Medicare Australia Annual Report 2005 – 2006
Prepared by: Media, Communication and Government Relations Branch
Edited by: Puddingburn Publishing Services
Designed by: Cre8ive
Printed by: National Capital Print
Audited by: Australian National Audit Office
Contact: Kirk Coningham, Manager Media, Communication and Government Relations Branch
Address: Medicare Australia
134 Reed Street
Tuggeranong ACT 2901
Phone: (02) 6124 7829
Fax: (02) 6124 7416
Website: www.medicareaustralia.gov.au>About Medicare Australia>Media room>
Publications>Annual Report
© Commonwealth of Australia 2006
ISSN 0313 1041
This work is copyright protected. Apart from any use as permitted under the Copyright Act 1968, no
part may be reproduced by any process without the written permission of the Medicare Australia.
Requests and enquiries about reproduction and rights should be addressed to the Manager, Media,
Communications and Government Relations Branch, at our postal address:
Medicare Australia
PO Box 1001
Tuggeranong DC ACT 2901
ABN 75 174 030 967
Section 01
Introduction
Letter of transmittal
The Hon Joe Hockey MP
Minister for Human Services
Parliament House
CANBERRA ACT 2600
Dear Minister
It is my pleasure to present to you Medicare Australia’s Annual Report for 2005–06 as required by
section 70(1) of the Public Service Act 1999 for your tabling in Parliament.
This report has been prepared in accordance with the Requirements for Annual Reports, approved on
behalf of the Parliament of the Joint Committee of Public Accounts and Audit as required in section70(2)
of the Public Service Act 1999.
Yours sincerely
Catherine Argall PSM
11 September 2006
Chief Executive Officer’s Review
The 2005–06 financial years was one of the most challenging in our 30 year history. It was a year of
transition that has seen us emerge leaner, more focused and better equipped than ever to deliver
current and future government services to the Australian people.
The shift from the Health Insurance Commission (HIC) to Medicare Australia in October last year
introduced significant changes to our governance arrangements:
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from answering directly to a board to answering to the Minister through the Secretary of Human
Services
from the accountability framework of the Commonwealth Authorities and Companies Act 1997 (CAC
Act) to the Financial Management and Accountability Act 1997 (FMA Act) and
from being employed under the (then) Health Insurance Commission Act 1973 (HIC Act)to
employment under the Public Service Act 1999.
While effecting this major transition seamlessly, with no interruption to services, we also faced several
other considerable challenges, many of which were outlined in Minister Hockey’s Statement of
Expectations delivered to me at the end of October last year.
Our major challenges for the year were to:
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live within our means and
invest in growth and future service development.
Our overarching purpose has remained constant – improving Australia’s health through payments and
information – but this year the Minister also required that we maintain a high level of awareness of the
government’s broader reform agenda and ‘be in a position to respond fully to government policy
directions and objectives’.
Responding to these policy directions while maintaining Medicare Australia’s enviable reputation for
great service delivery has been a key focus.
Managing within our means
We restructured our national operations to ensure we were operating within agreed budget limits. The
budget situation was such that large staff cuts were as necessary as they were painful. To ensure
uninterrupted services to Australians, staffing levels in the states were maintained while we shed nearly
400 positions from our national office. The reduction in positions was carefully managed, with most
ongoing employees voluntarily transferring to other areas within Medicare Australia or the wider
Australian Public Service (APS). Only 40 redundancies were required.
We also enhanced our budget monitoring systems and revised project governance and internal costing
procedures. The governance arrangements and the tough budget decisions delivered immediate
results. The Department of Finance and Administration had approved a loss of $19.7 million for this
financial year. With strong financial management we reduced this to a once-off loss of $6.78 million.
Improving the customer experience
Whilst getting our budget under control, we also rose to the challenges outlined by the Minister,
enhancing the services we provide to the Australian people and reducing the times they need to spend
in our offices.
Specifically, the Minister asked us to reduce the number of times Australians needed to visit Medicare
offices, to reduce waiting time and improve online options while maintaining privacy and security.
We responded to these customer expectations by revising our Service Charter. This Charter builds on
our focus of delivering great service to the Australian people – whether they are the general public,
health professionals or our colleagues within Medicare Australia and more broadly, the APS. Our
promises to the public reflect what they have told us is important to them. It is also what we expect from
one another in the workplace: ‘make it easy for me’, ‘get it right’, ‘be genuinely interested in me’,
and ‘respect my rights’. To keep us honest, our promise to deliver was linked to a new telephone
feedback line and a set of strong performance indicators which we made available to the public.
The revised charter complemented changes to corporate branding, signage and Medicare office
design, presenting a new look Medicare and introducing Family Assistance services.
The office makeovers include comfortable seating, better queue management systems and focus on
sit-down client interaction which is more comfortable and personal. Our promise to serve the public
more quickly was achieved with 98.6 per cent of customers served in less than 10 minutes with an
average queue wait time of 1 minute and 57 seconds.
New services provide more choice and flexibility for families who can now access Family Assistance
services, including maternity payment and family tax benefit, at their local Medicare office.
As at 30 June 190 offices had rolled out Family Assistance services with the remaining 48 due to be
rolled out by the end of 2006. The roll out is part of the Department of Human Services’ (DHS) ambition
to incorporate a whole-of-government approach in the delivery of services across the country.
We have also addressed the Minister’s focus on better serving Indigenous Australians. For example,
we opened a new and improved regional office in the Northern Territory, which is now supported by 15
staff. Where Indigenous Australians couldn’t come to us, we went to them. Medicare staff, in close
cooperation with territory health and other DHS agencies, travelled to remote communities to promote
better health and the use of Medicare. Medicare services are now also provided through 49 Centrelink
sites throughout the Northern Territory, Western Australia and Queensland. These efforts have built on
recent years’ success, with approximately 98 per cent of Indigenous people in the Northern Territory
now enrolled in Medicare; including an average of one hundred Indigenous babies a month.
During the year we also worked with the Australian Tax Office (ATO) on a joint online initiative to make
the Medicare tax statement available as an ‘on-demand’ service for all users of the Tax Office’s e-tax
application. Each year more than 380,000 letters are generated through requests for the Medicare tax
statement. This new service requires no paper or postal services and delivers the tax statement directly
into the tax payer’s returns.
We expect our national network and reputation will also be a major asset in the roll out of the health
and social services access card. The access card will enhance the customer experience in many ways,
including consolidating and replacing 17 different cards currently in government service. We have
worked closely with our colleagues in DHS to help prepare the way for the new card. Our smartcard
rollout in Tasmania provided vital information that will be applied in the national rollout. We have also
been closely involved in advising the Minister on a broad range of issues relating to the card.
Aged Care
As an indication of our growing reputation for the management of health payments, Medicare Australia
assumed responsibility for the aged care payments function from the Department of Health and Ageing
(DoHA) in October 2005. In the 2005/06 financial year, 32,891 aged care claims were processed,
resulting in a total of $3.9 billion in payments.
During the transition process, approximately 120 staff transferred to Medicare Australia from DoHA. An
independent review conducted by Price water house Coopers found that full business continuity was
maintained, with no disruption of services to aged care providers.
Forms & letters
Another key area of concern for the Minister was in improving our communication with the public,
particularly through forms and letters. Our audit of forms and letters showed annual volumes of about
17 million forms and more than 20 million letters. While the overhaul task is daunting, we made good
progress through the year:
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we worked with Centrelink to introduce a vastly simplified new born enrolment form, removing
duplication of 250,000 forms and relieving some of the administrative stress on new parents
we also combined seven dental provider application forms into one, extracting red tape from some
250,000 annual applications
the introduction of new online capacity for card replacements and address change requests has the
potential to remove three million hard copy forms per year.
Our attack on the red tape addresses the first promise in our new service charter, ‘make it easy for me’.
Another change to our forms was designed to save lives rather than trees.
All Medicare claim forms now incorporate organ donor registration options.
Online services
Another means via which we are delivering better service, and reducing the amount of time Australians
need to spend in our offices, is through better use of online technology.
The 05-06 financial years saw some major advances in the Medicare Australia services people could
access online. As at 30 June a range of Medicare services, including the capacity to check safety net
balances, organ donor registration details and children’s immunisation history, could be accessed
through the Internet 24 hours a day, seven days a week.
Better use of emerging technology has also allowed us to expand the Medicare services available
online to doctors. Almost 19 per cent of services were claimed online — up from 7.4 per cent last year.
Significant improvement has been made to our online claiming service for pharmacists. We are
expecting steady growth in 2006-07 with 500 pharmacists already indicating their interest in registering.
Program integrity
This year we delivered $17 billion in payments through Medicare and the Pharmaceutical Benefits
Scheme (up 5.7 per cent from the previous year) and over $26.5 billion in total benefit payments. While
the majority of health service providers and the public are honest, any percentage of fraud represents
an unacceptable loss to the Australian taxpayer.
We have a significant educational emphasis in place to support voluntary compliance. For the small
number of people who attempt to defraud their fellow Australians, we have strategies to detect,
investigate and refer for criminal prosecution.
This year we increased new investigation cases by 68 per cent and identified 5,288 cases (including
1,137 medical practitioners, 49 pharmacists/suppliers, and 297 members of the public) for potential
recovery action totalling $4.85 million and reviewed the practice profiles of over 500medical
practitioners.
Planning for the future
Medicare Australia is changing as the range of services we deliver continues to evolve. We will continue
to focus on delivering payments and information services to the public; however, our reputation and our
national network ensure we are well placed to broaden the range of services we deliver. We have seen
this with the roll out of Family Assistance and new functions such as Aged Care. We look forward to
continuing to play this role on behalf of government into the future.
To prepare ourselves to meet these challenges we started work in May on an important organisational
project that will consider our approach to managing change. While we can never be fully certain about
the challenges we are likely to face, we do know that the range of services we deliver are likely to
increase, and that some of our current services will be offered in different ways. We also know that to
continue our strong reputation for customer service, our staff will require training and support to meet
these challenges, and that extra demands will be placed on our infrastructure in our branches, contact
centres and in national office.
This work will continue into 2006-07 and will result in a business transition program for Medicare
Australia aimed at ensuring we are prepared to meet the new demands of government. The program
will also help us clearly define the future capabilities we need to continue to deliver great service, and
enable Medicare Australia to be adaptable and responsive to new priorities.
Catherine Argall PSM
Chief Executive Officer
Section 02
About Medicare Australia
Our organisation
Medicare Australia plays an integral role in the Australian health sector by administering a wide range
of health-related programs, including Medicare, the PBS, Family Assistance and the Australian Organ
Donor Register, on behalf of the Australian Government.
Medicare Australia processes more than 450 million transactions each year and is responsible for
paying over$26.5 billion worth of benefits to the Australian public and health care providers.
Medicare Australia is committed to providing great service to all Australians and to improving access
to health programs.
We maintain the highest privacy and security standards as well as a world class program that detects
and prevents fraud and inappropriate standards.
Our people shape our destiny. Planning and investing in building our capabilities is critical for our
organisation to grow and be recognised as a great service provider. Medicare Australia’s number one
priority is to deliver great service to all Australians, health professionals, private health bodies, state
