P
S
R
581

582

Health and Ageing Portfolio Agency
Section 1: Agency Overview and Resources
1.1: Strategic Direction Statement .................................................................. 584
1.2: Agency Resource Statement ................................................................... 585
1.3: Budget Measures ..................................................................................... 586
Section 2: Outcomes and Planned Performance
2.1: Outcomes and Performance Information ................................................. 587
Section 3: Explanatory Tables and Budgeted Financial Statements
3.1: Explanatory Tables ................................................................................... 592
3.2: Budgeted Financial Statements ............................................................... 592
583

PSR - Agency Budget Statements – Budgeted Financial Statements
Professional Services Review (PSR) investigates health practitioners who are suspected of inappropriate practice, on request from the Department of Human
Services. ‘Inappropriate practice’ includes inappropriately rendering or initiating health services that attract a Medicare Benefits Schedule (MBS) payment, or inappropriately making prescriptions under the Pharmaceutical Benefits Scheme
(PBS). The PSR Scheme covers medical practitioners, dentists, optometrists, midwives, nurse practitioners, chiropractors, physiotherapists, podiatrists and osteopaths, audiologists, diabetes educators, dieticians, exercise physiologists, mental health nurses, occupational therapists, psychologists, social workers, speech pathologists, Aboriginal and Torres Strait Islander health practitioners,
Aboriginal health workers and orthoptists.
Investigations are conducted by the Director of PSR who may refer the health practitioners to a committee of peers constituted by appointed PSR Panel Members and Deputy Directors.
The role and functions of PSR are set out in Part VAA of the Health Insurance Act
1973. PSR is prescribed as an Agency under the Financial Management and
Accountability Act 1997.
584

PSR - Agency Budget Statements – Agency Overview and Resources
Table 1.2.1 shows the total resources from all origins. The table summarises how resources will be applied by outcome and by Departmental classifications.
Table 1.2.1: PSR Resource Statement – Budget Estimates for 2013-14 as at Budget
May 2013
Estimate of prior year amounts
available in
2013-14
$'000
Proposed at Budget
2013-14
$'000
Ordinary annual services 1
Departmental appropriation
Prior year departmental appropriation²
Departmental appropriation 3 s31 Relevant agency receipts
Total
Total ordinary annual services
5,594
-
-
5,594
5,594
-
6,196
50
6,246
6,246
Total estimate
2013-14
$'000
Estimated available appropriation
2012-13
$'000
5,594
6,196
50
11,840
11,840
5,594
5,771
50
11,415
11,415
Other services - Bill 2
4
Departmental non-operating
Equity injections
Total
Total other services
Total available annual appropriations
Total net resourcing for PSR
5,594
5,594
-
-
-
6,246
6,246
-
-
-
11,840
11,840
-
-
-
11,415
11,415
-
-
-
Notes:
All figures are GST exclusive.
1 Appropriation Bill (No.1) 2013-14.
2 Estimated adjusted balance carried from previous year for annual appropriations.
3 Includes an amount of $0.455m in 2013-14 for the Departmental Capital Budget (refer to Table 3.2.5 for further details). For accounting purposes this amount has been designated as ‘contributions by owners’.
4 Appropriation Bill (No.2) 2013-14.
585

PSR - Agency Budget Statements – Budgeted Financial Statements
Budget measures relating to PSR are detailed in Budget Paper No. 2 and are summarised below.
Table 1.3.1 PSR Budget Measures
Part 1: Measures announced since the 2012-13 MYEFO
Part 1 is not applicable to PSR
Part 2: MYEFO measures not previously reported in a portfolio statement
Program 2012-13 2013-14 2014-15 2015-16 2016-17
$'000 $'000 $'000 $'000 $'000
Whole of Government Measures
Targeted savings - public service efficiencies 1
Professional Services Review
Departmental expenses 1.1 (20)
Total (20)
(29)
(29)
(33)
(33)
(33)
(33)
(31)
(31)
1 Measure reported includes amounts previously reported in the Health and Ageing 2012-13 Portfolio Additional
Estimate Statements (page 25).
586

PSR - Agency Budget Statements – Agency Overview and Resources
Outcome 1 – A reduction of the risks to patients and costs to the Australian
Government of inappropriate clinical practice, including through investigating health services claimed under the Medicare and Pharmaceutical benefits schemes
The Australian Government, through PSR, aims to safeguard the public against the risks and costs of inappropriate practice by health practitioners. PSR works with governments, medical and health care regulatory bodies and professional organisations to protect the integrity of the MBS and the PBS.
The PSR Scheme is part of a strong regulatory regime designed to ensure that appropriate and cost-effective clinical services are delivered. The PSR Scheme provides the legislative framework within which services provided by a health practitioner may be peer reviewed, in response to a request from the Department of Human Services. This review could be in relation to the MBS and/or the PBS, both of which are administered by the Department of Human Services. The PSR
Scheme also applies sanctions if required through the Determining Authority 1 , an independent body within the PSR Scheme.
PSR seeks to change behaviour across the health professions by deterring inappropriate practice and thereby raising awareness of the Australian
Government’s expectation of high quality health service delivery.
1 The Determining Authority is the body established by Section 106Q of the Health Insurance Act 1973 that determines the sanctions that should be applied in cases where PSR committees have found inappropriate practice, and decides whether or not to ratify negotiated agreements.
587

