/information technology
* Incentives were replaced with IM/IT Tier One (Basic) and Tier Two (Enhanced) in November 2006.
** Provision of at least 10 hours care from the practice commenced in May 2006.
Rural Retention Program
The Rural Retention Program aims to improve health care for people in rural and remote areas of
Australia through a system of incentive payments to medical practitioners practising in those areas. It
encourages medical practitioners to remain in rural and remote practices beyond the current average
period of two years and rewards those who do. This is expected to result in improved access to
primary health care, greater stability and continuity in medical services and improved health
outcomes for Australians living in such areas.
There are two components of the program.

The Central Payments System – administered by Medicare Australia since December 1999. This
system seeks to recognise GPs’ contributions in rural and remote locations, based on their
Medicare service data over a number of years.

The Flexible Payments System – administered by state-based and territory-based rural workforce
agencies since December 2000. This system recognises long-serving GPs who do not receive an
equitable level of support under the Central Payments System because Medicare does not
capture their services or their locations are not adequately taken into account.
During 2006–07, Medicare Australia made 2 110 payments totalling $20.4 million to 2 085 providers
participating in the Rural Retention Program.
Table 19 – Rural Retention Program – key business results
2005-06
2006-07
% Change
Number of payments
made
2 071
2 110
2 110
Total amount paid
$20.3 million
$20.4 million
+0.5%
General Practice Registrars’ Rural Incentive Payments Scheme
Since 2000, funds totalling over $100 million have been used to boost general practice training in
rural and remote areas through the dedicated 250-place Rural Training Pathway, which operates
alongside the primarily urban General Training Pathway.
To be eligible for rural training incentive payments, registrars must be formally registered in the Rural
Training Pathway. Registrars qualify by completing a period of service in one or more of the four
categories of eligible rural and remote locations. However, exceptions apply for registrars undertaking
Advanced Rural Skills Posts, procedural, special skills and mandatory elective training.
The rural, remote and metropolitan area location categories are:
1.
2.
3.
4.
5.
6.
7.
capital city
other metropolitan centre
larger rural centre
small rural centre
other rural area
remote centre
other remote area.
Financial incentives are offered to medical practitioners who undertake training in the Rural Training
Pathway in practices in small rural centres and areas, or remote areas, that can particularly benefit
from the scheme, as determined under a seven-part location classification system (for more
information about the system, go to www.health.gov.au). Up to $60 000 is available per registrar
over the three years of general practice training. Incentive payments are not available to registrars
undertaking their mandatory hospital training.
In 2006–07, Medicare Australia made payments totalling $7.5 million to 467 medical practitioners
participating in the General Practice Registrars’ Rural Incentive Payments Scheme.
Table 20 – General Practice Registrars’ Rural Incentive Payments Scheme – key business results
2005-06
2006-07
% Change
Number of medical
practitioners paid
426
467
+9.6%
Number of payments
made
786
887
+12.8%
Total amount paid
$6.7 million
$7.5 million
+11.9%
Training for Rural and Remote Procedural GPs Program
The objective of the Training for Rural and Remote Procedural GPs Program is to help GPs in rural
and remote areas attend relevant training, up-skilling and skills maintenance activities. The program
has two components:

a grant for the cost of up to 10 days training, including the cost of locum relief, to a maximum of
$20 000 per GP per financial year for procedural GPs practising in surgery, anaesthetics or
obstetrics in areas other than capital cities

a grant for the cost of up to three training sessions, to a maximum of $6 000 per GP per financial
year, for GPs practising emergency medicine in areas other than capital cities and metropolitan
centres to attend approved skills maintenance and up-skilling activities.
The expansion of the program to include larger rural centres in the emergency medicine component
and increase the grant amounts was introduced on 16 April 2007 and payments may be backdated to
include activities undertaken from 1 January 2007. The expansion of the program to include
metropolitan centres in the surgery, anaesthetics or obstetrics component and increase the grant
amounts was introduced on 30 May 2007.
Table 21 – Training for Rural and Remote Procedural GPs – key business results
2005-06
2006-07
% Change
Number of providers
paid
767
2 487
+224.3%
Number of payments
made
1 514
3 296
+117.7%
Total amount paid
$5.4 million
$9.9 million
+83.3%
Compensation Recovery Program
The Compensation Recovery Program, which began in February 1996, is administered by Medicare
Australia on behalf of DoHA under the provisions of the Health and Other Services (Compensation)
Act 1995 (HOSC Act).
The program aims to prevent ‘double dipping’ in Medicare and nursing home benefits and residential
care subsidies paid by the Australian Government in relation to an injury or illness, where a person
has already received compensation for the injury or illness. Where the amount of compensation is
more than $5 000 (including costs), the value of the benefits or subsidies must be repaid.
To identify the amount of benefits or subsidies required to be repaid, Medicare Australia issues a
Medicare history statement listing all Medicare services received from the date of injury to the date of
judgement or settlement. The claimant is required to identify those services relating to the
compensable injury or illness and return the statement to Medicare Australia. These services are then
calculated to establish the repayment amount, if any.
Compensation payers and claimants have a number of ways in which to repay the government:
advance payment option, non-advance payment option and bulk payment agreement.
An advance payment is a payment, equal to 10 per cent of the total amount of compensation set at
judgement or settlement, made by the compensation payer. The amount must be sent to Medicare
Australia within 28 days of judgement or settlement. This allows the remaining 90 per cent to be
released to the claimant immediately. Any debt is deducted from the advance payment, with any
excess being refunded to the claimant. If the advance payment does not cover the debt, the claimant
is required to make up the difference.
In 2006–07, Medicare Australia experienced a slight, but expected, decrease in the number of cases
finalised and the value of recoveries following on from changes made to the HOSC Act in 2001–02,
which streamlined the administration of the program. Changes to legislation at a state level in relation
to workers’ compensation, also tightened access to payments.
Table 22 – Compensation recovery cases and benefits – key business results
2005-06
2006-07
% Change
Cases finalised
49 232
46 561
–5.4%
Total amount of
benefits recovered
$31.3 million
$29.0 million
–7.3%
HECS Reimbursement Scheme
The Higher Education Contribution Scheme (HECS) Reimbursement Scheme was announced in the
2000 Budget as part of the more doctors, better health services regional health strategy. The scheme
aims to promote careers in rural medicine and increase the number of doctors in rural and remote
areas. For the purposes of the HECS Reimbursement Scheme, a designated rural area is defined as
rural, remote and metropolitan area categories 3 – 7 locations.
These locations are large rural centres, remote centres and smaller rural and remote centres.
Participants who undertake training or provide medical services in rural and remote areas of Australia
have one-fifth of their HECS debt reimbursed for each year of service. Through the scheme, as more
doctors move to work in rural areas, communities gain improved access to health services and
benefit from better general health levels over the longer term.
During 2006–07, Medicare Australia made 528 payments totalling $2.7 million to 411 medical
graduates participating in the HECS Reimbursement Scheme.
Table 23 – HECS Reimbursement Scheme – key business results
2005-06
2006-07
% Change
Number of eligible
medical graduates
participating
421
411
–2.4%
Number of medical
graduates paid
272
313
+15.1%
Number of payments
made
440
528
+20.0%
Total amount paid
$2.1 million
$2.7 million
+28.6%
Family Assistance
Family Assistance aims to give Australian families better access to a range of government payments
and services. It operates in over 550 offices throughout Australia, including Medicare offices,
Centrelink customer service centres and Australian Taxation Office shop fronts.
The main payments and services provided by Family Assistance include:

Family Tax Benefit (part A), which provides help with the cost of raising children

Family Tax Benefit (part B), which provides extra help for families with one main income, including
sole parents

Child Care Benefit, which offsets the cost of long and part-day child care

Maternity Payment, which helps with the extra costs of a new baby

Maternity Immunisation Allowance, which is a separate payment for children who have been fully
immunised.
Since the commencement of Family Assistance in July 2000, Australian families have been able to
access limited Family Assistance services at Medicare offices. During 2006–07, in partnership with
Centrelink and ahead of schedule, Medicare Australia completed an ambitious program to extend
Family Assistance services at all Medicare offices. The extended services include claims processing
and handling of all levels of enquiries.
With the extension of Family Assistance services, Australian families can now have their claims for
Maternity Payment, Maternity Immunisation Allowance, Child Care Benefit and Family Tax Benefit
processed when they visit their local Medicare office. They can also change their income estimate,
method of payment and contact details.
Satisfaction with Medicare Australia’s provision of extended Family Assistance services has been
independently measured. Results show strong support from people accessing the extended services,
both for the level of service and for the greater choice about where to access the services.
At 30 June 2007, nearly 670 000 families had accessed extended Family Assistance services in
Medicare offices since the rollout began in July 2005.
Table 24 – Family Assistance services – key business results
2005-06
2006-07
% Change
Services provided to
families*
380 405
653 288
+71.7%
Medicare offices
offering access to
extended services
190
238
+25.3%
Number of people
accessing extended
Family Assistance
services
129 025
538 160
+317.1%
* Services include the number of forms submitted for payment and number of enquiries to Medicare
offices.
LPG Vehicle Scheme
During 2006–07, the Australian Government established the LPG Vehicle Scheme to assist private
motorists with the purchase of a new LPG (liquefied petroleum gas) vehicle or the conversion of a
new or used petrol or diesel vehicle to LPG. While DITR oversees the scheme, Medicare Australia
and Centrelink are the public contact points for enquiries and applications. Centrelink is responsible
for paying approved grants.
The scheme was launched on 14 August 2006 and applications were available from Medicare and
Centrelink offices from 1 September. Payments of grants began on 1 October.
Since the introduction of the scheme, Medicare Australia offices have received over 44 000
application forms. This is nearly 70 per cent of the total applications received under the scheme.
Table 25 – LPG Vehicle Scheme – key business results
2006-07
Number of applications received
44 013
Percentage of applications received by Medicare Australia
66.9%
Hearing Services Program
The Australian Government provides hearing services and products to eligible people under the
Hearing Services Program, which is administered by the Office of Hearing Services in DoHA. While
the Office of Hearing Services manages all policy and eligibility aspects of the program, Medicare
Australia processes and pays claims to accredited hearing service contractors on the office’s behalf.
In 2006–07, we processed 917 208 services and made payments totalling $215.3 million to
accredited hearing service contractors. Approximately 95 per cent of all claims are submitted
electronically.
Table 26 – Hearing Services Program services and payments – key business results
2005-06
2006-07
% Change
Services processed*
898 483
917 208
+2.1%
Total amount paid**
$203.1 million
$215.3 million
+6.0%
* Service provided to individuals
** Payments made to hearing contractors
National Bowel Cancer Screening Program
Following the success of the Bowel Cancer Screening Pilot Program and as part of its Strengthening
Cancer Care initiative in the 2005–06 Budgets, the Australian Government allocated $43.4 million
over three years for the phased introduction of a national bowel cancer screening program.
The program aims to reduce the number of people who die from bowel cancer, which is the most
common internal cancer affecting Australians and the second most common cause of cancer-related
deaths after lung cancer. Early diagnosis of bowel cancer or pre-cancerous abnormalities has been
shown to increase the chance of survival.
The program began in August 2006 and will continue until 30 June 2008. Medicare Australia has
entered into a service arrangement with DoHA to provide services relating to the administration of
aspects of the program, including the establishment and maintenance of the National Bowel Cancer
Screening Register.
In administering the screening register, Medicare Australia is responsible for:

identifying and inviting eligible participants to screen and re-screen at appropriate intervals, using
Medicare and DVA enrolment files

issuing reminders to participants

recording participants’ screening and detection histories

establishing and operating the program information line for the general public and health
professionals

overseeing the provision of mailing house services for the program

making payments to medical professionals for services and the transfer of data to the register

establishing eight information manager positions.
The information managers focus on following up participants and program data, developing
relationships with key stakeholders and providing specialist advice and training on electronic data
transfer to the register.
During 2006–07, we established the register and sent invitations to more than 405 000 eligible
participants for a bowel screen. The calls received by the information line are general enquiries such
as: opt out or suspend from program after receiving invitation; the caller’s eligibility for the program;
and response to correspondence sent by the register. We will continue this work during 2007–08,
identifying remaining eligible participants and distributing around 600 000 invitations to take part in
the screening program.
Table 27 – National Bowel Cancer Screening Register – key business results
2006-07
Invitations distributed
405 608
Faecal occult blood test results processed
125 592
Information line calls received
50 003
Medical indemnity
The Australian Government’s medical indemnity framework comprises five schemes to strengthen the
longer term viability of the medical insurance industry and create an environment in which the
industry can operate successfully. This is being achieved through the provision of financial support to
reduce the impact of large claims and by making medical indemnity insurance more affordable for
medical practitioners. Medicare Australia is responsible for the administration of the schemes under
the Medical Indemnity Act.
Medical Indemnity UMP
Support Payments During 2006, DoHA received approval to create a United Medical Protection
(UMP) Support Payment day (17 November 2006) for individuals who had not received notification of
their liability for past contribution years. Amendments to the Medical Indemnity Regulations 2003 took
effect on 30 March 2006 and all affected providers were contacted.
Incurred but Not Reported Indemnity Claims Scheme
Under the Incurred but Not Reported (IBNR) Indemnity Claims Scheme, the government covers the
costs of claims from medical defence organisations that do not have adequate reserves to cover their
liabilities. To date, United Medical Protection Limited is the only medical defence organisation actively
participating in the scheme. The scheme covers IBNR indemnity claims and UMP Support Payments.
Ongoing costs associated with the scheme are partly funded through a contribution payment (the
UMP Support Payment) imposed on those people who were members of United Medical Protection
Limited on 30 June 2000.
Table 28 – UMP Support Payments
2005-06
2006-07
Number of members invoiced a
UMP Support Payment
10 131
10 168
Total amount invoiced
$13.7 million
$13.2 million
Table 29 – IBNR Indemnity Scheme claims processed – key business results
2005-06
2006-07
Number of claims received
375
166
Total benefits paid
$14.8 million
$9.5 million*
* A $39 million reduction in the outstanding claims provision, as assessed by the Australian
Government Actuary, has not been included in this figure.
High Cost Claims Scheme
Under the High Cost Claims Scheme, the government funds 50 per cent of the cost of medical
indemnity insurance payouts that are greater than the applicable threshold amount, up to the limit of a
medical practitioner’s insurance cover. This scheme has three threshold levels, which are dependent
on the date the claim was first notified to the insurer.
Notification dates (inclusive)
Threshold amount
1 January 2003 to 21 October 2003
$2 000 000
22 October 2003 to 31 December 2003
$500 000
On or after 1 January 2004
$300 000
In 2006–07, Medicare Australia paid benefits of $8.8 million for the 10 claims received.
Exceptional Claims Scheme
Under the Exceptional Claims Scheme introduced in November 2003, medical practitioners are
protected against personal liability for eligible claims that exceed the level of their insurance
cover.The scheme has two threshold levels, which are dependent on the date the claim was fi rst
notifi ed to the insurer. To date, no claims have been submittedagainst this scheme.
Notification date
Threshold amount
1 January 2003 to 30 June 2003
$15 000 000
On or after 1 July 2003
$20 000 000
Run-off Cover Scheme
Under the Run-off Cover Scheme, the government will guarantee funding for claims against eligible
medical practitioners who have left the private medical workforce and been provided with free run-off
cover. A Run-off Cover Scheme support payment, paid by medical indemnity insurers to the
government since 1 July 2004, will meet the cost of funding claims over time. Under the scheme,
medical indemnity insurers will be reimbursed implementation and compliance costs under section
34ZN (1)(c) of the Medical Indemnity Act.
Premium Support Scheme
Under the Premium Support Scheme, eligible medical practitioners receive financial assistance
through asubsidised reduction in their insurance premium costs, effective from 1 July 2004. Insurers
are then reimbursed the subsidised amount by the government.
The Premium Support Scheme is designed to ensure that, if a doctor’s gross medical indemnity costs
exceed 7.5 per cent of their gross private medical income, they will pay 20 cents in the dollar for the
cost of the premium beyond that threshold limit.
Competitive Advantage Payment
Under the Competitive Advantage Payment scheme, medical indemnity insurers that benefit from the
IBNR Indemnity Scheme are required to make a payment to the government that refl ects their level
of competitive advantage. To date, Australasian Medical insurance Limited is the only insurer to have
made acompetitive advantage payment($56 million in 2005–06).
Table 30 – Run-off Cover Scheme
2005-06
2006-07
Total implementation fees paid
$1.8 million
$nil
Total administration fees paid
$2.8 million
$nil
Table 31 – Premium Support Scheme participation and revenue – key business results
2005-06
2006-07
Total eligible practitioners
4 139
6 858
Total amount paid
$17.1 million
$50.0 million
Total administration fees
$2.2 million
$2.3 million
30% Rebate on Private Health Insurance
The 30% Rebate on Private Health Insurance program continues to be a major lever in the Australian
Government’s initiative to encourage a mix of private and public provision of health services.
All Australians who are eligible for Medicare and who are members of registered health funds, are
eligible for the rebate. Medicare Australia administers the program on behalf of the Australian
Government and works with DoHA, the Australian Taxation Offi ce, the Private Health Insurance
Advisory Council and health funds to improve the program’s administration.
While the program is still known as the 30% Rebate, the Australian Government expanded the
program on 1 April 2005 to include a 35 per cent rebate for people aged from 65 to 69 years
(inclusive) and a 40 per cent rebate for people aged 70 years and older.
During 2006–07, the 35 per cent and 40 per cent rebates were applied to around 579 000 claims per
month, resulting in an additional $194.7 million being paid by Medicare Australia. The number of
registered health fund memberships increased by 6.3 per cent. Cash claims paid directly to
individuals remained at $2.1 million and health fund payments increased to $3.3 billion.
Table 32 – 30% Rebate on Private Health Insurance – key business results
2005-06
2006-07
% Change
Number of memberships registered
4.8 million
5.1 million
+6.3%
Total paid in cash claims
$2.1 million
$2.1 million
0.0%
Total paid to health funds
$3.0 billion
$3.3 billion
+10.0%
Audits of 12 health fund entities that participate in the program through the Private Health Insurance
Premium Reduction Scheme were carried out during 2006–07. The aim was to identify differences
between Medicare Australia data and health fund data relating to the registration of people who pay
reduced premiums for private health insurance cover.
Any differences were identifi ed by comparing the registration records held by health funds with our
records. The audit measured the risk associated with Medicare Australia paying a health fund for a
policy that is not eligible for the premium reduction scheme.
We also audited health fund procedures for identifying and processing dishonoured member
contributions. These audits were designed to assess the impact on claims under the premium
reduction scheme and the validity and completeness of member applications for the scheme retained
by health funds.
The health fund procedures audits established the extent to which claims for payment made by health
funds were accurately calculated; correct in respect of payments madeby the member and supported
by member application; and were claims for valid articipants in the scheme.
The audits concluded that current procedures reduced the risk of incorrect or inappropriate payments
to health funds, but recommended further improvements to make data more complete and provide
evidence for participant validity. The audited health funds implemented the recommendations.
Program risk management
During 2006–07, Medicare Australia’s Program Review Division began work on two Budget
measures:


fraud and compliance – increasing Medicare compliance through education
Improved cross agency activities.
The first initiative reflects our commitment to making it easy for the public and health care providers to
comply, while the second supports more sharing of data and intelligence between Medicare Australia
and other DHS agencies.
Our compliance program is based on a risk management approach involving activities to educate
stakeholders and to detect, prevent and correct non-compliance.
Education
Education and communication are important in our approach to supporting voluntary compliance. The
broad focus of these activities is to make it easy for medical practitioners, pharmacists and patients to
understand the requirements when they bill or claim for services under Medicare or prescribe, supply
or receive medication under the PBS. This section outlines key activities completed in 2006–07.
Face-to-face and online education activities
Medicare Australia supported face-to-face education sessions on a wide range of topics to support
better access to and correct use of the MBS and the PBS for new and experienced health care
providers.
Online PBS education accredited by the Royal Australian College of General Practitioners and the
Australian College of Rural and Remote Medicine contributed to continuing professional
development.
Figure 5 – Summary of face-to-face and online education activities in 2006–07
* Other includes workers from the Aboriginal Medical Service, pharmacy technicians and practice
staff.
Table 33 – Compliance Program – publications and advertising
Communication Channel
(approximate circulation)
Examples of topic






Prescribing restricted medicine, including
single-dose eye drops, injectable antibiotics
and combination anti-glaucoma agents
Specialist trainees, private patients and
Medicare
Requesting pathology services
Overseas drug diversion
Prescription shopping goes online
Sending PBS medication overseas
Prescribing restricted medication


PBS random compliance audit
Multiple payments audit

Article: How and when to write a non-PBS
prescription
Software advertising: overseas drug
diversion and prescription shopping
Article: How and when to write a non-PBS
prescription

Forum (up to 41 000)
Bulletin Board (up to 5 300)
Medical Director (up to 21 000)
Medical Observer (up to 23 000)


YMCA Backpacker magazine (up to 73 000)

Taking and sending PBS medicine overseas
Lightbox advertising in overseas departure
terminals in Brisbane, Sydney, Perth and
Adelaide Video loop advertising on Skybus

Taking and sending PBS medicine overseas
Communication Channel
Examples of topic
(approximate circulation)
Advertisements in community newspapers
Radio announcements on community stations