and territory health bodies and other Australian Government departments and agencies.
As one of the largest and most efficient health benefit and information processing agencies in the world,
Medicare Australia has a connection with every Australian resident, doctor, pharmacist, and members
of the health sectors.
Our purpose
Our purpose remains as ‘working together to improve the health and well-being of Australians by
delivering information and payment services’.
To achieve our purpose, we work collaboratively with our Department of Human Service (DHS) partner
agencies, our external stakeholders, health services peak bodies and health practitioners.
The establishment of Medicare Australia
On 1 October 2005, the Human Services Legislation Amendment Act 2005 commenced. Along with
resultant amendments to other legislation, such as the HIC Act becoming the Medicare Australia Act
1973, the HIC became Medicare Australia.
As the HIC, we operated as a statutory authority under the CAC Act. We had our own governance
board, employment framework and a legal identity that was distinct from the Commonwealth.
As Medicare Australia we became a prescribed agency under the FMA Act, and a statutory agency
under the Public Service Act 1999.This essentially meant that we moved closer to government to
ensure that our daily operations delivered the outcomes that the government and people of Australia
expect.
The board of the HIC was dissolved and Medicare Australia’s CEO became directly responsible to the
Minister for Human Services, through the Secretary to the DHS, for ensuring the proper and effective
performance of Medicare Australia’s statutory functions which remained largely unchanged.
The change was achieved within six months of the Minister for Human Services’ announcement on 20
April 2005of the government’s decision, which was in response to the recommendations of the review
by John Unrigs AC into governance arrangements for statutory authorities and government business
enterprises. In the lead up to 1October 2005, the HIC worked in partnership with the DHS to effect the
change through:
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the introduction and passage of legislative amendments
the enhancement of financial systems to ensure MA Act compliance
a restructure of human resources systems to effect the transition to the Public Service Act 1999
corporate governance changes
the redesign of signage, our website and documents to reflect the name change to Medicare
Australia and
a communication program that had a particular focus on internal staff information and training.
A comprehensive consultation process took place with the DHS, the APS Commission, the Department
of Employment and Workplace Relations, and the Department of Finance and Administration with the
aim of minimising disruption to service delivery.
A project-management approach was adapted to work through the change with a project team
established to manage and coordinate the transition and assess its impact. The success of this
approach was highlighted by the fact that the change took place without negative impact on our service
delivery.
The Department of Human Services (DHS)
Overview
The Department of Human Services (part of the Finance and Administration portfolio) was established
on 26October 2004 to improve the development and delivery of Australian government social and
health-related services to the Australian people.
The department is responsible for ensuring the government is able to get the best value for money in
service delivery while emphasising continuous service improvement and a whole-of-government
approach.
The Minister
The Minister for Human Services in the forty-first Parliament is the Hon Joe Hockey MP, Member for
North Sydney since 1996.The Minister for Human Services is responsible for the administration of the
following legislation:
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Australian Hearing Services Act 1991, except to the extent that it is administered by the Minister for
Health and Ageing
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
Health Insurance Commission Act 1973 renamed Medicare Australia Act 1973 on 1 October 2005.
Human Services
Human Services comprises the following five entities:
1. The Department of Human Services (DHS), which consists of the core department, the Child Support
Agency (CSA) and CRS Australia.
The core department’s role is to direct, coordinate and broker improvements to service delivery through
the six Human Services agencies (the Child Support Agency, CRS Australia, Centrelink, Medicare
Australia, Australian Hearing and Health Services Australia).
The Child Support Agency’s role is to ensure that children of separated parents receive financial support
from both parents.
CRS Australia’s role is to assist people with an injury or a disability to get a job or return to work by
providing individualised vocational rehabilitation. CRS Australia also helps employers to keep their
workplaces safe.
2. Centrelink, which delivers a range of government payments and services for retirees, families, carers,
parents, people with disabilities, Indigenous people, and people from diverse cultural and linguistic
backgrounds and provides services at times of major change.
3. Medicare Australia, which administers a range of health and payment programs, including Medicare,
the PBS, Family Assistance Office services, the Australian Organ Donor Register, the Australian
Childhood Immunisation Register and Aged Care Payments to approved aged care providers.
4. Australian Hearing, which helps people manage their hearing impairment so they have a better
quality of life. Australian Hearing provides a full range of hearing services for children and young people
up to the age of 21, eligible adults and aged pensioners, and war veterans.
5. Health Services Australia, which is a government business enterprise established in 1997 focusing
primarily on providing occupational health, safety and medical assessments.
Structure of the Department of Human Services, 30 June 2006
Our role
Medicare Australia administers a range of health and payment programs on behalf of the Department
of Health and Ageing (DoHA), the Department of Veterans’ Affairs (DVA),the Department of Families
and Community Services and Indigenous Affairs (FaCSIA), and the Department of Health Western
Australia (DoHWA).
We manage claims processing and arrange for the payment of benefits for Medicare, which
incorporates Medicare Australia Special Assistance, Broadband for Health, Veteran Treatment
Accounts, the Visiting Medical Practitioner Program, the PBS and the Repatriation Pharmaceutical
Benefits Scheme (RPBS).
We are responsible for maintaining the Australian Organ Donor Register, the Australian Childhood
Immunisation Register and the National Bowel Cancer Screening Register.
There are a range of programs that relate to general practice that we manage including the General
Practice Immunisation Incentives Scheme, the Practice Incentives Program, the Rural Retention
Program, the General Practice Registrars’ Rural Incentive Payments Scheme and the Training for Rural
and Remote Procedural GPs Program.
In addition we look after the Compensation Recovery Program, the Hearing Services Program (for the
Office of Hearing Services) as well as facilitating Family Assistance payments in partnership with
Centrelink, the ATO and FaCSIA.
We also administer community rebate and reimbursement schemes such as the Higher Education
Contribution Scheme (HECS) Reimbursement Scheme and the government’s30% Rebate on Private
Health Insurance.
Further information about the role and performance of each of these programs can be found in Section
4 of this annual report.
Program integrity and assurance and promoting compliance
One of Medicare Australia’s major objectives is to ensure that the benefits that we pay on behalf of the
government are correct and that the health services supplied are appropriate.
Our program review function is responsible for preventing, detecting and investigating fraud and
inappropriate practice. It does this by balancing education and compliance strategies aimed at service
providers and members of the public who use Medicare Australia’s programs.
Information targeted at areas of known non-compliance is provided through face-to-face contact with
program users, a range of information sheets and feedback letters to medical practitioners and
pharmacists.
More general information designed to prevent fraud and inappropriate practice is provided through
Forum (a magazine for medical practitioners) and Bulletin Board (a magazine for pharmacists). These
quarterly publications, produced by Medicare Australia, are supported by other activities such as
regular advertising and information provided online at Medicare Australia’s website.
Further information about Medicare Australia’s program review role and performance can be found in
Section 4
Education and communication role
Medicare Australia has a range of communication tools to inform the public, customers and
stakeholders about our services and programs.
Medicare offices provide a key venue for communicating with the Australian public. This is achieved
through printed material such as posters, brochures and flyers, and information received from face-toface interaction with our customer services officers. Media liaison and paid media advertising are used
to communicate specific programs and services as the need arises.
In addition to Forum and Bulletin Board, which are designed to provide up-to-date information about
our health programs, Medicare Australia also produces Mediguide, a yearly publication that contains
detailed information for doctors about how to use Medicare Australia’s programs and services.
Direct mailing is also used to inform customers of changes to programs and services and the Internet
remains a vital communication tool for both providers and consumers who are being encouraged to do
more business with Medicare Australia online.
Our structure
In July 2005, our national office consisted of seven divisions, each headed by a general manager. A
restructure was undertaken in November 2005to align the business with meeting its future challenges
as an FMA Agency and to meet the Minister’s expectations.
Two deputy Chief Executive Officer (CEO) positions were filled and the five divisions remaining after
their structures were placed in two main groups: the Finance, Governance and Customer Service Group
and the Government Relations and Program Integrity Group.
In May 2006 a further alignment of the structure reintroduced a Program Management Division, giving
focus to the management of Medicare Australia’s major programs. As at 30 June 2006, a general
manager had not been appointed to the Program Management Division, thus the structures continue
operated as detailed below:
Financial Management Group — Craig Dalzell Chief Finance Officer
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Budgeting and financial analysis
Reporting
Financial systems
Policies and procedures
Treasury
Taxation
Property and office services
Security
Purchasing
Records management
The key outcomes for this financial year included introducing and advising on the governance changes
necessary for Medicare Australia to operate under the FMA Act, improving the budgeting and
forecasting systems to support the financial management improvements required, and finalising HIC
records.
Program Management Division and Government Relations and Program
Integrity Group
The Program Management Division and Government Relations and Program Integrity Group
comprised:
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Medicare and DVA Branch
Pharmaceutical Benefits Branch
Associate Government Programs Branch
Legal, Privacy and Information Services Branch and
Media, Communication and Government Relations Branch.
The group managed Medicare, the PBS and other health and allied programs administered by Medicare
Australia. The group monitored the performance of each program and developed administrative policy
for existing programs and proposed Australian Government initiatives. It provided communications
expertise covering all aspects of Medicare Australia business, as well as providing parliamentary
support to the organisation. The group supported the organisation through the provision of legal advice
on Medicare Australia programs, projects and human resource management issues. It also assisted
Medicare Australia to maintain best practice standards of privacy and to comply with relevant privacy
legislation. The group also collected, analysed and distributed statistical information relating to the
programs administered.
Customer Services Division —Ellen Dunne, General Manager
Customer Services Division was established in 2005 to support the core business of making payments
and collecting and providing information. Through the states, this division is Medicare Australia’s
gateway to the Australian public. Services and products delivered by the division support our customer
service officers in Medicare offices across Australia. The division provided mainframe and other
business system support, training and information tools. The state infrastructure that is part of the
division creates the operational structure and environment through which service delivery occurs.
The division also has two service and support branches in the national office: the Channel Support and
Development Branch and the Customer Service Support Branch.
Information Technology Services Division —Nic van den Berg, General
Manager
Information Technology Services Division provided and managed information technology services,
including system applications, and worked closely with all areas to maximise Medicare Australia’s
internal and outsourced information technology resources.
eBusiness and Development Division — David Trabinger, General
Manager
eBusiness and Development Division was established to strategically focus on improving the
effectiveness of service delivery through eBusiness and online services. The division had responsibility
for the development and delivery of Medicare Australia’s eBusiness initiatives.
Program Review Division (PRD) — Colin Bridge, General Manager
The PRD was established to protect the public purse from fraudulent or inappropriate claims. This
division worked to make the health care dollar go further by cooperating with medical professionals and
the health industry to help them to interpret the Medicare and PBS schedules correctly and thus claim
for their services appropriately.