PSR - Agency Budget Statements – Budgeted Financial Statements
Table 2.1.1 provides an overview of the total expenses for PSR by Program.
Table 2.1.1: Budgeted Expenses and Resources for PSR
2012-13
Estimated actual
$'000
2013-14
Budget
$'000
2014-15
Forward year 1
$'000
Program 1.1: Safeguarding the integrity of the Medicare program and
Pharmaceutical Benefits Scheme
Departmental expenses
Departmental appropriation 1
Expenses not requiring appropriation in the budget year 2
Total for Program 1.1
5,789
200
5,989
5,791
171
5,962
5,823
188
6,011
Total expenses for Outcome 1 5,989 5,962 6,011
2015-16
Forward year 2
$'000
2016-17
Forward year 3
$'000
5,735
175
5,910
5,910
5,838
175
6,013
6,013
2012-13 2013-14
23 Average staffing level (number) 23
1 Departmental appropriation combines “Ordinary annual services (Appropriation Bill No 1)” and “Revenue from independent sources (s31)”.
2 Expenses not requiring appropriation in the Budget year is made up of depreciation expense, amortisation expense, makegood expense and audit fees
.
588

PSR - Agency Budget Statements – Agency Overview and Resources
Protect against inappropriate health care practice
The Australian Government, through PSR, contributes to the delivery of high quality health services by ensuring that the public is protected from the adverse consequences of inappropriate practice. PSR will collaborate with the Department of Health and Ageing, the Department of Human Services (DHS), health and medical regulatory bodies and professional organisations to ensure it achieves this aim.
PSR’s workload is dependent upon the number of cases referred by DHS. Under the DHS National Compliance Program, suspected cases of inappropriate practice by health care service providers are identified and referred to PSR. All referred cases are investigated by PSR.
Where it is found that the practitioner has practised inappropriately, sanctions can include a reprimand, counselling, repayment of MBS payments received, or partial to full disqualification from rendering or initiating MBS payments or writing PBS prescriptions. The Determining Authority imposes the sanctions as a ‘final determination’.
If, during an investigation, PSR identifies a practice that poses either a significant threat to the life or health of a patient, or does not meet professional standards, the practitioner is referred to the relevant regulatory body. Through this activity, PSR is able to integrate its activities within the broader health care regulatory framework, including state and territory health departments, registration boards and health care complaint mechanisms.
Maintain professional support for PSR
PSR is the Australian Government’s means of investigating inappropriate clinical practice. PSR utilises a peer review process and relies on the support of health practitioners and their representative registration bodies to perform its statutory function. In 2013-14, PSR will continue to work closely with the health care professions, DoHA and DHS. PSR will consult with relevant professional bodies to raise awareness of inappropriate practice issues and work with those bodies to ensure that PSR’s processes are transparent and fair.
Program 1.1 is linked as follows:
 The Department of Human Services (Services to the Community –
Program 1.1) to administer the Pharmaceutical Benefits Scheme, Repatriation
Pharmaceutical Benefits Scheme, Indigenous Access to PBS, and Medicare services and benefit payments.
589

PSR - Agency Budget Statements – Budgeted Financial Statements
Maintain professional support for PSR
Qualitative Deliverable 2013-14 Reference Point or Target
PSR will engage with governments and relevant professional and regulatory bodies to discuss the nature and cause of inappropriate practice to reduce these behaviours
Actively engage with stakeholders to provide information on the nature and cause of inappropriate practice through a variety of avenues
Protect against inappropriate health care practice
Quantitative Deliverables
2012-13
Revised
Budget
2013-14
Budget
Target
2014-15
Forward
Year 1
2015-16
Forward
Year 2
2016-17
Forward
Year 3
Percentage of reviews by the
Director of PSR finalised within 12 months
Number of committees established
Total number of matters finalised 2
100%
10
30
100%
15
40
100%
20
50
Protect against inappropriate health care practice
100%
20
50
100%
20
50
Qualitative Indicators
Positively influence health care professional behaviour
Professional bodies actively engaged in consultation
2013-14 Reference Point or Target
Analysis of available information demonstrates a positive change in health care professional behaviour by those who have been subject to a review under the PSR
Scheme
Professional bodies actively engaged in the process for appointments to the PSR Panel, and PSR receives the required number of nominees to ensure broad professional representation on the PSR Panel
2 Including section 91 no further actions, section 92 negotiated agreements and final determinations resulting from a committee hearing.
590