Promoting awareness of overseas drug
diversion issues among culturally and
linguistically diverse groups
Table 34- Distribution of information on Medicare or PBS
Materials
PBS and You CDs
Overseas drug diversion
information sheets
Getting more medicine
than you
need: Prescription
Shopping
Program brochure
Non-PBS prescription
sticky
notes and private
prescription
stamps
Topics
Comprehensive introduction to the PBS
and to prescribing PBS medicine for new
medical practitioners
Information to medical practitioners,
pharmacists and the public on taking or
sending PBS medicine overseas
Quantity
3 177
20 530
(including17
languages*)
To provide medical practitioners and
pharmacists with information to explain
to their patients the problems with getting
more medicine than necessary
14 460
Explains why non-PBS prescription is
necessary and that the patient will pay full
cost for the medicine at the pharmacy.
Stamps ensure prescribers’ intentions are
clear when writing a non-PBS prescription
671 orders
* Including Arabic, Bosnian, Chinese, Croatian, Farsi, Filipino, Greek, Hindi, Indian, Italian, Khmer,
Korean, Macedonian, Russian, Serbian, Turkish and Vietnamese.
Fraud awareness training for Medicare Australia staff
Medicare Australia provides training on fraud awareness to new staff as part of their induction and to
current staff in Medicare offices to maintain their awareness of fraud.
In 2006–07, we provided fraud awareness training sessions for 1 616 staff members in our state
offices.
Travelling with PBS Medicine Enquiry Line
The Travelling with PBS Medicine Enquiry Line (1800 500 147) is an initiative of the Overseas Drug
Diversion Program. The program targets individuals who might illegally send or carry PBS medicine
overseas. The enquiry line advises on the rights and responsibilities of Australians when travelling.
Figure 6 - Number of calls to the Travelling with PBS Medicine Enquiry Line, 2005–06 and 2006–07
In 2006–07, the enquiry line received 6 126 calls. Theaverage number of calls permonth in 2006–07
was 511.
Detection
Medicare Australia identifies potential non-complianceby medical practitioners, pharmacies and
pharmacistsand patients by using tip-offs, interagency intelligence, random sampling of claimingdata
and targeted detectiontechniques.
Fraud hotline
Members of the public can report suspected fraud by phone through the Australian Government
Services Fraud Tip-Off Line (131 524) or online through the Medicare Australia website
(www.medicareaustralia.gov.au).
Calls that warrant further assessment are assigned as cases and referred to the states from which
the calls were made. In 2006–07, 2 315 calls to the hotline resulted in 768 being referred for further
assessment.
Our Program Review Division also receives tip-offs about potential fraud cases from thepublic via fax,
mail and email and from other areas within the agency, such as staff who detect suspicious claim
patterns or behaviour. From October 2006 to June 2007, the division received 1175 tip-offs and
referrals, more than 97 per cent of which were assigned as cases for further assessment.Because of
system changes; data for the first quarter of 2006–07 is not available.
Random compliance audit programs
Random compliance audits are post-payment reviews that focus on whether the Medicare service or
PBS supply that was claimed and paid for by Medicare Australia was actually provided to patients.
In 2006–07, two random compliance audit programs were undertaken, using records randomly
selected from Medicare and PBS claiming and payment data.
Preliminary findingsfrom these audits were reported to the Australian National Audit Offi ce in July
2007 as part of the supporting evidence for Medicare Australia’s 2006–07 financial statements.
Detailed reports of the findingsare expected to be finalised in 2007–08.
Targeted compliance audit programs
In 2006–07, Medicare Australia planned to carry out 12 programs of audits targeting potential noncompliance. The following table summarises the status of these audits at 30 June 2007.
Table 35 – Random compliance audit programs
Audit
Details
Number audited
Medicare
Number of Medicare services
(randomly selected)
2 227 services
PBS
Number of PBS scripts (randomly
selected)
5 376 scripts
Table 36 - Targeted compliance audit programs
Targeted Area
Status (at 30th June 2007)
Practice Incentive Payments
To be completed in 2007–08
Private Health Insurance Rebate Scheme
Completed (report is being prepared)
Medical Indemnity
Completed (report is being prepared)
Multiple payments (multiple claiming by
pharmacies)
Paediatric referrals
To be completed in 2007–08
Completed (report is being prepared)
Targeted Area
Status (at 30th June 2007)
Electronic bulk billing
Completed (report is being prepared)
Care Plan
Completed (report is being prepared)
Allied health workers
To be completed in 2007–08
Broadband for Health
Completed (report is being prepared)
Home Medicines Review Program
To be completed in 2007–08
Concessional entitlement validation (bulk bill)
To be completed in 2007–08
Specialised drugs (Glivec and Herceptin)
Completed (report is being prepared)
Data assessments, intelligence reports and artificial intelligence analysis
Medicare Australia builds and maintains analytical tools that use sophisticated intelligence and datamining techniques to scan and assess patient, medical practitioner and pharmacy/pharmacist
populations for anomalous behaviour.
Data assessments
In 2006–07, we completed 18 data assessments to identify incorrect claiming and inappropriate
servicing. The assessments covered Medicare and PBS claims worth around $470 million. The table
below summarises selected assessments.
Intelligence reports
Medicare Australia uses intelligence analysis systems and processes to highlight potentially criminal
activity, particularly in the areas of criminal associations, misuse of the PBS and identity fraud. Our
tools include advanced geospatial and association charting systems.
In 2006–07, we prepared 29 intelligence reports: 23 to provide information supporting our own
investigations and compliance operations and six to provide information for the development of future
Medicare Australia compliance operations and to forward to other agencies.
Artificial intelligence analysis
In 2006–07, outputs from artificial intelligence analysis provided data for the Practitioner Review
Program. This form of analysis has also been expanded to assess PBS claims data to identify
anomalous behaviour by pharmacies.
Table 37 – Data assessments
Focus of the assessment
Approximate number
assessed
Benefit Assessed
Potential incorrect claiming of
anaesthetic
700 medical practitioners
$6.6 million
22 000 prescribers
$2.8 million
item (Item 42702) for eye lens
surgery
Potential inappropriate
prescribing of Cox-2 medicines
Focus of the assessment
Approximate number
assessed
Potential incorrect claiming of
1 900 medical practitioners
diagnostic percutaneous biopsy
item (Item 30094)
Potential misuse of
8.4 million patients
concessional
23 000 medical practitioners
Entitlement
Benefit Assessed
$9 million
$360 million
Table 38 – Artificial intelligence analysis
Analysis
General Practitioner Risk
Analysis System
PBS Risk Analysis System
Outcomes
For each quarter:
 MBS claims data from around 22 000 GPs was reviewed
 Around 170 GPs were referred for assessment to
determine if further action was required.
Trial of PBS Risk Analysis System (using PBS claims data,
September 2006):
 PBS claims data from 5 736 pharmacies reviewed
 177 pharmacies referred for assessment to determine if
further action was required
Correction
As a result of detection activities, depending on the nature and significance of detected noncompliance, Medicare Australia may:





tell individuals of the behaviour that we have observed
recover benefits paid incorrectly
ask the Director of Professional Services Review to review possible inappropriate practice by
medical practitioners
investigate and refer the matter to the Commonwealth Director of Public Prosecutions for criminal
prosecution where fraud is detected
Where fraud by medical practitioners is proven, refer the matter to Medicare Participation Review
Committees for determination of disqualification.
Prescription Shopping Program
The Prescription Shopping Program aims to protect the PBS by focusing on patients who obtain PBS
medicines beyond their medical need. It operates by providing information to selected patients, their
prescribers, or both. The information is tailored to support medical practitioners (mainly GPs) in
making more informed decisions about their patients’ therapeutic requirements. The program consists
of a contact component and an information service.
Contact with medical practitioners
We contact medical practitioners through the mail or in face-to-face meetings to give them information
about patients whom we suspect are prescription shopping. We also write to patients, notifying them
of our concerns and advising them that we have contacted their medical practitioners.
Figure 7 – Medical practitioner contacts in 2005–06 and 2006–07
In 2006–07, Medicare Australia sent letters to or met 8694 medical practitioners to discuss 4 515
patients suspected of prescription shopping.
Prescription Shopping Information Service
Since 31 January 2005, Medicare Australia’s Prescription Shopping Information Service has been
providing medical practitioners with information on patients whom they suspect are prescription
shopping.
In September 2006, we made a number of enhancements to improve the timeliness of data and to
give prescribers online access to patient reports.
Figure 8 – Calls to and reports by the Prescription Shopping Information Service in 2005–06 and
2006–07
In 2006–07, the service received 18 259 calls and sent 3 812 patient reports. Compared to 2005–06,
the number of calls has increased by 16 per cent (2 469) and the number of reports sent increased by
22 per cent (685).
Overseas Drug Diversion Program
The Overseas Drug Diversion Program focuses on individuals who may be illegally sending or taking
PBS medicines overseas. The program provides education and communication on the rights and
responsibilities of Australians when they take PBS medicines overseas, including through the
Travelling with PBS Medicine Enquiry Line (1800 500 147). Medicare Australia also works with the
Australian Customs Service and Australia Post to detect and prevent the illegal export of PBS
medicines through international airports and mail exchanges.
From 13 to 15 March 2007, Medicare Australia conducted Operation Brillpen, a joint operation with
the Australian Customs Service, at Sydney International Airport and Sydney International Mail
Exchange as part of the Overseas Drug Diversion Program.
There were five incidences where PBS medicines were detained at the mail exchange. At the airport,
a substantial number of passengers were found to be carrying PBS medicines with a letter from their
medical practitioner in reference to their medicines. This underlines the success of our campaign to
inform the travelling public about the needto carry such documentation.
Operation Brillpen was covered by Channel 7’s top rating Border Security television program. The
screening of the operation should increase public awareness of the Overseas Drug Diversion
Program and its aims.
Thirty cases of potential illegal exports of PBS medicines were detected in 2006–07. Most of the
medicines were detained and earmarked for destruction and the exporters were issued with warning
letters.
In May 2007, an Australian man was convicted of possessing an excessive quantity of PBS
medication after a joint Medicare Australia – Customs operation at Sydney International Airport. The
medicines were detected inside the man’s luggage while he was trying to board a flight to Vietnam.
He was sentenced to a six month good behaviour bond and ordered to pay court costs.
Recovery of benefits incorrectly paid
In 2006–07, Medicare Australia initiated action to recover $3.37 million in incorrect payments from
499 individuals. The payments were identified through audits, investigations and reviews. Details of
these recoveries are in the following table.
Table 39 – Recovery identified and to be repaid
Groups
Number
Amount
Medical practitioners
184
$1 695 388
Pharmacies/pharmacists
230
$679 626
Patients/members of public
77
$53 074
Other
8
$458 598
Total
499
$3 369 686
Investigation
When possible fraud is detected in programs administered by Medicare Australia, we investigate for
potential prosecution. Prosecution is at the extreme end of the range of compliance intervention
options available to us.
In 2006–07, we began550 investigations, completed487 and referred 79 to the Commonwealth
Director of Public Prosecutions.
At 30 June 2007,423 investigations were ongoing, of which 92 (22 per cent) had been open for 12
months or longer, continuing a trend since January 2007. There is a correlation between the length of
an investigation and the complexity of the case. Investigations into fraud by medical practitioners,
pharmacies or pharmacists and into sophisticated public frauds (possibly involving multiple entities
and intricate corporate and financial networks), take longer than investigations of fraud by individual
members of the public.
In 2006–07, the Commonwealth Director of Public Prosecutions successfully prosecuted
56individuals referred by Medicare Australia for committing frauds against our health-related
programs. The following table summarises those prosecutions.
Practitioner Review Program
Medicare Australia reviews medical practitioners’ where claims data indicates that their claiming or
prescribing practice profile differs from that of their peers.
The Practitioner Review Program took effect from1 November 2006, replacing the earlier Practice
Profile Review Process. We contacted practitioners who were subject to a profile review at that time
and provided them with a factsheet outlining what the change would mean for them.
In 2006–07, we completed a review of 324 medical practitioners through the Practitioner Review
Program and sent requests concerning26 medical practitioners to the Director of Professional
Services Review for review for possible inappropriate practice.
The Professional Services Review is a peer review process established in 1994to examine suspected
cases of inappropriate practice. Professional Services Review (PSR) exists to protect the integrity of
Medicare and the Pharmaceutical Benefits Scheme (PBS).
Medicare Australia sends requests to the Director of Professional Services Review to review any
medical practitioner who fails to address our concerns through the Practitioner Review Program.
Following the review, the Director can either decide to take no further action, negotiate and enter into
an agreement with the medical practitioner, or refer the medical practitioner to a Professional
Services Review Committee. The decision of the committee is then referred to the Determining
Authority to decide the sanctions to be applied to the medical practitioner.
Table 40 – Summary of successful prosecutions, 2006–07
Population
Number
Recoveries
Medical practitioner
2
$28 379
Pharmacies/pharmacists
1
$4 021
Members of the public
53
$280 527
Total
56
$312 927
In 2006–07, the Director of Professional Services Review made fi nal determinations on 17 cases:
two cases were from previous determinations, six were for reprimand under section 92 of the Health
Insurance Act, two were dismissed under section 91 and seven were for counsel and reprimand
under section 93. Repayments from the determinations totalled nearly $0.9 million.
Suspension or revocation of approval to supply under the PBS
Under section 133 of the National Health Act, the approval for pharmacists to supply PBS medicines
and claim PBS benefits can be revoked by the Minister for Health and Ageing or suspended by the
Secretary of DoHA.
In 2006–07, Medicare Australia considered using the section 133 process in two cases, but did not do
so, as court proceedings are continuing in relation to both pharmacists.
Medicare Participation Review Committees
Medicare Participation Review Committees (MPRCs) are independent statutory committees
established on a case-by-case basis under Part VB of the Health Insurance Act. The role of the
MPRC is to make independent determinations on whether a medical practitioner, or a person, should
maintain the right to participate in Medicare.
MPRCs are able to suspend access to Medicare when:




a medical practitioner has been convicted of a relevant offence
a medical practitioner has been found under the Professional Services Review Scheme to have
engaged in inappropriate practice on two separate occasions
a medical practitioner or pathology company is reasonably believed to have breached a pathology
undertaking
A medical practitioner or person is reasonably believed to have engaged in prohibited diagnostic
imaging practices.
The maximum penalty able to be applied as a result of an MPRC determination is five years total
disqualification from participation in Medicare programs.
In 2006–07, Medicare Australia referred two medical practitioners to the MPRC. During the year, the
MPRC held three hearings and made fi ve determinations. Details of MPRC determinations in 2006–
07 are provided in the following table.
Table 41 – Medicare Participation Review Committee determinations
Case
Medical
practitioner
(GP)
Medical
practitioner
(GP)
Medical
practitioner
(Optometrist)
Medical
practitioner
(Optometrist)
Medical
practitioner
(GP)
Reasons for referrals
Determination
The medical practitioner was
convicted of a relevant offence
in 2005–06 as a result of false
and misleading statements in
relation to Medicare claims
The medical practitioner came
before the MPRC as a result of
two findings of inappropriate
practice through the
Professional Services Review
Scheme
Pleaded guilty to dishonestly
causing a loss to a
Commonwealth entity contrary
to section 135.1(5) of the
Criminal Code
Convicted of 38 charges under
section 134.1 of the Criminal
Code.
Pleaded guilty to obtaining
property by deception
Pleaded guilty to 122 offences
(which were rolled into one
charge) in relation to billing
Medicare Australia for services
that were not provided to
patients
Disqualification from providing
MBS services in all
metropolitan areas for a period
of eight weeks (excluding
remote areas)
Disqualification from all MBS
services for 18 months
Effective 25 September 2006
Reprimand Effective 13
October 2006
Reprimand Effective 14
December 2006
Disqualification from all MBS
services for one month
Effective 21 April 2007
Medicare Australia online
Medicare Australia’s online claiming facility was introduced in 2002 to enable medical providers to
lodge claims (including Medicare bulk bill, patient claims and DVA claims) and to submit information
to the Australian Childhood Immunisation Register over the internet.
Medicare Australia has been working closely with providers to implement online claiming and seek
feedback about its use. Practices are continuing to register to use online claiming at the rate of150–
200 per month.
While take-up of patient claiming for paid accounts has been lower than anticipated, bulk bill claiming
online continues to rise. The significant benefit for the Australian public is the ability to lodge claims
direct from the medical practice after the consultation, eliminating the need to visit a Medicare office.
If the account has been paid, patients can also choose to have their benefit paid directly into their
nominated bank account.
During 2006–07, we promoted online claiming through:




a presence at educational seminars
engagement with the Association of Australian Practice Managers
continued support for and engagement of business development representatives across Australia
Education of the public through posters and brochures about the convenience of online claiming.
Table 42 – Medicare Australia online
2005-06
2006-07
% Change
Number of registered
sites*
5 948
7 455
+25.3%
Number of transmitting
sites**
5 369
6 632
+23.5%
Number of bulk billed
services transmitted
43.8 million
59.2 million
+35.2%
Percentage of all bulk
bill services
24.7%
31.5%
+6.8%
Providers transmitting
bulk bill services
20 186
24 120
+19.5%
Patient claimed
services transmitted
2.9 million
4.4 million
+51.7%
Percentage of all
patient claimed
services transmitted
5.1%
7.9%
+2.8%
Providers transmitting
patient claimed
services
6 475
9 094
+40.4%
Figure 9 – Practices with Online Claiming
Figure 10 – Medical services claimed via Online Claiming July 2003 – June 2007
ECLIPSE
ECLIPSE (Electronic Claim Lodgement and Information Processing Service Environment) uses
secure internet connections between registered health benefit organisations, medical practitioners,
hospitals, billing agents and Medicare Australia to help patients lodge claims and pay accounts.
Consultation with government and the private health sector identifi ed a need for an industry-wide,
seamless eBusiness solution to streamline billing and claiming for in-hospital episodes of care. The
manual billing process was considered to be complex, inconvenient for patients and expensive. In
response, Medicare Australia released the fi rst elements of ECLIPSE in July 2004 and we have
continued work since then to upgrade the system.
During 2006–07, Medicare Australia delivered further ECLIPSE features to allow hospital claiming,
hospital online eligibility checking and overseas claiming. In-hospital claiming allows public and
private hospitals and day facilities to submit a claim in relation to the patient’s hospital stay, including
claims for accommodation, transfers and miscellaneous items, such as prosthetics.
While the components of ECLIPSE have been delivered on time and within budget, take-up by health
insurance funds has been signifi cantly slower than expected. Therefore, we are reviewing the
governance and administration arrangements for ECLIPSE, with the aim of increasing take-up. The
private health industry has indicated its support for this approach and discussions about future
operating arrangements have begun.
Table 43 – ECLIPSE
2005-06
2006-07
% Change
No. of transmitting
sites*
94
164
+74.5%
No. of simplified billing
services transmitted
70 926
157 840
+122.5%
Percentage of all
simplified billing
services
0.5%
1.1%
+0.6%
Providers transmitting
simplified billing
services
513
1 056
+105.8%
Online patient
verifications
transmitted
10.2 million
16.7 million
+63.7%
RHBOs connected to
ECLIPSE
23
29
+26.1%
79.1%
86.3%
7.2%
Percentage of privately
insured population
represented
by RHBOs** connected
to ECLIPSE
Figure 11 – Medical services claimed using ECLIPSE 2005–06 and 2006–07
Medicare Easyclaim
In August 2006, the Prime Minister announced that the government would develop Medicare
Easyclaim to allow the Medicare rebate to be claimed directly from the doctor’s surgery using
electronic funds transfer (EFTPOS) technology. The government set Medicare Australia the goal of
implementing Medicare Easyclaim from September 2007. We have been working closely with
financial institutions to develop and deliver the new claiming service.
The service will transmit both bulk bill claims and patient claims and rebates. Around15 000 medical
practices are either current or potential users of electronic claiming of some kind (EFTPOS or online
claiming).
Medicare Easyclaim is available to all doctors, including GPs and specialists and their patients.
Participating institutions
Providers of EFTPOS services that are registered with the Australian Payments Clearing Association
as participating members of the Consumer Electronic Clearing System are eligible to apply to be
accredited providers of Medicare Easyclaim. All members have been formally approached about
Medicare Easyclaim.
The contractual arrangements confer no special advantage for large participants’ and should prevent
costs shifting across the sector.
On 22 December 2006, the Commonwealth Bank of Australia and MoneySwitch Limited (trading as
Tyro Payments) signed contracts to deliver Medicare Easyclaim. National Australia Bank signed a
contract on 5 April 2007.
Banks and other financial institutions will receive a transaction payment of 23 cents (including GST)
for each claim transmitted via Medicare Easyclaim. We took this price after considering advice from
commercial, government and specialist interests.
Each participating financial institution is required to undergo a rigorous accreditation process before
being given approval to implement Medicare Easyclaim. The accreditation process covers all areas of
system development, including security, as well as marketing and provider support.
In delivering value for money, we have sought to maximise take-up by the public and doctors by
ensuring the broadest coverage of financial institutions offering EFTPOS services.
Promotion
Medicare Australia has completed phase one of an ongoing public education campaign to increase
awareness of Medicare Easyclaim among medical practitioners and their staff and to increase takeup of the system by practices. Promotional activities have included placing articles in stakeholder
publications and newsletters, posting content on our website and engaging with key health journalists.
We also ran a major direct-contact campaign with the medical industry to raise awareness and
provide information about the options available for point-of-service claiming. During this 11-week
campaign, Medicare Australia officers contacted over 15 000 medical practices and held 220
information sessions around the country. This was an extremely successful campaign. Not only did it
raise awareness of the new claiming choice, but it generated discussion on electronic claiming issues
of concern to doctors and practice managers.
Stakeholder engagement
Medicare Australia has used a comprehensive stakeholder engagement strategy as part of the
development and implementation of Medicare Easyclaim. The strategy includes ongoing engagement
and consultation with a number of peak medical bodies, including the Australian Medical Association
and the Australian Association of Practice Managers at state and national levels; many professional
colleges, including the Royal Australian College of General Practitioners and the Australian College of
Rural and Remote Medicine; and various other medical industry representative groups.
PBS online claiming
Medicare Australia has a long history of using electronic commerce. Today, Medicare eBusiness
systems allow business-to-business communication with most players in the health sector, including
medical providers, pharmacies, aged care facilities, hospitals and health funds.
During 2006–07, we worked closely with the Pharmacy Guild of Australia and major pharmacy
software vendors to improve the PBS Online system. Combined with a new incentive package
developed by DoHA, the system improvements have led to a large increase in pharmacists’ take-up
of PBS Online (see the chart below).
By the end of June 2007, 4 490 pharmacies had converted to the new online system, which provides:


real time script processing, allowing errors to be corrected at the time of entry
more frequent payments to pharmacists


real-time concessional entitlement validation at the time of dispensing, via a link between
Medicare and Centrelink
Improved reconciliation reports for pharmacies.
By April 2007, more scripts were processed by the new system than by the old disk-based system.
Figure 12 – Pharmacies using PBS Online
Figure 13 – Script lodgement methods
Online Services
Medicare Australia’s Online Services provide a convenient way for the general public to view, request
and update their information online. People who are registered for Online Services can:

view and print their Medicare Safety Net balance

view and print their child’s immunization history statement

view their organ donation decision

request a replace mentor duplicate Medicare card

view and update their personal details

View and print their Medicare benefit tax statement details.
The Medicare benefit tax statement was made available online in March 2007. The statement is
available for the previous financial year, or from the beginning of the current financial year to the date
of the request. It cans be viewed, printed and saved. Medicare office staff promoted online access to
the statement and online registrations have increased significantly since we made it available.
Medicare Australia conducts regular market research to gauge the public’s interest in proposed new
online products before they are delivered. Online services are promoted through Medicare offices,
Centrelink offices, universities and online search engines.
Medicare Australia had set an online registrations target of157 000 (one per cent of the15.7 million
eligible people) by June 2007. We achieved the target in April, three months ahead of schedule.
During 2006–07, an average of 490 Australians a day registered for Online Services, bringing the
total registered to216 142 by 30 June 2007.
Figure 14 – People registered for online services
Web services
During 2006–07, 2.75 million visits were made to Medicare Australia’s website
(www.medicareaustralia.gov.au) to access information or Online Services (10 per cent more than in
2005–06).
We launched a new website design in February 2007. The site now has a more contemporary look
and a number of enhancements to improve navigation and usability.
e-tax
From July 2006, tax return lodgers have been able to retrieve their Medicare benefit tax statement
automatically through the e-tax lodgement process. For those who lodge their personal tax return
electronically and complete the medical expenses section of the return, this service removed the
need to phone or visit a Medicare office to request a Medicare benefit tax statement. This streamlined
process was made possible through close collaboration between Medicare Australia and the
Australian Taxation Office.
Access card
The Health Benefits, Veterans’ and Social Services Access Card is proposed to replace up to 17
health benefits, veterans’ and social services cards and vouchers.
The access card project is being led by the Office of Access Card in DHS. Medicare Australia is
participating in the project through the provision of resources and by providing advice directly to the
office on technical, policy and legislative issues.
Relevant activities include:






sharing our experience from the Medicare smartcardrollout in Tasmania
providing information to support the development of key access card documents, including the
registration strategy, transition strategy, detailed business requirements, conceptual architecture
and service delivery models
analysing the impact of access card on current program delivery arrangements (for example,
Medicare, the PBS, the Australian Organ Donor Register and Australian Childhood Immunisation
Register) and making the necessary system and policy modifications
doing preparatory work to ensure that our systems are ready to support the increased number of
data transactions resulting from access card registrations(for example, upgrading the bandwidth
available in Medicare offices)
providing technical expertise to assist in the office’s procurement activities
Advising on aspects of our business model that could help manage registration demand (for
example, using expiring Medicare cards to drive take-up of access cards).
Our experience with the Medicare smartcard pilotproject in Tasmania has proved particularly useful to
informing the development of the accesscard program. The smartcard was an optional replacement
for the standard Medicare card and enabled people to choose to include their photograph on the chip
on the card.
Approximately 4 500 people registered for the Medicare smartcard and 3 008 cards were issued. The
Australia Post contract to manage smartcards in Tasmania ended on 25 November 2006.
Information technology services
Our technology channels, core application portfolio and information assets play a critical role in the
delivery of Medicare Australia services across the health sector. After our people, technology is our
largest area of investment and it is important that we get the greatest possible value from that
investment.
Medicare Australia is one of the worlds largest and most efficient health benefit information
processing agencies. We are well positioned to leverage our capabilities and unique assets, which
include:

extensive technology enabled delivery channels
 238 Medicare offices in community accessible locations across Australia offering a wide range of
services, including one-stop government access to Family Assistance services
 over 1000 Medicare Access Points across Australia
 web-enabled self service capability, including access to letters and forms 24 hours a day, seven
days a week

comprehensive consumer and provider registries
 a consumer registry of over 21 million people covered by Medicare services
 an extensive provider registry of health related organisations and practitioners
 authentication registrations through the issuing of public key infrastructure security certificates and
tokens

customer services capability based on integrated solutions
 financial management, claiming and payment systems
 public registers, such as the Australian Organ Donor Register, the Australian Childhood
Immunisation Register and the Bowel Cancer Screening Register
 service integration:working with small and large health service vendors to integrate their services
into a secure and consistent service delivery framework
 Face of government: providing the public with a one-stop capability for communicating with
government through Family Assistance Offices offering cross-agency services and the ability to
register changes of circumstance at a single point.
Each year, about 500 million transactions and more than$30 billion in payments and benefits are
processed through Medicare Australia’s information technology services at exceptional levels of
efficiency.
We play an important role as one of six DHS agencies and will continue our work to exploit synergies
among those and other agencies. We will also continue to develop our unique services, information
assets and capabilities to realize the benefits of those assets.
Key achievements in 2006–07
Our key achievements in information technology in 2006–07 included:












development of Medicare Easyclaim in partnership with a number of financial institutions
implementation of a better support model for pharmacies and suppliers of dispensing software that
has helped drive take-up of online claiming for PBS from 145 to 4 490 over the year
introduction of real-time concessional entitlement checking for PBS in partnership with Centrelink
transitioning to a new supplier for essential printing services, reducing the number of paper reports
and improving the designs of our forms and letters
implementing a new telephony platform that provides the foundation for more flexible call routing
across the organization
expanding the range of available Online Services to include concessional entitlement validation
and tax statements
partnering with DHS, including Centrelink and the Child Support Agency, to make our Online
Services available through the new DHS portal, allowing a single sign-on for the public
completing the rollout of Family Assistance services to all 238 Medicare offices
implementing the National Bowel Cancer Screening Register, an eBusiness channel for the aged
care system and changes to Medicare to give the public the option of receiving benefit payments
via EFT
adding functionality to the ECLIPSE and online claiming for Medicare systems to allow submission
of DVA hospital claims
continuing the consolidation of information and corporate reporting in the enterprise data
warehouse to provide accurate, single-source information and to remove the need for resource
intensive ad hoc reporting
Updating Medicare Australia’s Information, Communications and Technology (ICT) Strategic Plan
to take account of progress and environmental changes.
The Medicare Australia ICTStrategy is aligned with and supports the Medicare Australia Strategic
Business Direction2007–2010. The ICT Strategy will be used as a blueprint to implement a number of
key Medicare Australia strategies:









additional payment channels for Medicare online claiming
integration of the proposed access card into our services continued focus on data
cleansing and consolidation
integration of new aged care systems
web enablement of core services through the Service Office Portal front end
cross-agency information and delivery channel for consumers
leveraging of DHS agency purchasing power
enhanced fraud prevention and compliance activities
Standardisation of our data stores, including the application of standard geocodes to our address
data.
Aged care eBusiness
In 2005–06, responsibility for aged care claims processing was transferred to Medicare from DoHA.
In 2006–07, we implemented eBusiness for the aged care processing system, using our existing
eBusiness assets, capability, processes and technology.
eCertificates
Medicare Australia provides electronic registration services for the Australian health sector, including
registration for and distribution of digital keys and certificates.
We also undertake a range of other initiatives to support the integrity, validity and usability of all our
registration services, including ongoing consultation with the sector to stay abreast of changing
business needs.
Take-up of digital certificates increased significantly during 2006–07, taking the number of active
digital certificates from 19 849 on 30 June 2006 to 32 361 at 30 June 2007.
Table 44 – Active digital certificates
Total as at 30 June 2006
Total to 30 June 2007
Individual certificates
8 981
11 034
Location certificates
10 868
21 327
Total certificates
19 849
32 361
Section 05 Financial Statements
Section 06 Appendices
Appendix A – Reports required by legislation
Organisation, function and powers
Details of Medicare Australia’s organisational structure are in Section 2, About Medicare Australia.
The functions of Medicare Australia’s Chief Executive Officer are specifi ed in the Medicare Australia
Act, the Medicare Australia Regulations and functions directions issued by the Minister for Human
Services.
Medicare Australia works in partnership with the DoHA to achieve the Australian Government’s health
policy objectives. Our activities are conducted within the government policy framework set by DoHA,
DVA, FaCSIA and DITR and relevant legislation.
Medicare Australia’s functions include:











paying Medicare benefits as provided for in the Health Insurance Act and undertaking all
administrative activities necessary to ensure the effective performance of this function (authorised
by the Medicare Australia Act)
paying pharmaceutical benefits and undertaking all administrative activities necessary to ensure
the effective performance of this function (subject to the National Health Act and authorised by the
Medicare Australia Act and Regulations)
preventing and detecting the occurrence of fraud and inappropriate servicing with respect to the
payment of benefits under the programs administered by Medicare Australia (authorised by the
Medicare Australia Act)
paying aged care benefits and undertaking all administrative activities to ensure the effective
performance of this function (subject to the Aged Care Act and authorised by the Medicare
Australia Act and Regulations)
administering theCompensation RecoveryProgram (under theprovisions of the Healthand Other
Services(Compensation) Act)
administering the AustralianGovernment Private HealthInsurance Rebates (underthe provisions of
the PrivateHealth Insurance IncentivesAct and the Private HealthInsurance Act)
maintaining andadministering theAustralian Organ DonorRegister (authorised byan arrangement
madeunder section 7 of theMedicare Australia Act)
undertaking alladministrative activitiesunder the General PracticeImmunisation IncentivesScheme,
the PracticeIncentives Program,the General PracticeRegistrars’ Rural IncentivePayments
Scheme,the Rural RetentionProgram, the Trainingfor Rural and RemoteProcedures Scheme,
theHECs ReimbursementScheme and the LPGVehicle Scheme (authorisedby arrangements
madeunder section 7 of theMedicare Australia Act)
delivering services as partof the Family Assistance Office (under the provisions of the A New Tax
System (Family Assistance) Act 1999 and A New Tax System (Family Assistance)
(Administration) Act 1999 and authorised by an arrangement made under section 7 of the
Medicare Australia Act)
providing services for the processing of DVA treatment accounts (authorised by an arrangement
made under section 7 of the Medicare Australia Act)
providing services for the processing and payment of claims under the Australian Hearing
Services Program (authorised by the Hearing Services Administration Act 1997)