Human Resources Branch— Carl Murphy, Manager
The HR Branch worked closely with the Executive and other key stakeholders to develop and
implement quality people management practices and initiatives. These enabled Medicare Australia to
deliver the outcomes expected by government.
Audit and Risk Assurance Services Branch —Chris Byrne, Manager
The Audit and Risk Assurance Services Branch (ARAS) provided independent and objective assurance
on the adequacy and effectiveness of Medicare Australia’s internal control framework. ARAS also
supported the Audit Committee’s review of Medicare Australia’s risk management and fraud control
activities and the implementation of audit recommendations by management.
Business Strategy and Development Branch —Mark Garrity, Manager
This branch was recently established to draw together the main business planning and business
development areas of Medicare Australia. Its main roles are the strategic review, identification and
development of new business opportunities for Medicare Australia (both in Australia and overseas) as
well as the organisation’s governance, strategic planning functions and the financial and organisational
modelling of new and current business. The branch will also provide assistance to Medicare Australia’s
Executive on issues relating to longer-term planning, change implementation and new business
opportunities.
State offices
To cater for Australia’s highly dispersed population; each state has a headquarters responsible for dayto-day operations, including the Medicare offices and contact centres.
During 2005–06, the state managers were:
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New South Wales — Ralph Watzlaff
Victoria — Greg Johnson
Queensland — Sue Harrop
Western Australia — Sandy Mamo
South Australia and Northern Territory — Peter Altree
Tasmania — Dr Peter Sexton.
Our senior executive top structure at 30 June 2006 appears on the following page.
Our relationship with other agencies
From 1 July 2005 to 30 September 2005 the HIC continued to focus on the delivery of services on
behalf of the DoHA, DVA and FaCSIA.
Since the organisation became a statutory agency, under the umbrella of DHS, Medicare Australia has
remained focused on the delivery of services to all Australians on behalf of its external stake holders.
The organisation consults with 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 customers.
Medicare Australia also embraced the opportunity to work closely with the DHS and its agencies to
seek synergies, where possible, and achieve the most cost effective outcomes.
All of our activities are conducted within the Australian Government policy framework set by legislation
and administered by the DoHA, DVA, and FaCSIA.
We actively contribute to policy development by providing information and feedback from our day-today operations.
Our funding arrangements
Medicare Australia reports to the Minister for Human Services within the Finance and Administration
Portfolio.
Medicare Australia is primarily funded by direct appropriation through the annual budget cycle.
Medicare Australia performs a number of services by agreement with other Commonwealth agencies
and is funded for these activities according to an agreed pricing arrangement.
Medicare Australia is also funded for services performed under contract with non-Commonwealth
Government entities including the Western Australian State Government and some services in
countries on the behalf of the World Bank.
Direct appropriation (health and ageing outputs)
Our relationship with DoHA is underpinned by a Service Level Agreement — the Strategic Partnership
Agreement — and by a funding agreement — the Output Pricing Agreement.
This arrangement will be superseded with a Memorandum of Understanding (MoU) currently being
developed between Medicare Australia and DoHA. The MoU will reflect the new working relationship
Medicare Australia has with DoHA, now we are no longer operating under the Health and Ageing
Portfolio.
Funding for health and ageing outputs, which represent a significant portion of Medicare Australia’s
operations, is by 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 to be paid to Medicare Australia under this arrangement
is estimated to be $569.9 million in 2006–07, which is slightly higher than the $524.6 million received
in2005–06. The estimate may change as a result of significant volume changes or new policy proposals
approved in the budget context.
DVA
Medicare Australia provides services to the DVA through the Service Level Agreement. The services
provided are for the processing of claims for veterans’ treatments, including medical, hospital and allied
health services. As with health and ageing outputs, the pricing structure for DVA services is based on
a variable price per processed service, with fixed revenue covering related infrastructure costs. The
estimated revenue to Medicare Australia under the Service Level Agreement for 2006–07 will be $16.0
million, which is slightly higher than the revenue received in 2005–06of $15.8 million.
FaCSIA
Medicare Australia provides Family Assistance services through the Medicare branch office network
on behalf of FaCSIA. Revenue associated with this program is an amalgam including a fixed amount
from FaCSIA, and a variable amount based on the level of processing undertaken by Medicare Australia
offices paid by Centrelink. The revenue Medicare Australia received for the provision of Family
Assistance services under this arrangement in 2005–06was $8.6 million. Funding for2006–07 is also
estimated at$8.6 million.
DoHWA
Through an agreement with the DoHWA, Medicare Australia has had a visiting medical practitioner feefor-service payment and information system in place since April2000. This system provides public nonteaching 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 2005–06 and 2006–07 is estimated at $1.2 million per annum.
Other sources of funding
In addition to service agreements, Medicare Australia also receives revenue through cost recovery
arrangements and the provision of services to agencies mentioned above and other external sources.
Medicare Australia received$18.6m in 2005–06 and is expected to receive $30.3m in revenue in 2006–
07 from DoHA. The bulk of this funding relates to the delivery of the aged care payments function on
behalf of DoHA which is covered under a Business Partnership Agreement. Medicare Australia also
provides additional Family Assistance services on behalf of Centrelink. Funding for2005–06 was $2.9m
and is estimated to be $13.1m in2006–07.
The chart below illustrates the main sources of funding for Medicare Australia in 2005–06.
The year in summary
Key achievements
The rollout of extended Family Assistance services delivered through Medicare offices commenced in
July 2005. At 30June 2006 extended services were available in 190 Medicare offices. The rollout is
scheduled for completion to all 238 offices by December 2006. Further information on Family
Assistance services can be found in Section 4 of this report.
In conjunction with the new Family Assistance services, Medicare Australia has implemented a new,
exciting and modern design for Medicare offices. The new design incorporates a range of exciting
features, including: electronic queue systems with comfortable seating arrangements for customer’s
waiting, sit-down customer service delivery, refreshed corporate branding, cross-agency promotional
capability and a self-service zone.
Customers in rural and remote communities in Northern Australia can now access Medicare Australia
information and support via selected Centrelink Customer Service Centres and agencies. Under this
initiative, complex enquiries are transferred to Medicare Australia’s 1800 Indigenous Access line by
Centrelink staff. Further information about our Indigenous Access Program can be found in Section 3.
Medicare Australia implemented new flexible business hours during July and September 2006. In all,
193 offices now offer extended business hours in our CBD’s, large metropolitan and regional locations.
This initiative builds on our move to Saturday business hours introduced in 114 locations across the
country in August 2004. Medicare Australia customers now enjoy greater choice in convenience when
accessing a Medicare office.
On 1 August 2005, Medicare Australia successfully implemented a new system to cater for Special
Patient Contributions. This initiative resulted from an agreement between the government and the
pharmaceutical industry that new generic medicines entering the PBS after 1 August 2005would be
listed at 12.5 percent below the current benchmark price.
On 20 October 2005, Medicare Australia assumed responsibility for the aged care payments function.
All transferring DoHA payments staff (approximately120 people) became Medicare Australia
employees.
Since October 2005, people have been able to view their Medicare Safety Net balance, their children’s
immunisation history statements and their organ donor details online. By 30 June 2006 consumers
could also view and update their Medicare card details, order a replacement or a duplicate Medicare
card and provide a preferred email address and banking details.
On 1 January 2006, Medicare Australia successfully implemented the new budget measure known as
the ‘PBS Safety Net 20 day rule’. This measure has resulted in specific medicines being excluded from
the PBS safety net entitlements where they have been dispensed within20 days of a previous supply
under the ‘immediate supply’ provisions.
Medicare Australia modified the Medicare claim form to give consumers the opportunity to register as
an organ donor when completing the form.
Through a combination of compliance activities, we have reinforced compliant behaviour amongst
service providers thereby ensuring that appropriate payments under the MBS and PBS are made.
Key business results at a glance
Medicare
Persons enrolled in Medic area
20.74 million
Active Medicare cards
11.6 million
Bulk billed services
177.2 million
Patient claimed services
70.2 million
Total services processed
247.4 million
Percentage of services bulk billed
71.6%
Total benefits paid
$10.9 billion
Medicare smartcard registrations
4,397
(a)
Includes some people who are not Australian residents (such as long-term visitors for more than six
months and eligible short-term visitors).The figure is the 2006 snap shot of the Medicare population
taken at 30 June 2006.
Note that the Statistical Table 20 of the Medicare component of the annual report also quotes a different
figure of 20,617,542 as the Medicare population. This figure refers to the number of people eligible for
Medicare benefits from 1 July 2004 to 30 June 2005.
Veterans’ Treatment Accounts (DVA)
STEC, PTEC and RPBC Cards produced
75,503
Provider cards produced
2,158
Services processed
21.5 million
Total benefits paid
$1.8 billion
Prior to the financial year 2004–05, 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 on the table above with those of the
earlier years, which used lines instead of services.
Service and benefit figures include incentive items.
PBS and RPBS (Payments to veterans processed by Medicare Australia on behalf of the DVA)
PBS services processed (including stoma)
168.2 million
RPBS services processed
15.2 million
Total services processed (including stoma)
183.3 million
PBS benefits paid
$5.8 billion
RPBS benefits paid
$469.7 million
Total benefits paid
$6.3 billion
Authority prescriptions authorised
6.7 million
Aged Care
Residential claims processed
23,691
Community aged care packages (CACP) claims
8,014
processed
Flexible care claims processed
1,186
Total claims processed
32,891
Total amount paid
$3.9 billion
Australian Organ Donor Register
Number of consent registrations (Including the 791,320
intent of 16-17 year olds)
Australian Childhood Immunisation Register
Valid immunisation episodes recorded
4.0 million
Children (under 7) registered
1.9 million
Total amount paid to immunisation providers
Children
registered
immunisation coverage
with
appropriate $8.3 million
aged 12–15 months
90.7%
aged 24–27 months
92.4%
aged 72–75 months
83.9%
General Practice Immunisation Incentive Scheme
Number of practices registered
5,491
Total payments*
$35.2 million
* Includes Service Incentive Payments and Outcomes payments
Practice Incentives Program
Participating practices
4,745
Total amount paid
$261.8 million
Rural Retention Program
Number of providers paid
2,021
Number of payments made
2,071
Total amount paid
$20.3 million
General Practice Registrars’ Rural Incentive Payments Scheme
Medical practitioners paid
426
Number of Payments made
786
Total amount paid
$6.7 million
Training for Rural and Remote Procedural GPs Program
Number of registered providers
1,323
Number of providers paid
767
Number of payments made
1,514
Total amount paid
$5.4 million
Compensation Recovery Program
Number of cases finalised
49,232
Total amount of benefits recovered
$31.3 million
HECS Reimbursement Scheme
Eligible medical graduates participating
421
Medical graduates paid
272
Number of payments made
440
Total amount paid
$2.1 million
Family Assistance
Total number of Medicare Offices offering full 190
service
Total number of customer accessing extended 129,025
Family Assistance services
Hearing Services Program
Services processed
898,483
Total amount paid
$203.1 million
Medical Indemnity — Incurred But Not Reported (IBNR) Claims
Claims received
375
Total number of claims paid
344
Total benefits paid
$14.8 million
Medical Indemnity — Premium Support Scheme (PSS)
Total members (doctors)
4,139
PSS subsidies paid to medical indemnity insurers $17.1 million
Medical Indemnity — UMP Support Payment
Number of members invoiced
10,131
Total amount invoiced
$13.7 million
Medical Indemnity — Competitive Payments received
Total number of invoices
1
Total amount paid
$56 million
30% Rebate on Private Health Insurance
Memberships registered
4.84 million
Total paid in cash claims
$2.14 million
Total paid to health funds
$3 billion
Medicare Australia Online Claiming
Increase in registered sites
2,133
Increase in registered sites transmitting via online 2,054
claiming
Bulk bill services submitted via online claiming
43.8 million
Patient claimed services submitted via online 2.9 million
claiming
Simplified Billing
Simplified billing services lodged via ECLIPSE*
70,926
Registered sites transmitting in-patient claims via
94
ECLIPSE
* Eclipse — Electronic Claim Lodgement and Information Processing Service Environment.
Challenges for the future
Medicare Australia will be working towards enhancing online services for all our customers by:



working with the DHS on the health and social services access card
providing online claiming functionality for aged care service providers and
Making it easier for Australians to do business with Medicare Australia.
Recommendations emanating from the Urbis Keys Young Market Research into improving Aboriginal
and Torres Strait Islander people’s access to Medicare Australia’s programs including Medicare and
PBS will be implemented.
Our information systems and telephony services will be consolidated in order to improve customer
service and to enable a single interface to future initiatives such as the health and social services
access card database.
A population health screening register will be developed to support the commencement of National
Bowel Cancer Screening Program invitations from August 2006 and to provide a high level of customer
service supporting the ongoing administrative role of the register.
One of the most significant human resource challenges Medicare Australia faces is identifying the
capabilities we will require in our future work force.
Intimately linked to this are the additional challenges of developing our existing staff helping them to
acquire those capabilities and recruiting new people who posses those skills. Given the ageing nature
of the Australian workforce and the increasingly tight labour market, well-targeted and high-quality
recruitment and development programs will be vital if Medicare Australia is to meet this challenge.
The implementation of initiatives under the Fourth Community Pharmacy Agreement will be continued.
This includes the delivery of an enhanced Residential Medication Management Review program that
will provide incentive payments to pharmacies and other business entities providing medication review
services in government-funded aged care facilities
Medicare Australia will continue to facilitate the increased uptake by pharmacists of online claiming for
PBS, as well as the implementation of other key eBusiness initiatives.
Section 03 Management and accountability
Corporate governance —before 1 October, 2005
HIC — Board of commissioners 1 July 2005 – 30September 2005 Up to 1 October 2005, the HIC
operated as a Commonwealth Statutory Authority under the CAC Act. This Act provided the general
governance, reporting and accountability framework for the organisation and imposed a regime for the
conduct of its officers.
The HIC Act stipulated that the HIC have a chair, a managing director and other members.
Commissioners were appointed by the Governor-General for up to five years with provision for
reappointment. The commissioners, including the chair, were appointed to part-time positions. The
managing director, who was a full-time appointee, was the commission’s only executive director and
managed the HIC’s operations as directed by the commissioners. With the creation of the DHS in
October 2004, the managing director was responsible to the board of commissioners and to the
Secretary of DHS for the management and operation of the HIC and reported through the Secretary of
DHS to the Minister for Human Services.
Commissioners were required to disclose any pecuniary interests that would conflict with matters being
considered by the commission in session. Meetings were presided over by the chair. Commission
decisions were by majority vote, with the chair having a casting vote. In the absence of the chair, the
commissioners present could vote to elect a person to preside at a commission meeting. The managing
director was not eligible for election.
From 1 July 2005 to 30September 2006 the board of commissioners was as follows:
Members of the Board of Commissioners to 30 September 2006
Peter Brunskill, B.Pharm, was appointed commissioner on 20 May 2004.
His term expired on 30 September 2005.
Peter D Bunting, LLB, FCA, FAICD, was appointed commissioner on 23 December 1997.
He was appointed as chair on 25 May 2000, and reappointed on 22 December 2002. His term expired
on 30 September 2005.
Robert J Collins, BSc, FAICD, FAIM, was appointed commissioner on 5 July 2000. His term expired
on 4 July 2005.
Sister Maria Cunningham, FCNA, MAICD, was appointed commissioner on 5 July 2000.
Her current term expired on 4 July 2005.
Jane Halton, BA (Hons), PSM, FAIM, was appointed commissioner on 18 January 2002.
Her term expired on 30 September 2005.
Eric Paul McClintock, BA, LLB, was appointed commissioner on 20 May 2004.
His term expired on 30 September 2005.
Bryce M Phillips, AO, MBBS, FAMA, was initially appointed commissioner on 28 August 1996 and
reappointed on 1 September 2001. His term expired on 30 September 2005.
Sally G Warneford, BSc (Hons) PhD, was appointed commissioner on 1 September 2001.
Her term expired on 30 September 2005.
Catherine Argall PSM was appointed managing director on 10 December 2004. Her term on the board
expired on 30 September 2005. From 1 October 2005, Ms Argall became the CEO of Medicare
Australia as part of the transition from HIC to Medicare Australia.
Board membership and meeting attendance
Commissioner
Appointment
date
Ms Catherine Argall
30 September 2005
3
2
Mr Peter Brunskill
30 September 2005
3
3
Mr Peter Bunting, chair
30 September 2005
3
2
Mr Robert Collins
4 July 2005
0
0
4 July 2005
0
0
Ms Jane Halton
30 September 2005
3
2
Mr Paul McClintock
30 September 2005
3
3
Dr Bryce Phillips
30 September 2005
3
3
Dr Sally Warneford
30 September 2005
3
2
Sister
Cunningham
Maria
expiry Meetings
attend
eligible
to
Meetings attended
Committees — HIC
Corporate Management Committee (CMC)
The CMC was the HIC’s main decision-making body and a key part of internal governance
arrangements. The CMC considered issues that had impact across the whole organisation and
provided advice and assistance to the managing director. Four subcommittees supported the CMC:

Customer Service

Finance

eBusiness and Technology and

People.
Audit Committee
The Audit Committee held its final meeting on 25 August 2005. The broad objectives of the committee
were to:

ensure the HIC met its strategic objectives

promote accountability to the Minister, the parliament and the community

support measures to improve management performance and internal controls

oversee the Audit and Risk Assurance Services Branch function and

Ensure effective liaison between senior management, internal auditand external audit functions.
Audit committee membership and meeting attendance 1 July – 30 September 2005
Member
Member eligible to attend
Meetings attended
Paul McClintock, chair
2
2
Peter Bunting
2
2
Corporate governance —after 1 October, 2005
With the commencement of the Human Services Legislation Amendment Act 2005, Medicare Australia
was established on 1 October 2005as a prescribed agency under the FMA Act and a statutory agency
under the Public Service Act 1999.
The CEO of Medicare Australia reports to the Minister for Human Services through the Secretary of
DHS. Section8AB of the Medicare Australia Act 1973 states that the CEO is, under the Minister,
responsible for:



deciding the objectives, strategies, policies and priorities of Medicare Australia
managing Medicare Australia and
ensuring that Medicare Australia performs its functions in a proper, efficient and effective manner.
In doing so the CEO is supported and advised by an executive management team, consisting of two
deputy CEOs, six general managers and six state managers.
In line with the recommendations of the Uhrig report which sought to improve corporate governance
and accountability arrangements, the Minister for Human Services issued the CEO of Medicare
Australia with a Statement of Expectations for the period 1 October 2005to 30 September 2006. The
statement sets out the Minister’s priorities and includes key deliverables around our strategic themes
of service delivery (for payments and information) and program integrity.
The CEO formally responded to the Minister with a Statement of Intent outlining Medicare Australia’s
key commitments in meeting the Minister’s expectations. Both these documents are available to the
public to view through the Medicare Australia website.
Directors’ and officers’ liability insurance
Directors’ and officers’ liability insurance is an element of Medicare Australia’s Insured Schedule of
Cover. The class of insurance provides related liability protection to a limit as noted on the Schedule of
Cover. A separate Schedule of Cover is in place for the former Commissioners of HIC.
Internal governance arrangements —Medicare Australia
Refinement of internal governance arrangements was undertaken in August 2005, to ensure that they
were robust and met the requirements of the FMA Act. Arrangements were put in place to establish an
Audit Committee with an independent chair early October 2005. The Audit Committee met for the first
time on 15 December 2005.In recognition of the importance of program integrity issues in Medicare
Australia, a separate Program Integrity Committee was also established with two independent
members. Both of these committees report directly to the CEO.
Formal reporting arrangements with the Secretary of DHS were established in October 2005. The CEO
and other key members of the executive management team meet with the Secretary DHS and other
key DHS staff on a monthly basis to formally report on progress with regard to priority activities.
CMC — Medicare Australia
In preparation for the transition to Medicare Australia, the role, membership and purpose of the CMC
was reviewed. The CMC is the primary management committee within Medicare Australia. It provides
strategic advice to the CEO. Its objectives are to assist the CEO in discharging his or her obligations in
ensuring that Medicare Australia:




has appropriate governance frameworks in place
conforms with all legislative requirements
operates effectively to deliver the government’s service delivery objectives and
is strategically positioned to meet future requirements.
Five subcommittees support the CMC:





Customer Service
Finance
eBusiness and Technology
People and
Security.
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 CEOs instructions, finance policies, human resource
management policies and audit policies/charters.
Transition to the FMA Act
A challenge for the organisation in 2005–06 was the transition from being a statutory authority under
the CAC Act to an FMA agency. Considerable effort went into ensuring a smooth transition from an
external governance board and audit committee to an executive management governance model under
the FMA Act. Critical to this was the establishment of the Audit Committee which provides
independent assurance and assistance to the CEO (and the CMC) in relation to Medicare Australia’s
risk, control and compliance framework, and its external accountability obligations.
Medicare Australia continues to strengthen its financial management framework to improve the
management of resources and ensure it discharges its governance and accountability obligations under
the FMA Act.
Delegations (post 1 October 2005)
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 FMA Act and the Public Service Act 1999. In addition, delegations are also made under the
Medicare Australia Act 1973 and other relevant health legislation including, but not limited to:






Health Insurance Act 1973 (HIA)
National Health Act 1953 (NHA)
Health and other Services(Compensation) Act 1995(HOSC Act)
Private Health Insurance Incentives Act 1998
Medical Indemnity Act 2002 and
Aged Care Act 1997.
Instruments of delegation specific to Medicare Australia officers have been made by the CEO 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 Secretaryto DoHA.
Committees —Medicare Australia
Audit Committee
The Medicare Australia Audit Committee held its inaugural meeting on 15 December 2005.The Audit
Committee provides independent assurance and assistance to the CEO in relation to Medicare
Australia’s risk, control and compliance framework as well as its external accountability obligations. In
particular, the Committee oversees:




the effectiveness of Medicare Australia’s internal control framework
the internal audit program which reviews the adequacy and effectiveness of Medicare Australia
operations
Medicare Australia’s corporate risk management and planning activities and
The manner in which Medicare Australia complies with its external accountabilities and obligations,
including the preparation of its annual financial statements.
The committee comprises five members: two external members, Mr Bruce Jones and Ms Meryl Stanton,
Medicare Australia’s Deputy CEO, Corporate and Strategy, one state manager and one branch
manager. Mr Jones chairs the committee.
The Audit Committee meets at least six times a year. For the period 1 October 2005 to 30 June 2006
the committee met four times.
Since commencement, the committee has:



developed the Audit Committee Charter — during the process of which consideration was given to
the Australian National Audit Office Better Practice Guidelines on Public Sector Audit Committees
2005
developed an Audit Committee annual work plan and
Placed a greater emphasis on monitoring the implementation of internal and external audit
recommendations.
Representatives from the Australian National Audit Office and DHS are invited to attend Medicare
Australia’s Audit Committee meetings.
Financial framework
The transition to becoming a statutory agency necessitated an overhaul of Medicare Australia’s
financial framework during the financial year. Anew set of Chief Executive Instructions were developed,
all financial and personnel delegations were reviewed and revised, supporting procedural statements
were revised, and organisation-wide training in tasks relating to financial activities were implemented.
Financial performance is regularly reviewed both within Medicare Australia, and by the DHS and the
Department of Finance and Administration. Internal to Medicare Australia, budget and resourcing
decisions are considered by the Finance Subcommittee that reports to the Corporate Management
Committee. During 2005–06Medicare Australia continued to implement a budget management system
and further refine activity-based management systems, facilitate transparency indecision-making
processes and disseminate information relating to funding sources within the organisation. These
systems also support enhanced business modelling and costing capability.
Program integrity assurance
Medicare Australia is responsible for payments for Medicare services and supplies of PBS medicines
to the Australian population and overseas visitors (from countries that have reciprocal health
agreements with Australia).
To ensure the integrity of Medicare and PBS payments, Medicare Australia implemented a compliance
program ensuring that Medicare services are provided and PBS scripts are supplied properly. In2005–
06, the Program Review
Division (PRD) administered this compliance program. Unlike other social security or labour market
programs, Medicare and PBS related payments are made by Medicare Australia to medical
practitioners, patients and pharmacists for services rendered. Therefore, in this unique environment,
there are four possible groups that can independently, or in combination, pose potential risks to the
integrity of the MBS and PBS schemes:




medical practitioners —these are mainly doctors who are eligible to provide medical services
through Medicare, and to prescribe medicines under the PBS
pharmacists and suppliers— these are mainly pharmacists who are eligible to supply medicines
under the PBS; this group also includes public hospitals, run by the state and territory governments,
which supply PBS medicines
patients and consumers —these are mainly Australian residents and overseas visitors who require
medical treatments under Medicare or use PBS listed medicines and
Members of the public —these also include medical office staff.
In 2005–06, PRD undertook a number of compliance activities to detect, prevent, and correct
inappropriate and fraudulent practices, by the four groups above, as part of a broader effort to ensure
payments of benefits are correctly made for services properly rendered or supplied. Further details of
PRD’s activities can be found in Section 4.
External and internal scrutiny
External scrutiny
The Audit and Risk Assurance Services Branch (ARAS)is responsible for liaison between the Australian
National Audit Office (ANAO)and HIC/Medicare Australia and for providing coordinated responses to
draft audit findings and recommendations. Details of ANAO reports affecting HIC/Medicare Australia
are provided below.
ANAO
During 2005–06, the ANAO tabled in parliament a number of reports on audits involving HIC/Medicare
Australia. These reports consisted of:

cross-agency audits where HIC/Medicare Australia was involved


an audit of another agency that involved consultation with HIC/ Medicare Australia and
Other audits where HIC/ Medicare Australia was not directly involved but where recommendations
were targeted at all agencies.
Cross-agency audits where HIC/Medicare Australia was involved