PSR - Agency Budget Statements – Agency Overview and Resources
Protect against inappropriate health care practice
Quantitative
Indicators
Percentage of cases referred to regulatory bodies where a possible threat to life or health of a patient is identified
Total PSR actions upheld by the courts after appeal
2012-13
Revised
Budget
2013-14
Budget
Target
2014-15
Forward
Year 1
2015-16
Forward
Year 2
2016-17
Forward
Year 3
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
591

PSR - Agency Budget Statements – Budgeted Financial Statements
Section 3 presents explanatory tables and budgeted financial statements which provide a comprehensive snapshot of agency finances for the 2013-14 Budget year.
It explains how budget plans are incorporated into the financial statements and provides further details of the reconciliation between appropriations and program expenses, movements in administered funds, special accounts and government
Indigenous expenditure.
Section 3.1.1 is not applicable to PSR.
Section 3.1.2 is not applicable to PSR.
The 2013-14 Australian Government Indigenous Expenditure (AGIE) statement is not applicable because PSR has no specific Indigenous expenses.
Section 3.2.1 is not applicable to PSR.
An analysis of PSR’s budgeted financial statements is provided below.
Departmental Resources
Comprehensive Income Statement
PSR’s level of funding in 2013-14 and the forward years is consistent with the expected number of cases it receives from the Department of Human Services each year.
The income statement deficit in the budget year and forward years is a result of the
Government decision to no longer fund for depreciation as part of ‘Operation
Sunlight’.
592

PSR - Agency Budget Statements – Agency Overview and Resources
Table 3.2.1: Comprehensive Income Statement (showing net cost of services)
(for the period ended 30 June)
EXPENSES
Employee benefits
Supplier expenses
Depreciation and amortisation
Total expenses
LESS:
OWN-SOURCE INCOME
Revenue
Sale of goods and rendering of services
Other revenue
Total revenue
Gains
Other
Total gains
Total own-source income
Net cost of (contribution by) services
Revenue from Government
Surplus (Deficit)
Surplus (Deficit) attributable to the
Australian Government
Estimated actual
2012-13
$'000
3,025
2,764
200
5,989
-
50
50
-
-
50
Budget estimate
2013-14
$'000
2,878
2,913
171
5,962
-
50
50
-
-
50
Forward estimate
2014-15
$'000
2,964
2,859
188
6,011
-
50
50
-
-
50
Forward estimate
2015-16
$'000
3,053
2,682
175
5,910
-
-
50
-
50
50
Forward estimate
2016-17
$'000
3,145
2,693
175
6,013
-
-
50
-
50
50
5,939
5,739
(200)
(200)
5,912
5,741
(171)
(171)
5,961
5,773
(188)
(188)
5,860
5,685
(175)
(175)
5,963
5,788
(175)
(175)
OTHER COMPREHENSIVE INCOME
Changes in asset revaluation reserves
Total other comprehensive income
Total comprehensive income attributable to the Australian
Government
-
-
(200)
-
-
(171)
-
-
(188)
-
-
(175)
Note: Reconciliation of comprehensive income attributable to the agency
2012-13
$'000
2013-14
$'000
2014-15
$'000
Total comprehensive income
(loss) attributable to theAustralian Government plus non-appropriated expenses depreciation and amortisation expenses
(200)
200
(171)
171
(188)
188
2015-16
$'000
(175)
175
Total comprehensive income
(loss) attributable to the agency - - - -
-
-
(175)
2016-17
$'000
(175)
175
-
593

PSR - Agency Budget Statements – Budgeted Financial Statements
Table 3.2.2: Budgeted Departmental Balance Sheet (as at 30 June)
ASSETS
Financial assets
Cash and cash equivalents
Receivables
Total financial assets
Non-financial assets
Land and buildings
Property, plant and equipment
Intangibles
Other
Total non-financial assets
Total assets
Estimated actual
2012-13
$'000
80
5,576
5,656
313
101
3
47
464
6,120
Budget estimate
2013-14
$'000
80
5,576
5,656
233
18
450
47
748
6,404
Forward estimate
2014-15
$'000
80
5,576
5,656
203
5
360
47
615
6,271
Forward estimate
2015-16
$'000
80
5,576
5,656
123
5
270
47
445
6,101
Forward estimate
2016-17
$'000
80
5,576
5,656
43
149
180
47
419
6,075
LIABILITIES
Payables
Suppliers
Other payables
Total payables
838
96
934
838
96
934
838
96
934
838
96
934
838
96
934
Provisions
Employees
Other provisions
Total provisions
Total liabilities
588
82
670
1,604
588
82
670
1,604
588
82
670
1,604
588
82
670
1,604
588
82
670
1,604
Net assets
EQUITY
Contributed equity
Reserves
Retained surpluses or accumulated deficits
Total equity
4,516
(7,344)
477
11,383
4,516
4,800
(6,889)
477
11,212
4,800
4,667
(6,834)
477
11,024
4,667
4,497
(6,829)
477
10,849
4,497
4,471
(6,680)
477
10,674
4,471
594