administering the relevant schemes under the Medical Indemnity Act and related legislation
undertaking the Prescription Shopping Project (authorised by a ministerial direction made under
section 5(1)(d) of the Medicare Australia Act)
providing ex gratia payments for survivors of the bombings that occurred in Bali, Indonesia, in
October 2002 and family members of victims and survivors
Administering various special assistance schemes, including the Tsunami Healthcare Assistance
scheme, the London Assist scheme, the Bali 2005 Special Assistance scheme and the Dahab
Egypt Bombing Healthcare Costs Assistance scheme (authorised by a ministerial direction made
under section 5(1)(d) of the Medicare Australia Act).
Details of the programs that Medicare Australia administers are in Section 4, Programs.
Decision-making powers
In 2006–07, the Minister for Human Services, Medicare Australia’s Chief Executive Offi cer and/or
Medicare Australia’s officers exercised decision-making powers, made payments and undertook
delivery of programs under the following Acts, or parts of those Acts:













Medicare Australia Act 1973
Health Insurance Act 1973
National Health Act 1953
Aged Care Act 1997
Veterans’ Entitlements Act 1986
Military Rehabilitation and Compensation Act 2004
Health and Other Services (Compensation) Act 1995
Medical Indemnity Act 2002
Private Health Insurance Incentives Act 1998
Private Health Insurance Act 2007
A New Tax System (Family Assistance) Act 1999
A New Tax System (Family Assistance) (Administration) Act 1999
Hearing Services Administration Act 1997.
Secrecy provisions
Secrecy provisions in section 130 of the Health Insurance Act and section 135A of the National
Health Act provide for the confi dentiality of information obtained by Medicare Australia in the
performance of its functions.
The secrecy provisions make it an offence for a Medicare Australia offi cer to disclose information
about a person to a third party, unless a specified exception or release provision applies. For
example, information may be released to state health regulatory authorities, such as medical and
pharmaceutical boards, in relation to matters affecting the registration of professional health
providers. There is also provision under section 130(3) of the Health Insurance Act and section
135A(3) of the National Health Act for the Minister for Health and Ageing, or an offi cer to whom this
authority is delegated, to certify that it is in the public interest for information to be released.
Section 135AA of the National Health Act and associated guidelines issued by the Privacy
Commissioner regulate the maintenance and storage of claims information and require the separation
of Medicare and Pharmaceutical Benefits Scheme databases.
Privacy Act
Medicare Australia is subject to the Privacy Act 1988, which regulates the way most Australian
Government agencies collect, handle, use and disclose personal information.
In 2006–07, we received 92 complaints about the use and disclosure of personal information we hold.
Of these complaints, 38 were found to be not substantiated and 50 were substantiated and the
appropriate action was taken. Four complaints were originally lodged with the Privacy Commissioner,
who referred them to Medicare Australia for action.
In accordance with the Privacy Act, Medicare Australia submits an annual report to the Privacy
Commissioner listing the types and use of information we hold(Personal Information Digest).
Statutory report under section 42
The Medicare Australia Act provides for the Chief Executive Officer to authorise the exercising of
powers requiring a person to give information or to produce a document that is in the person’s
custody, or under the person’s control; and the power to obtain a search warrant to search and seize
evidential material, in respect of a ‘relevant’ offence, where warranted.
Section 42 of the Medicare Australia Act specifies that any uses of these powers must be reported
annually (see table below).
Table 45 – Statutory report under Section 42
Section 42(1) subsections: a
to h
2005–06a
2006–07
(a) The number of signed
instruments made under
section 8M
3
15
(b) The number of notices in
writing given under section 8P
56
44
(c) The number of notices in
writing given to individual
patients under section 8P.
Note: this is a subset of (b)
above.
5
5
(d) The number of premises
entered under section 8U
0
0
(e) The number of occasions
when powers were used under
section 8V
1
0
(f) The number of search
warrants issued under section
8Y
5
20
(g) The number of search
1
warrants issued by telephone
or other electronic means under
section 8Z
2
Section 42(1) subsections: a
to h
2005–06a
2006–07
(h) The number of patients
advised in writing under section
8ZNb
275
6 512
a. Data for 2005–06 was not included in the 2005–06 annual report. That data is included in this
annual report for reference.
b. Where powers are exercised in relation to a record containing clinical records, the Chief Executive
Officer must advise the patient in writing, except under specific circumstances, for example where,
after reasonable enquiries, the patient could not be located or contacting the patient would
jeopardise the investigation.
Occupational health and safety report
Medicare Australia is required under section 74 of the Occupational Health and Safety Act to provide
a report on occupational health and safety activities and statistics on notifi able accidents, dangerous
occurrences, investigations and notices under section 68 during the year.
Table 46 – Occupational health and safety report
Action
Number
Deaths that required notice under section 68
0
Accidents that required notice under section 68
18
Dangerous occurrences that required notice
under section 68
8
Investigations conducted under Part 4
1
Tests on plant, substance, or thing in the course
of investigations considered
0
Directions given to Medicare Australia under
section 45 (that the workplace etc not be
disturbed)
0
Notices given to Medicare Australia under
section 29 (provisional improvement notice)
1
Notices given to Medicare Australia under
section 46 (prohibition notice)
0
Notices given to Medicare Australia under
section 47 (improvement notice)
0
Appendix B – Freedom of Information
Medicare Australia is a prescribed authority under the Freedom of Information Act and is required to
publish information about the way it is organised, its functions and powers, the categories of
documents it holds and how the public can access them.
Details of Medicare Australia’s organisational structure are in Section 2, About Medicare Australia.
Appendix A sets out the organisations functions and powers.
Freedom of information statistics for 2005–06and 2006–07 are included in this appendix.
Documents held by Medicare Australia
Brochures explaining the Medicare program, the Pharmaceutical Benefits Scheme (PBS), the
Australian Childhood Immunisation Register, the Compensation Recovery Program, the Australian
Government 30% Rebate on Private Health Insurance, the Australian Organ Donor Register and
Family Assistance are available free of charge from Medicare offices.
Medicare Australia’s website (www.medicareaustralia.gov.au) features publicly available
publications and forms that can be viewed or downloaded.
Medicare Australia’s statement under section 9 of the Freedom of Information Act was updated in
March2007 and is available on the National Archives of Australia website (www.naa.gov.au).
In accordance with section 8 of the Freedom of Information Act, the following types of documents are
held by Medicare Australia and are available subject to the exemption provisions of the Act:
























administration and policy files
agendas, minutes and records of meetings of various internal and external committees and
tribunals
agendas, minutes and submissions for commission meetings
applications for approval as an accredited orthodontist
applications for approval as a dentist or dental practitioner
applications for recognitions a specialist or consultation physician
applications for recognitions a vocationally registered general practitioner
brochures relating to Medicare Australia operations
committee and tribunal files created as a result of a specific inquiry or hearing
committee and tribunal member papers
computer records relating to all Medicare Australia operations
financial budgetary documents
internal audit terms of reference, reports and fi les
legal advice and opinions
legislative documents in the form of Acts, regulations and interruptions
listings of approved Medicare practitioners and laboratories
listings of certified patients for the cleft lip and palate scheme
listings of participating Medicare medical practitioners, dentists and optometrists
listings of pathology licensed collection centres and accredited pathology laboratories
listings of PBS approved persons as defined under Sections 90 & 92 of the National Health Act
and pharmaceutical prescribers
Medicare Benefits Schedule item rulings and interpretations
Ministerial, Commonwealth Ombudsman and general correspondence
Ministerial submissions
operational instructions, circulars and directives relating to Medicare, the PBS, the Australian
Childhood Immunisation Register, the Practice Incentives Program, the Compensation