Audit Report No. 21 2005–2006
Audit of Financial Statements of Australian Government Entities for the Period Ended 30 June
2005(tabled 21 December 2005)

Audit Report No. 22 2005–2006
Cross Portfolio Audit of Green Office Procurement (tabled 22 December 2005)

Audit Report No. 26 2005–2006
Forms for Individual Service Delivery (tabled 25 January 2006)

Audit Report No. 42 2005–2006
Administration of the 30Per Cent Private Health Insurance Rebate Follow-up Audit (tabled 25 May
2006)

Audit Report No. 45 2005–2006
Internet Security in Australian Government Agencies (tabled 13 June 2006)
An audit of another agency that involved consultation with HIC/Medicare Australia
 Audit Report No. 44 2005–2006
 Selected Measures for Managing Subsidised Drug Use in the Pharmaceutical Benefits Scheme
(tabled 1 June 2006)
Other audits where HIC/ Medicare Australia was not directly involved but where
recommendations were relevant to all agencies

Audit Report No. 11 2005–2006
The Senate Order for Departmental and Agency Contacts (Calendar Year2004 Compliance) (tabled29
September 2005)

Audit Report No. 16 2005–2006
The Management and Processing of Leave (tabled 17 November 2005)

Audit Report No. 23 2005–2006
IT Security Management (tabled 22 December 2005)

Audit Report No. 27 2005–2006
Reporting of Expenditure on Consultants (tabled 30 January 2006)

Audit Report No. 28 2005–2006
Management of Net Appropriation Agreements (tabled 31 January 2006)
-- Audit Report No. 37 2005–2006
The Management of Infrastructure, Plant and Equipment Assets (tabled 3 May 2006)
Audits in progress
An ANAO performance audit of FTB debt involving Medicare Australia was in progress at 30 June 2006.
This is across-agency audit and will examine the effectiveness and efficiency of the Family Assistance
procedures to manage customer debt within the FTB program. Medicare Australia provides limited
Family Assistance services through its Medicare offices. The ANAO expects to table this report in
December 2006.
Medicare Australia’s Audit Committee maintains scrutiny over the implementation of ANAO
recommendations where they are applicable to Medicare Australia.
Internal scrutiny
The 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
and
Providing advice and assistance on risk management and fraud control, including the development
of policies and procedures and the Corporate Risk Management and Corporate Fraud Control
Plans.
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.
The 2005–06 annual audit work program was developed following consultation with senior
management and was based on:






current assessment of risks and effectiveness of risk management and control processes
current issues relating to governance, particularly the transition to an FMA Act agency
major changes in business, operations, programs, systems and controls
opportunities to achieve operating benefits
dates and results of previous audits and
Requests by the Audit Committee or the Executive.
Other major activities include:


monitoring the progress on 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 via the intranet and risk management advisers are available to facilitate risk management
education, workshops and report preparation.
ARAS is responsible for preparing and facilitating the monitoring by the Executive of the Corporate Risk
Management Plan. The corporate and lower level plans are subject to quarterly review and updates to
ensure the momentum for implementing control activities is maintained and potential or emerging risks
are identified and monitored.
Our framework is consistently reviewed and revised, and work has commenced to amalgamate the
business planning and risk management templates. Thus both the business planning and risk
management business units will be able to promote embedding risk awareness indecision making at
all levels of business planning and program management processes.
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 2006 our organisation achieved a score of eight in the Com cover Risk Management
Benchmarking Survey. Our achievement entitled us to an 8 per cent discount on our Com cover
insurance premium.
Fraud control
Medicare Australia’s fraud prevention and control activities range from education to control, planning,
detection and investigation. Our learning and development team is currently reviewing and revising our
fraud awareness training package.
Medicare Australia completed its 2006 – 08 Fraud Control Plan during the year. A thorough fraud risk
assessment across the organisation was undertaken and the Fraud Control Plan prepared to reflect
that assessment. The plan is based on the results of fraud risk assessment and interviews with senior
management and staff. The plan conforms to the Commonwealth Fraud Control Guidelines
2002produced by the Attorney-General’s Department and is available via the intranet. It complements
Chief Executive Instruction 7.2 on fraud prevention and control.
Balanced scorecard
The review of the balanced scorecard was suspended during the transition to Medicare Australia and
recommenced in December 2005.
Medicare Australia has since developed an extensive list of key performance indicators that allow the
organisation to monitor a wide range of financial and non-financial functions against internal targets
and benchmarks. These measures are categorised under six perspectives:






Finance
Service (Public and Government)
Internal Processes
Development and Growth
People and
Social and Environmental
The process of redeveloping the balanced scorecard involved defining key performance indicators and
setting targets across the organisation in consultation with relevant work areas involved in the key
business processes. These measures will be further reviewed and refined to deliver a high level
overview of the organisation’s performance under the six perspectives.
A summary of some of these measures is reported below:
Medicare
Actual
Australia balanced
2003-04
scorecard
Actual
Actual
Actual
2004-05
2005-06
2005-06
Financial
management
Revenue
$537.5m
$596.1m
$578.m
$577.6m
Operating
expense
$531.8m
$593.0m
$585.4m
$584.5m
Net profit
$5.7m
$3.1m
$(6.7)m
$(6.8)m
Community
satisfaction
93%
90%
91%
93%
Medical
practitioner
satisfaction
79%
85%
70%
71%
Practice manager
90%
satisfaction
90%
85%
86%
Pharmacist
satisfaction
85%
90%
92%
Call
centre
91%
response time
93%
90%
91.46%
Percentage
of
Medicare
89%
payments within
time commitments
Refer
Refer
90%
Appendix E
Appendix E
Claim processing
98%
accuracy
98%
99%
97.8%
9.93%
23.05%
24.69%
Stakeholder
91%
Internal business processes
Growth and development
Online
claiming
take-up
— 3.24%
Medicare Bulk Bill
Online
claiming
take-up
—
0.65%
Medicare Patient
Claim
1.8%
4.35%
5.12%
62%
≥71%
71%
87%
85%
86%
6077
≤10,000
3,905 kwh
Social
Overall
satisfaction
staff
73%
Customer
satisfaction with
range of options n/a
available to claim
a Medicare refund
Environmental
Energy usage per
6200
employee (MJ)
Corporate business continuity
Business disruption could damage Medicare Australia’s reputation if the speed or scale of an
emergency were to overwhelm our operations and management systems. Medicare Australia uses
business continuity principles to ensure we are prepared to control emergencies when they occur. As
part of this preparation, our divisions and state offices maintain business continuity plans to ensure
effective interim operating arrangements can be put in place to support critical business processes and
resources. Medicare Australia regularly tests its business continuity plans and also incorporates
experience gained from real emergencies such as Cyclone Larry to ensure our business continuity
plans are effective.
Medicare Australia has been preparing business continuity plans that will cater for events of varying
severity, from local issues to wide spread pandemic issues. This planning involves focus on two areas:
customers and personnel. For customers, Medicare Australia will categorise business processes and
identify policies to be used during an event. For personnel, Medicare Australia is developing policies
and procedures to be used during an event. Medicare Australia plans to publish these frameworks in a
simple, readable format so that they can be used in operational areas with a minimum of effort.
Our stakeholders
Stakeholder satisfaction
Satisfaction research has been undertaken by Medicare Australia annually for consumers (since 1984)
and medical professionals (since 1991). The research results and recommendations have been used
over the years to inform Medicare Australia in terms of priorities, service delivery and channel
management.
In 2006, satisfaction research surveys were conducted with the community, practitioners (general
practitioners, pathologists, imaging specialists, other specialists, optometrists and ancillary
immunisation providers), practice managers, pharmacists and aged care providers. As part of the
research, feedback was specifically obtained on how Medicare Australia is performing against its
service charter promises.
Aged care provider satisfaction surveys were conducted for the first time in 2005–06 due to the
transition of aged care services to Medicare Australia. The result of 97 per cent satisfaction in 2005–
06 establishes our benchmark for future years.
The apparent fall in practitioner satisfaction is the result of an increase of 13 per cent in ‘don’t know’
responses from doctors and is due to the growing role of practice managers in dealing with Medicare
Australia. When ‘don’t know’ responses are removed, practitioner satisfaction levels are the same as
2004-05.
Overall
performance
indicators
key
2004-05 actual
2005-06 target
2005-06 actual
Community satisfaction
90%
with Medicare
≥ 91%
96%
Practitioner satisfaction
85%
≥ 70%
71%
Practice
satisfaction
90%
≥ 85%
86%
85%
≥ 90%
92%
manager
Pharmacist satisfaction
Stake holder consultation
Stake holder Consultative Group
In May 2006 Medicare Australia amalgamated its three key stakeholder groups: the Stakeholder
Advisory Committee, the Doctors’ Communication Group, and the Pharmacists Communication Group,
into one overarching group, known as the Stakeholder Consultative Group. The amalgamation will
provide a better opportunity for key stakeholders to discuss and influence Medicare Australia’s business
activities at a strategic level. The group will meet 2–3times a year.
During 2005–06 the Stakeholder Advisory Committee met in July2005 and May 2006.
Consumer Communication Group
Medicare Australia has an established consumer stakeholder group — the Consumer Communication
Group — that meets 2–3 times a year. Members provide input on issues, discuss the potential impact
to services and products, and provide advice on how Medicare Australia can add further value in the
delivery of services to the Australian public.
Representatives from various organisations and community groups attend the Consumer
Communication Group, such as: Health Consumers Rural and Remote Australia, Chronic Illness
Australia, Carers Australia and Australian Federation of Disability Organisations.
Service charter
Our promises to you
We completed a review to align Medicare Australia’s service charter with best practice principles. We
improved the charter’s promises and format, and repositioned it as an internal driver for customer
service delivery. Extensive consultation took place with internal and external stakeholders.
The revised service charter has four statements that are based on what the Australian public and
stakeholders have been telling us — the service experience that they really want from Medicare
Australia:
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‘Make it easy for me’
‘Get it right’
‘Be genuinely interested in me’ and
‘Respect my rights’.
Medicare Australia is committed to delivering great service to all Australians. To ensure that we deliver
against these statements, the service charter also:
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makes specific promises in relation to each statement, outlining specific service standards
provides measures —such as key performance indicators (KPIs) — that show how well we are
doing on each promise
incorporates staff behaviours and values that support the delivery of the service charter promises
in daily work practices and
Links the customer service focus directly to each individual performance agreement.
Medicare Australia will measure each of our promises and publish the measures and outcomes on our
website.
You said….
We will….