PSR - Agency Budget Statements – Agency Overview and Resources
Table 3.2.3: Departmental Statement of Changes in Equity — summary of movement
(Budget year 2013-14)
Opening balance as at 1 July 2013
Retained earnings
$'000
Balance carried forward from previous period
Surplus (deficit) for the period
Capital budget - Bill 1 (DCB)
Estimated closing balance as at 30 June 2014
11,383
(171)
-
11,212
Asset revaluation reserve
$'000
477
-
-
477
Other reserves
$'000
-
-
-
-
Contributed equity/ capital
$'000
(7,344)
-
455
(6,889)
Total equity
$'000
4,516
(171)
455
4,800
DCB = Departmental Capital Budget.
595

PSR - Agency Budget Statements – Budgeted Financial Statements
Table 3.2.4: Budgeted Departmental Statement of Cash Flows
(for the period ended 30 June)
OPERATING ACTIVITIES
Cash received
Appropriations
Net GST received
Other cash received
Total cash received
Cash used
Employees
Suppliers
Net GST paid
Total cash used
Net cash from (or used by) operating activities
INVESTING ACTIVITIES
Cash used
Purchase of property, plant and equipment
Total cash used
Net cash from (or used by) investing activities
Estimated actual
2012-13
$'000
5,779
326
50
6,155
Budget estimate
2013-14
$'000
5,741
331
50
6,122
Forward estimate
2014-15
$'000
5,773
342
50
6,165
Forward estimate
2015-16
$'000
5,685
342
50
6,077
Forward estimate
2016-17
$'000
5,788
342
50
6,180
3,055
2,774
326
6,155
32
32
(32)
2,908
2,883
331
6,122
-
455
455
2,964
2,859
342
6,165
-
55
55
(55)
3,053
2,682
342
6,077
-
5
5
(5)
3,145
2,693
342
6,180
-
149
149
(149)
32
32
(455)
455
455
55
55
5
5
149
149
FINANCING ACTIVITIES
Cash received
Capital budget - Bill 1 (DCB)
Total cash received
Net cash from (or used by) financing activities
Net increase (or decrease) in cash held
Cash and cash equivalents at the beginning of the reporting period
Cash and cash equivalents at the end of the reporting period
DCB = Departmental Capital Budget.
32
-
80
80
455
-
80
80
55
-
80
80
5
-
80
80
149
-
80
80
596

PSR - Agency Budget Statements – Agency Overview and Resources
Table 3.2.5: Capital Budget Statement
CAPITAL APPROPRIATIONS
Capital budget - Bill 1 (DCB)
Total capital appropriations
Total new capital appropriations represented by:
Purchase of non-financial assets
Total items
Estimated actual
2012-13
$'000
32
32
32
32
PURCHASE OF NON-FINANCIAL
ASSETS
Funded by capital appropriation -
DCB 1
- current year appropriation
- prior year appropriation
Total acquisitions of nonfinancial assets
32
-
32
Budget estimate
2013-14
$'000
455
Forward estimate
2014-15
$'000
55
455
455
455
455
-
455
55
55
55
55
-
55
Forward estimate
2015-16
$'000
5
Forward estimate
2016-17
$'000
149
5
5
5
5
-
5
149
149
149
149
-
149
RECONCILIATION OF CASH USED
TO ACQUIRE ASSETS TO
ASSET MOVEMENT TABLE
Total purchases
Total cash used to acquire assets
32 455 55 5 149
32 455 55 5 149
1 Does not include annual finance lease costs. Includes purchases from current and previous years’ appropriation
(Departmental Capital Budget).
597

PSR - Agency Budget Statements – Budgeted Financial Statements
Table 3.2.6: Statement of Asset Movements (2013-14)
As at 1 July 2013
Gross book value
Accumulated depreciation/amortisation and impairment
Opening net book balance
Buildings
$'000
395
82
313
Other property, plant and equipment
$'000
Intangibles
$'000
208
107
101
400
397
3
CAPITAL ASSET ADDITIONS
Estimated expenditure on new or replacement assets
By purchase – appropriation ordinary annual services
Sub-total
-
-
5
5
450
450
Other movements
Depreciation/amortisation expense
As at 30 June 2014
Gross book value
Accumulated depreciation/amortisation and impairment
Closing net book balance
80
395
162
233
88
213
195
18
3
850
400
450
171
1,458
757
701
Total
$'000
1,003
586
417
455
455
598