Management System, the 30% Rebate on Private Health Insurance, Veterans’ Treatment
Accounts, the Australian Organ Donor Register, the Hearing Service Payment and the Health
Research and Coordinated Care Trials
personal records
processed enrolment, registration and withdrawal forms and claims documentation relating to
Medicare Australia operations
property documents, including leases, tenders and maintenance agreements
records created as a result of a specific complaint, inquiry or review
records in relation to the regulatory functions of pathology licensed collection centres and
accredited pathology laboratories
records of contact between medical advisers and medical practitioners
statistical reports and analyses
undertakings for participating optometrists.
Procedure and initial contact points
A formal request under the Freedom of Information Actfor access to Medicare Australia documents
should be made in writing, accompanied by a $30.00 application fee made payable to Medicare
Australia and sent to:
Freedom of Information Officer
Medicare Australia
PO Box 1001
Tuggeranong DC ACT 2901
Ph: (02) 6124 7914
Fax: (02) 6124 6935
Remission of the application fee may be sought. Applicants may be liable to pay charges for costs
associated with processing a request and providing access to documents.
Freedom of Information report
The following table sets out the reportable Freedom of Information matters for Medicare Australia in
2006–07.
Table 47 – Freedom of Information requests
Requests
No. or $ amount
On hand at 30 June 2006
1
Received
14
Resolved by being:
Withdrawn (following consultation)
2
Granted in full
0
Granted in part
10
Refused in full
3
Requests
No. or $ amount
Outstanding at 30 June 2007
0
Finalised in:
0–30 days
7
31–60 days
5
61–90 days
1
91 days or more
0
Fees and levies charged
Application fees received
$360.00
Charges notified
$17 644.35
Charges collected
$1 105.00
Internal reviews
Received
1
Finalised
1
Administrative Appeals Tribunal appeals
Received
1
Outstanding at 30 June 2007
1
The table below shows Medicare Australia’s performance against Freedom of Information standards
in 2006–07.
Table 48 – Freedom of Information standards
Standard
We will acknowledge your
request under the Freedom of
Information Act 1982 within 14
days of receipt and respond
within 30 days of receiving your
request. If other parties need to
be consulted, the law provides
for another 30 days for a
decision to be made.
Performance
Performance
2005–06
2006–07
One request was carried over
and 19 requests were received
in 2005–06. Of these, 19
decisions were made and one
was carried through to 2006–
07. All were acknowledged
within 14 days of receipt. Of the
19 decisions, all were
responded to within the
legislative timeframes.
One request was carried over
and 14 requests were received
in 2006–07. Of these, 15
decisions were made and none
were carried over to 2007–08.
All were acknowledged within
14 days. Of the 15 decisions,
14 were responded to within
the legislative timeframe; one
was not, with the agreement of
the applicant.
Appendix C – Staffing
Staffing statistics
Medicare Australia has staff across Australia – in the national office in Canberra, in state
headquarters in each state, in nine payment processing and call centres and in 238 community-based
Medicare offices.
At 30 June 2007, 5 972 staff were employed by Medicare Australia under the Public Service Act. This
was an increase of 579 staff or 9.6 per cent since 30 June 2006. Increases have occurred in state
networks and are primarily aligned to Family Assistance business growth and other initiatives aimed
at reducing queue times and enhancing service.
Part-time work participation has remained constant and applies to 21 per cent of the workforce. This
is most evident through the Medicare office networks. Women comprised 81 per cent of all staff. All
staff figures are based on headcount at 30 June 2007.
Table 49 – Staff by classification and location
Staff, by classification and location
Classification National
office
NSW
Qld
SA/NT
Tas.
Vic.
WA
Total
CEO
1
0
0
0
0
0
0
1
SES Band 3
3
0
0
0
0
0
0
3
SES Band 2
9
1
0
0
0
1
0
11
SES Band 1
32
0
1
1
1
1
1
37
EL 2*
245
15
10
3
2
10
4
289
EL 1**
329
28
21
16
12
24
11
441
APS 6
285
43
23
20
3
31
13
418
APS 5
149
175
114
58
31
135
66
728
APS 4
100
97
58
36
19
83
43
436
APS 3
13
698
437
168
84
537
180
2 117
APS 2
4
179
142
57
48
179
72
681
APS 1
3
214
171
65
75
173
109
810
Total
1 173 ***
1 450
977
424
275
1 174
499
5 972
* Executive level 2
** Executive level 1
*** 214 staff report to the national offi ce directly but are located in the states. These staff are included
in state totals.
Table 50 – Ongoing and non-ongoing staff by classification
Classification
Non-ongoing
Ongoing
Total
CEO
0
1
1
SES Band 3
0
3
3
SES Band 2
0
11
11
SES Band 1
0
37
37
EL 2
0
289
289
EL 1
9
432
441
APS 6
31
387
418
APS 5
21
707
728
APS 4
26
410
436
APS 3
20
2 097
2 117
APS 2
20
661
681
APS 1
128
682
810
Total
255
5 717
5 972
Table 51 – Full-time and part-time staff by classification
Classification
Full-time
Part-time
Total
CEO
1
0
1
SES Band 3
3
0
3
SES Band 2
11
0
11
SES Band 1
36
1
37
EL 2
268
21
289
EL 1
396
45
441
APS 6
389
29
418
APS 5
687
41
728
APS 4
414
22
436
Classification
Full-time
Part-time
Total
APS 3
1 459
658
2 117
APS 2
473
208
681
APS 1
560
250
810
Total
4 697
1 275
5 972
Table 52 – Staff by gender and location
Staff, by gender and location
State
Female
Male
Total
National office
680
493
1 173*
New South Wales
1 263
187
1 450
Queensland
846
131
977
South
Australia/Northern
Territory
365
59
424
Tasmania
239
36
275
Victoria
1 011
163
1 174
Western Australia
436
63
499
Total
4 840
1 132
5 972
* 214 staff report to the national office directly but are based in the states. This staffs are included in
state totals.
Table 53 – Salary ranges for staff covered by the certifi ed agreement and AWAs
Salary ranges for staff covered by the certified agreement and AWAs
Classification
Salary range ($)
SES Band 3*
SES Band 2*
145 600–186 000
SES Band 1*
106 000–144 087
EL 2**
87 452–136 244
EL 1**
73 150 – 93 540
APS Level 6
58 000–78 000
Salary ranges for staff covered by the certified agreement and AWAs
Classification
Salary range ($)
APS Level 5
52 913–75 000
APS Level 4
49 282–56 489
APS Level 3
42 854–49 072
APS Level 2
38 660–41 722
APS Level 1
20 615–36 386
* SES Band 3 salaries have not been included, as this would enable identifi cation of individual
packages because of the small number of staff at that level.
** Salary ranges include Professional Officers in equivalent groups.
All SES employees are entitled to the use of private-plated vehicles or cash-out arrangements.
Table is based on annualised full-time pay rates.
Table 54 – Performance pay***
Performance pay
Staff groups
Staff paid
Amount paid
Average ($)
Range ($)
($)
Senior Executives
(incl. CEO)
39
198 073
5 079
612.00–16 538.00
Executive Level 2
176
653 618
3 714
406.00–10 350.00
Executive Level 1
83
234 822
2 829
540.00–6 150.00
APS 6 and below
16
21 754
1 360
372.00–2 831.00
Total
314
1 108 267
3 245
*** These fi gures relate to the performance cycle ending 30 June 2006. Payments were made in
September 2006.
Table 55 – Equity and diversity groups
Equity and diversity groups
Indigenous
Disability
NESB*
Location
Ongoing
Nonongoing
Ongoing
Nonongoing
Ongoing
Nonongoing
National office
10
0
21
1
202
11
New South Wales
18
0
27
0
376
8
Queensland
15
1
18
0
50
0
South Australia
14
2
10
0
44
2
Tasmania
7
3
7
2
8
0
Victoria
16
1
31
2
176
2
Western Australia
10
0
4
0
54
2
Total
90
7
118
5
910
25
* NESB = Non-English speaking background
Appendix D – Consultancy services
The table in this appendix lists new and extended consultancy contracts let to the value of $10 000 or
more (inclusive of GST) during 2006–07. Information for each consultancy includes the name of the
consultant, a summary description of the nature and purpose of the consultancy, the contract price for
the consultancy, the selection process used (including whether the consultancy was publicly
advertised) and the reason for the decision to employ consultancy services.
Key
Selection process
1. Open tender – a procurement procedure in which a request for tender is published inviting all
businesses that satisfy the conditions for participation to submit tenders.
2. Select tender – a procurement procedure in which the procuring agency selects which potential
suppliers are invited to submit tenders in accordance with the mandatory procurement
procedures.
3. Direct sourcing – a procurement process, available only under certain defined circumstances, in
which an agency may contract a single potential supplier or suppliers of its choice and for which
conditions for direct sourcing apply under the mandatory procurement procedures.
4. Panel – an arrangement under which a number of suppliers, usually selected through a single
procurement process, may each supply property or services to an agency as specified in the
panel arrangements.
Reason
A. Skills currently unavailable within agency
B. Need for specialized or professional skills
C. Need for independent research or assessment
Table 56 – Consultancy services provided to Medicare Australia in 2006–07
Consultant’s
name
Purpose of
engagement
Price ($)
Process
Reason
Boston Consulting
Group
Advice on
Medicare
Australia’s
approach to
managing
significant
organisational
change
828 000
4
a/c
Booz Allen
Hamilton
Review of the
transfer of aged
care functions
329 091
4
c
SMS Consulting
(M&T)
Review of
Medicare
Australia’s audit
and compliance
programs
245 899
4
a/c
Booz Allen
Hamilton
Benchmark the
deployment of
PBS Online to
pharmacies
192 049
4
b/c
Pricewaterhouse
Coopers
Provision of
specialist support
in audit and
assurance
132 000
4
b
SMS Consulting
(M&T)
Advice and
assistance in
establishing
project
governance
framework
Development of a
framework for
end-to-end
business
modelling
108 955
4
a/c
94 244
3
b
Development of a
leadership
program for
Senior Executive
Service officers
84 344
3
b
Holocentric Pty
Ltd
Dattner Grant Pty
Ltd
Consultant’s
name
Purpose of
engagement
Price ($)
Process
Reason
Wendy Bloom &
Survey of
Associates Pty Ltd Medicare
Australia Online
Services
80 762
3
b
Ernst & Young
Assistance with
preparation of
Capital Asset
Management Plan
75 906
4
b/c
Valcare Pty Ltd
Development of
an Indigenous
Employment Plan
75 482
3
a/b
SMS Consulting
(M&T)
Development of a
business case for
use of the SMS
and email
communication
channels
75 075
4
a/c
Ucomm Pty Ltd
Develop and
implement an
internal
communications
strategy and
change
management
framework
59 318
3
b
SMS Consulting
(M&T)
Advice on
possibility of
providing
electronic
Centrelink forms
and medical
certificates
59 125
4
b/c
Uncommon
Knowledge
Complete 2006
customer
satisfaction
surveys
58 212
3
a/c
Acumen Alliance
Advice on
management of
contracts and
procurement
57 915
4
c
Consultant’s
name
Purpose of
engagement
Price ($)
Process
Reason
within Medicare
Australia
IT Newcom
Provision of IT
benchmarking
and sourcing
advice
56 000
3
b/c
Urbis Keys Young
Research into
Indigenous
access to major
health programs
54 988
1
c
Booz Allen
Hamilton
Specialist banking
advice to support
Easyclaim project
54 671
4
b
Acumen Alliance
Review of
Information
Technology
Services Division
accounting
processes and
procedures
50 023
4
a/c
Excelerated
Consulting Pty Ltd
Advice on and
assistance with
maintaining and
developing
Medicare
Australia’s Budget
Management
System
41 646
3
a/b
Pricewaterhouse
Coopers
Business
continuity
planning
38 500
4
b
Australian
Government
Actuary
Revaluation of
Medicare
Australia’s assets
38 280
3
c
Acumen Alliance
Development of a
strategy to
support Medicare
Australia’s
financial
forecasting
function
29 700
4
a/c
Consultant’s
name
Purpose of
engagement
Price ($)
Process
Reason
Beames &
Associates
Financial
statement quality
assurance
services
25 254
3
c
HBA Consulting
Review of impact
of Family
Assistance office
functions on job
classifications
24 628
3
c
Merry Beach
Code of Conduct
reviews and
reports
23 751
3
c
Ernst & Young
Information
technology
security advice
and assessments
23 325
4
b
Interaction
Consulting Group
Review of
framework for
people
management
policies and
guidelines
20 890
3
c
Beames &
Associates
FMA Act review
19 492
Pricewaterhouse
Coopers
Data integrity
review of
Consumer
Directory
19 392
4
c
KPMG
Review of Activity
Based Costing
Model
18 700
4
a/c
Qualitative and
Quantitative
Social Research
Customer
satisfaction
research
18 300
3
c
16 500
3
b
Conferences Pty
Ltd
Health for Industry Review of
Attendance
Management
Program
Consultant’s
name
Purpose of
engagement
Price ($)
Process
Reason
Marilyn Roche
Code of Conduct
review and report
14 973
3
c
World Wide
Webster Pty Ltd
Security advice on 13 939
electronic
procurement
system
4
c
Workrisk Services
Pty Ltd
Assistance in
12 510
preparation of an
Occupational
Health and Safety
Action Plan for the
South Australian
and Northern
Territory areas
3
b
Total
3 171 839
Appendix E – Advertising and market research
Section 311A of the Commonwealth Electoral Act requires Australian Government agencies to report
all payments of $10 300 or more made to advertising agencies or to organisations carrying out market
research, polling, direct mailing or media advertising.
The following table outlines the use of such agencies by Medicare Australia in 2006–07.
Table 57 – Advertising and Market research
Payee
Purpose
Amount
Instinct and Reason
Annual customer satisfaction
research
$109 989.00
Lote Marketing Pty Ltd
Focus testing of translated
information kits
$33 000.00
Wendy Bloom and Associates
Online Services customer
research
$56 430.00
Wendy Bloom and Associates
Qualitative market research
$84 359.00
Market Research
Polling
No polling undertaken during
period
Payee
Purpose
Amount
To conduct recruitment
advertising and standard noncampaign Medicare Australia
advertising
$874 324.00
Forum newsletter mailed out to
doctors*
$43 289.00
Media Advertising
hma Blaze Pty Ltd
Direct mail
National Mailing and Marketing
* Postage costs not included
Appendix F – Contact details
Table 58 – Office locations
National office
134 Reed Street North
Greenway, Australian Capital Territory 2900
Phone: (02) 6124 6333
Fax: (02) 6282 5025
Postal address:
PO Box 1001
Tuggeranong DC, Australian Capital Territory
2901
State offices
New South Wales
Tasmania
130 George Street
242 Liverpool Street
Parramatta, New South Wales 2150
Hobart, Tasmania 7000
Phone: (02) 9895 3333
Phone: (03) 6125 5333
Fax: (02) 9895 3082
Fax: (03) 6125 5700
Queensland
Victoria
444 Queen Street
595 Collins Street
Brisbane, Queensland 4000
Melbourne, Victoria 3000
Phone: (07) 3004 5333
Phone: (03) 9605 7333
Fax: (07) 3004 5410
Fax: (03) 9605 7980
South Australia
Western Australia
209 Greenhill Road
11th Floor, Bankwest Tower
Eastwood, South Australia 5063
108 St Georges Terrace
Phone: (08) 8274 9333
Perth, Western Australia 6000
Fax: (08) 8274 9371
Phone: (08) 9214 8333
Fax: (08) 9214 8322
National telephone enquiry service and email contacts
People can contact Medicare Australia through our national telephone service, using the numbers
listed by subject area on the following page. Calls to 1300 numbers cost 25 cents from anywhere in
Australia and calls to 1800 numbers are free. Calls from public pay phones or mobile phones may be
charged at higher rates. Further information is on our website (www.medicareaustralia.gov.au).
People can also contact us about a range of matters through the internet, using the email addresses
listed by subject area on the following page.
Table 59 – Enquiry lines open during business hours
Bowel Cancer Screening Register
1800 118 868
Compensation
132 127
Complaints and feedback line
1800 465 717
Department of Veterans’ Affairs – allied services
1300 550 051
Department of Veterans’ Affairs – hospital
services
1300 551 002
Department of Veterans’ Affairs – medical
services
1300 550 017
Doctor-shopping hotline
1800 631 181
Fraud hotline
1800 202 101
Indigenous Access line
1800 556 955
Medicare Australia online claiming
1800 700 199
Medicare Australia statistics
1800 101 099
Medicare Special Assistance
1800 660 026
Improved monitoring of entitlements
132 290
Medicare provider enquiries
132 150
Medicare public enquiries
132 011
Online Technical Support Helpdesk
1300 550 115
Optometrical IVR date-of-service check
1300 652 752
Pharmaceutical Benefits Scheme general
enquiries
132 290
Practice Incentive Program payments
1800 222 032
Rural Retention Program
1800 010 550
Simplified billing
1300 130 043
Random Compliance Audits
1800 675 235
The 30% Rebate on Private Health Insurance
1300 554 463
TTY (telephone typewriter for the hearing
impaired)
1800 552 152
Table 60 – Enquiry lines open 24 hours every day
Aged Care Online Claiming
1800 195 206
Australian Childhood Immunisation Register
enquiry line and reports
1800 653 809
Australian Childhood Immunisation Register
internet enquiry line
1300 650 039
Australian Organ Donor Register
1800 777 203
Australian Organ Donor Register (Approved
Medical Practitioner)
1800 556 455
Customs Prescription Drug Smuggling
1800 032 258
General Practice Immunisation Incentives
Scheme enquiries
1800 246 101
Travelling with PBS Medicine enquiry line
1800 500 147
PBS authority approvals
1800 888 333
Prescription Shopping Information Service
1800 631 181
Telephone claiming
1300 360 460
Table 61 – Email addresses for enquiries
Aged care
agedcare@medicareaustralia.gov.au
Australian Childhood Immunisation Register acir@medicareaustralia.gov.au
Australian Organ Donor Register
aodr@medicareaustralia.gov.au
Compensation Recovery
compensation.recovery@medicareaustralia.gov.au
Feedback reporting facility for providers and provider.feedback@medicareaustralia.gov.au
specialists
Freedom of Information
co.foi@medicareaustralia.gov.au
GPMOU 90-day scheme
90daypay@medicareaustralia.gov.au
Goods and services tax (GST)
gst.enquiries@medicareaustralia.gov.au
Information release
co.information.release@medicareaustralia.gov.au
Location Specific Practice Number
lspn@medicareaustralia.gov.au
Medicare Australia general enquiries
medicareaustralia.info@medicareaustralia.gov.au
Medicare Australia online claiming
medicareaustralia.online@medicareaustralia.gov.au
Medicare Australia media communication
and government relations
info@medicareaustralia.gov.au
Ask Adele’
adele@medicareaustralia.gov.au
Medicare Australia’s service charter
service.charter@medicareaustralia.gov.au
Medicare Australia statistics
statistics@medicareaustralia.gov.au
IBNR Indemnity Claims Scheme (medical
indemnity)
medical.indemnity.payments@medicareaustralia.gov.
au
Medicare provider enquiries
medicare.prov@medicareaustralia.gov.au
Medicare public enquiries
medicare@medicareaustralia.gov.au
Online Services support
olssupport@medicareaustralia.gov.au
Pathology
pathology.section@medicareaustralia.gov.au
Pharmaceutical Benefi ts Scheme
pbs@medicareaustralia.gov.au
Practice Incentives Program
pip@medicareaustralia.gov.au
Premium Support Scheme
pss@medicareaustralia.gov.au
(medical indemnity)
Privacy
co.privacy.policy@medicareaustralia.gov.au
Professional Review Division
professional.review@medicareaustralia.gov.au
Run-off Cover Scheme Support Payments
(medical indemnity)
rocssp@medicareaustralia.gov.au
Simplified Billing – National
simplified.billing@medicareaustralia.gov.au
Simplified Billing – New South Wales
nsw.simplified.billing@medicareaustralia.gov.au
Simplified Billing – Queensland
qld.simplified.billing@medicareaustralia.gov.au
Simplified Billing – South Australia
sa.simplified.billing@medicareaustralia.gov.au
Simplified Billing – Tasmania
Tas.simplified.billing@medicareaustralia.gov.au
Simplified Billing – Victoria
vic.simplified.billing@medicareaustralia.gov.au
Simplified Billing – Western Australia
wa.simplified.billing@medicareaustralia.gov.au
Software vendor help desk/ Medclaims
enquiries
edihelp@medicareaustralia.gov.au
Online Technical Support Vendor Liaison
otsliaison@medicareaustralia.gov.au
Online Technical Support EDI Help
edihelp@medicareaustralia.gov.au
Online Technical Support EDI Testing
edi.test@medicareaustralia.gov.au
Online Technical Support EDI Technical
Support
editech@medicareaustralia.gov.au
onlineclaiming@medicareaustralia.gov.au
Online Technical Support (Online Claiming)
Online Technical Support (ECLIPSE)
eclipse.enq@medicareaustralia.gov.au
Online Technical Support (PBS)
pbsonline@medicareaustralia.gov.au
Online Technical Support (Aged care)
agedcareonline@medicareaustralia.gov.au
Online Technical Support (Easyclaim)
eclaiming@medicareaustralia.gov.au
UMP Support Payments
umpsp@medicareaustralia.gov.au
Glossary, abbreviations and acronyms
Glossary
Benefit
The amount of rebate paid to a patient or
provider for a service.
Claim
A statement lodged by a patient or a provider
relating to a supplied service or multiple services
where the expectation is that they will receive a
benefi t. The way the claim is lodged defi nes
the maximum number of services that can be
lodged in a single claim. For example, a bulk bill
claim can contain a maximum of 80 vouchers,
with each voucher allowed 14 service items.
Gap amount
The difference between the Medicare benefit
and the schedule fee.
Out-of-hospital services
Medical services that are eligible for a Medicare
benefit and are not provided in a hospital.
Out-of-pocket
The difference between the Medicare benefit
and the doctor’s charge
Payment
Payment of a benefi t, incentive or allowance.
Schedule fee
A fee for a service that is set by the government.
Service
A medical service of an individual item number
listed under the Medicare Benefits Schedule –
sometimes referred to as a line – or an
individual prescription medicine listed under the
Pharmaceutical Benefits Scheme (PBS).
Transaction
The act of processing – for example – a medical
service for rebate, updating a patient’s details,
generating an online tax statement, or
processing a PBS script.
Abbreviations and acronyms
ANAO
Australian National Audit Offi ce
APS
Australian Public Service
ARAS
Audit and Risk Assurance Services
ATSIHS
Aboriginal and Torres Strait Islander Health
Service
DHS
Department of Human Services
DITR
Department of Industry, Tourism and Resources
DoFA
Department of Finance and Administration
DoHA
Department of Health and Ageing
DVA
Department of Veterans’ Affairs
ECLIPSE
Electronic Claim Lodgement and Information
Processing Environment
EFT
electronic funds transfer
FaCSIA
Department of Families and Community
Services and Indigenous Affairs
FOI Act
Freedom of Information Act 1982
GP
general practitioner
HECS
Higher Education Contribution Scheme
IBNR
incurred but not reported
IT
information technology
LLO
local liaison officer
MBS
Medicare Benefits Schedule
MPRC
Medicare Participation Review Committee
OATSIH
Office of Aboriginal and Torres Strait Islander
Health
OHS
occupational health and safety
PBS
Pharmaceutical Benefits Scheme
PIA
privacy impact assessment
PIP
Practice Incentives Program
RPBS
Repatriation Pharmaceutical Benefits Scheme
RRMA
rural, remote and metropolitan area
SES
Senior Executive Service
UMP
United Medical Protection