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“Make it easy for me”

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“Get it right”

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“Be genuinely interested in me”

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“Respect my rights”

Key behaviours

Improve convenience and
access for all Australians by
providing a range of service
options, including online
Stay open longer in our
busiest branches
Keep queue times in
Medicare offices to a
minimum
Answer the phone quickly
Increase awareness of our
services
amongst
Indigenous Australians
Help you access other
agencies in the Department
of Human Services
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Teamwork (find solutions not
problems and work within
and across teams and with
the public to get the right
result)
Initiative (be proactive, look
for improvements; follow
through)
Ownership
(take
responsibility for resolving
issues)
Empathy (be friendly, open
and honest; put yourself in
the public’s shoes)
Communication (keep it
simple and clear)
Keep our promises (do what
you say you will)
Make accurate and timely
payments
Give you clear and accurate
information
Give you consistent advice
Provide service with a smile
Listen to your feedback and
be responsive to your needs
Respond to your complaints
promptly
Treat you with respect and
Courtesy
Respect the privacy and
confidentiality
of
your
personal information
Respect your rights to seek
a review of our decisions
Refer to Appendix E for a complete report of measures against the service charter.
Feedback
Improvements have been made to the way we record and report on feedback from the Australian public.
We have established a dedicated complaints and feedback number – 1800 465 717 – to assist
Medicare Australia to fulfil the service charter promises. The public can also provide feedback online
or through customer service officers in Medicare offices. We have also established customer service
managers in each state to analyse complaints and to ensure problems are resolved and feedback is
reflected in business practices. All complaints are now categorised according to the service charter
promises to assist analysis and identify trends.
International Customer Service Standard
Medicare Australia is the first government agency to achieve certification against the International
Customer Service Standard (ICSS) awarded by the Customer Service Institute of Australia (CSIA). Our
initial certification occurred in 2004and we have been awarded with recertification in 2005 with an
improved rating.
The ICSS applies to private enterprise, government and not-for-profit businesses. As the name
suggests, it is an internationally recognised standard.
Recertification is an acknowledgment of Medicare Australia’s achievements and improvements during
the past 12 months. It provides us with recognition of our service excellence.
National Service Excellence Awards
Medicare Australia’s service excellence was recognised by the CSIA this year with a national service
excellence award in the Government Contact Centre category. The CSIA also gave state awards to
three of our contact centres in Victoria, Queensland and Western Australia. Medicare Australia was
judged on arrange of criteria including management and leadership, innovation and improvement, and
responsiveness. Winning these awards recognises our service improvement effort and illustrates our
commitment to customer service excellence.
Local Liaison Officer (LLO) Initiative
Throughout 2005–06 the LLO program has continued to provide a channel through which Members of
Parliament and Senators can receive advice in response to constituent concerns raised in relation to
any DHS agency. The program aims to make Medicare Australia and all DHS agencies more
responsive to information requests and complaints that come directly through Ministers, other members
of Parliament, Senators and their staff.
Medicare Australia currently has 16 LLOs supporting16 of the 150 Members of Parliament, and 17
LLOs supporting 22 of the 76senators. The remaining Members of Parliament and Senators are
supported by LLOs from other DHS agencies. To ensure all LLO referrals are acknowledged within 48
hours, a network of back-up LLO staff and contact officers has also been established.
In 2005–06 a total of 4,580LLO referrals were received throughout DHS, with 83(1.8 per cent) relating
to Medicare Australia.
People with disabilities
During 2005–06 Medicare Australia continued to respond to the Commonwealth Disability Strategy with
arrange of activities guided by the principles of equity, inclusion, participation and access and
accountability. Information about Medicare Australia programs is available in Braille, large-print and
audio formats — these information kits are available from Medicare offices and Medicare Australia
contact centres. The large-print information is also available from the Medicare Australia website.
Medicare Australia provides access to the Telephone Typewriter Service and the National Relay
Service for people with hearing or speech impairments.
Physical access issues are being addressed as Medicare offices are refurbished with the installation of
automatic doors, sit-down counters and sloped writing surfaces for public use.
The new design incorporates combination of modular and standard seating arrangements designed to
suit different people’s requirements. This seating, along with the introduction of electronic queue ticket
systems in our busiest offices, provides customers with the convenience of comfortable sit-down
customer waiting.
Some Medicare offices have counter hearing systems to provide better access to services for people
with hearing disabilities.
Cross-agency initiatives
Medicare Australia undertook several cross-agency initiatives with other DHS agencies during 2005–
06. These included:
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
Family Assistance 2005;
Local Liaison Officer Program Feb 2005
DHS Agency collaboration meetings on Absenteeism and Training — 2005
Indigenous Message Stick — Centrelink to Medicare Australia — 2006.
The Melbourne 2006Commonwealth Games
The Federal Government committed $294m in funding to support the Melbourne2006 Commonwealth
Games. This was primarily to support the Queen’s Baton Relay, Elite Athletes with a Disability and the
Opening and Closing Ceremonies. As a result, the DHS Melbourne 2006 Commonwealth Games
Strategy was officially launched on 19 October 2005 by Minister Hockey at the Melbourne Cricket
Ground.
In Victoria, we worked behind the scenes to ensure that we utilised this major event to strengthen our
relationship with the community and also our sister agencies within DHS.
Cross-agency committees’ were formed and highlights included:

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
Queen’s Baton Relay — promoted community engagement as Medicare office staff nationwide
supported local activities in towns where the baton passed through
job expos — Medicare office staff participated in the eight expos held across metropolitan and
regional Victoria by answering queries regarding access to our services and promoting the
Australian Organ Donor Register (AODR)
Adopt a Second Nation — this local government initiative was supported throughout Victoria by
offices supporting various competing nations with displays relating to that nation and
DHS online demonstration site — Medicare Australia was represented at the site for the duration of
the Games with a display stand showcasing our brochures and services.
Special assistance hotlines
During 2006, in addition to the Bali med Line and Bali2005, the customer service department added
Tsunami Assist, London Assist and Egypt Bombing Healthcare Costs Assistance to their hotlines to
assist Australians impacted directly by these events. The services included registering eligible people,
processing claims (out-of-pocket expenses),telephone enquiries and general liaison with patients and
health care providers.
Indigenous people
What we know about Australia’s Indigenous population
The Australian Bureau of Statistics’ latest (2001) data reveals that Indigenous people make up 2.2 per
cent of Australia’s population, which equates to around 410,000people. Most Indigenous people live in
New South Wales and Queensland, followed by Western Australia and the Northern Territory. The
Australian Capital Territory has the smallest population of Indigenous people, with around3,500 people.
Indigenous Access Program
Medicare Australia’s Indigenous Access Program (IAP) was established in 2000 to improve Aboriginal
and Torres Strait Islander people’s access to Medicare Australia programs. The IAP supports health
service providers and Aboriginal and Torres Strait Islander people to fully utilise these programs, and
ultimately to improve their health outcomes.
Key roles and responsibilities
The IAP is led by a team within the national office and is responsible for setting the strategic direction
for the development of initiatives and policies relating to Indigenous service delivery. This includes the
management and coordination of key activities of the national network of Medicare liaison officers for
Indigenous Access.
Medicare liaison officers operate out of each of the states and territories, and have a diverse range of
culturally appropriate skills and expertise. They work closely with Aboriginal and Torres Strait Islander
Medical Services and other health service providers nationally to promote and support the use of
Medicare Australia programs.
The network enables improved access to and enrolment in Medicare Australia services. It increases
the provision of systematic and dedicated support and outreach services to Aboriginal and Torres Strait
Islander people and their communities across the rural and remote areas of Australia. The key
responsibilities of the Medicare liaison officers are to:




provide Medicare education and training to Aboriginal and Torres Strait Islander Health Service
(ATSIHS) staff to increase enrolments in Medicare and to ensure correct Medicare benefits are
claimed, resulting in increased Medicare revenue for ATSIHS
provide support and expert advice to health service staff and providers when new Medicare
initiatives are released
undertake field trips and visits to health services, local communities, prisons and schools to address
issues and
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
Aboriginal and Torres Strait Islander customers with enquiries. The Aboriginal and Torres Strait Islander
Access line — 1800 556 955— receives approximately 4,000 calls per month and is supported by
Medicare liaison officers in each of our state headquarters.
Stakeholder engagement activities
Medicare Australia is represented on the Cross Agency Indigenous Servicing Taskforce, formed to
enhance collaboration between DHS agencies in order to improve service delivery to Aboriginal and
Torres Strait Islanders. Since its inception, the taskforce has overseen the implementation of a range
of DHS partnering initiatives, which have extended access to Medicare services.
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 that
have been agreed between Medicare Australia and DoHA’s Office of Aboriginal and Torres Strait
Islander Health (OATSIH), including the funding for additional Medicare liaison officers for Indigenous
Access, and other strategic initiatives.
Medicare Australia and Centrelink have agreed to the provision of basic Medicare services via the
Centrelink Remote Area Service Centre network and some small customer service centres and agent
sites throughout Northern Australia.
Services offered from these sites include:

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
Medicare enrolments
updating customer contact details
manual collection of Medicare claims
ordering new or replacement Medicare cards and
General enquiries.
Customers in Northern Australia can now access Medicare Australia information and support via the
Centrelink Indigenous Call Centre network. Under this initiative, customer calls are transferred directly
to Medicare Australia’s Aboriginal and Torres Strait Islander Access line by Centrelink staff.
Joint field trips are scheduled and undertaken by DHS agencies where appropriate. The field trips
increase the breadth of community access, and foster networking between agencies and communities.
Medicare Australia also continues to work with health authorities, medical practitioners and
communities to improve the accuracy of immunisation data for Indigenous children.
Key activities
Key activities of the Aboriginal and Torres Strait Islander Access Program include:

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

the undertaking of are search project that has been jointly commissioned by Medicare Australia and
OATSIH to further improve access to medical services by Indigenous Australians — the focus of
this research is to assess the effectiveness of major health programs in supporting Indigenous
access to and utilisation of health services and build on the improvements made as a result of
previous research conducted in 1997
the development of a Voluntary Indigenous Identifier Communication and Education Strategy to
improve the management of information about Indigenous people and allow better health policy and
initiatives to be developed
offering basic Medicare services from 49 Centrelink sites, with further sites identified and
continued provision and support of the 1800 free call Aboriginal and Torres Strait Islander Access
line.
Collection of health service information
Medicare Australia collects information on medical practitioners providing services at ATSIHS
registered under section 19(2) of the HIA.
The Minister for Health and Ageing, the Hon Tony Abbott MP, has directed (in accordance with existing
section 19(2) orders) that Medicare benefits be paid to these health services. Medicare benefits are not
payable where a health service is funded from another source, unless the Minister so directs.
The information collected by Medicare Australia enables the identification of Medicare payments
provided to these health services, and subsequently used to improve Indigenous health.
Cultural diversity
In line with the Charter of Public Service in a Culturally Diverse Society endorsed by the Council of
Australian Governments, Medicare Australia offers a number of services and activities to assist people
from culturally and linguistically diverse backgrounds. For example:




translated information about Medicare and other programs that we administer is available in 18
community languages — these information kits are available from Medicare offices, call centres and
our website
Medicare Australia receives eligibility information relating to migrants and applicants for permanent
residency electronically from the Department of Immigration and Multicultural Affairs (DIMA) — this
data transfer helps to streamline enrolment processing of new arrivals
customers can access more than 100 languages through the telephone interpreter service and
speak to a qualified interpreter over the telephone, or at a face-to-face interview and
Many Medicare Australia employees are bilingual and wherever possible use their language skills
to make communication easier and more effective.
Staff matters
As part of the transition to Medicare Australia in October2005, staff came under the provisions of the
Public Service Act 1999. The Department of Employment and Workplace Relations and the APS
Commission provided advice and support in managing the human resource implications of the change.
Important elements of this were the negotiation of a new certified agreement (that came into effect in
December 2005) consistent with the requirements of the APS, and a review of Australian Workplace
Agreements. There was also a comprehensive education program for managers and employees on
how the move would affect them, particularly in the areas of recruitment, transfers across the APS, and
reviews of action. A major initiative was also launched to educate staff about APS Values and the Code
of Conduct, given that prior to joining the APS; Medicare Australia had its own values and code. That
education campaign continues.
Given its national presence and responsibilities, Medicare Australia has sought to position itself as an
employer of choice across Australia. Fundamental to this is fostering a culture that emphasises
teamwork and values its people. Medicare Australia has worked hard to develop and retain a friendly
atmosphere where job satisfaction is high. Given the increasingly tight labour market, if Medicare
Australia is going to attract and retain enthusiastic and capable people, it is vital that it remains a great
place to work.
Perhaps the most significant challenge to face is identifying the capabilities we will require in our future
workforce.
Intimately linked to this are the additional challenges of developing our existing staffs, helping them to
acquire those capabilities,while also recruiting new people. With the ageing of the Australian workforce
and the tight labour market, well-targeted and high quality recruitment and development programs are
crucial for Medicare Australia.
Ethical standards and code of conduct
The Code of Conduct that was contained in the HIC Corporate Governance Charter set out the
principles that guided the former commissioners in adopting the highest ethical and professional
standards when carrying out their governance roles. All employees of the HIC were required to sign the
Code of Conduct, which included specific reference to the secrecy provisions in the HIA and the NHA
1953.
On 1 October 2005, the CEO signed instruments of delegation in respect to the Medicare Australia Act
1973, the FMA Act, and the Public Service Act 1999. These instruments applied to all ongoing
employees of Medicare Australia as at 1 October 2005.
Since 1 October 2005, all new employees of Medicare Australia are required to sign undertakings and
acknowledgements recognising their obligations in relation to:



access to information acquired in the course of official duties, including the secrecy provisions of
section 130 of the HIA and section 135A of the NHA
the APS Code of Conduct, APS Values and related Medicare Australia policies and guidelines
(fraud, conflict of interest, use of email and Internet, soliciting and acceptance of gifts, outside
employment and workplace harassment) and
Other relevant legislation, the FMA Act, the HIA, the NHA and the Medicare Australia Act 1973.
Certified agreement
During 2004–05 and into 2005–06, negotiations were held between Medicare Australia management,
staff representatives and the Community and Public Sector Union for a new certified agreement. As
Medicare Australia became part of the APS in October 2005, significant changes to the preceding
agreement were necessary. In addition, the new agreement established for the first time a clear link
between salary increases and performance. A key element of the agreement is that half of the annual
four per cent pay increase in 2006 and 2007 is dependent on organisational goals being met, and
individual performance of a satisfactory or higher standard.
Of the four per cent annual increase payable in 2006and 2007, one percent was dependent on
Medicare Australia meeting organisational goals, and a further one percent was dependent on
individuals achieving a rating of ‘fully effective’ or higher in their performance assessment. The
agreement was supported by over 75per cent of employees who cast a vote, and certified on 5
December 2005.
With the move to Public Service Act 1999 coverage, it was necessary for Medicare Australia to comply
with APS classification rules and to reflect APS values in its agreement. Full compliance with the Act
and the government’s Policy Parameters on Agreement Making was achieved and is reflected in the
2005–08Certified Agreement (CA).As at 30 June 2006, 5,108 staff were covered by that agreement.
Australian Workplace Agreements (AWAs)
As at 30 June 2006, 242 non senior executive staff and 43 senior executive staff were covered by
AWAs. AWAs were used to reward high performing staff, attract quality recruits, and to recognise
leadership in the organisation.
Considerable work was undertaken in 2005–06 to develop guidelines for managers and staff aimed at
supporting a regime of greater access to AWAs. A revised AWA template was developed to reflect the
introduction of the Work Choices legislation in March 2006.
Senior executive remuneration
Senior executive remuneration is offered as a package through an AWA. AWA remuneration levels are
subject to approval by the CEO and are based on work value, individual capability and contribution,
performance and relevant market considerations. Notional salary ranges for each classification level
are set with reference to relevant market comparisons.
These have regarded to:

the annual survey of APS SES remuneration commissioned by the Department of Employment and
Workplace Relations


general economic conditions and
Medicare Australia sustaining a high level of performance.
Senior executive remuneration is reviewed annually by the CEO at the end of the annual performance
cycle with regard to the organisational performance of Medicare Australia, individual performance and
relevant remuneration data.
Performance management
Under Medicare Australia’s Performance Support Program in 2005–06, all employees were required to
enter into a Performance Support Agreement with their manager.
All staff, whether SES or non-SES, on AWAs or covered by the CA, participate in the Performance
Support Program. The program links directly with the business planning process so employees can
understand how their work connects with the objectives of the wider organisation. Performance reviews
were undertaken in the mid-term review in December and the annual assessment in June/July. In
addition, managers and staff were encouraged to undertake quarterly reviews in September and March.
A five-point rating scale is used to assess employees under their Performance Support Agreement and
it is expected that managers will recognise gradations of performance against this scale.
As noted above, under the2005–08 CA one per cent of the four per cent December increase each year
and annual pay point advancement is conditional on staff receiving at least a rating of ‘fully effective’
(Medicare Australia’s performance standard).
Performance pay
All staff that are on AWAs are eligible for performance bonuses. Staff are assessed each June and,
where applicable, paid in September.
Learning and development
Medicare Australia developed, delivered and evaluated learning and development initiatives to provide
staff with the capabilities required to meet current and future business objectives. In particular,
during2005–06 the Learning and Development area of the organisation supported the roll out of Family
Assistance payments in conjunction with Centrelink, with training for all customer service officers in
Medicare offices to be completed by December 2006.
Other key learning and development strategies developed and implemented during the year were:










identified key capabilities (core skills) to support performance
a nationally consistent induction program
the Knowing the Business, Frontline and Corporate programs
technical program training
customer service officer training
a senior manager consultancy service
APS Values and Code of Conduct training
360 degree feedback for all senior managers
customer service skills training and
a ministerial writing program.
Leadership
Medicare Australia’s Leadership for Change Strategy provides the framework for our integrated
approach to leadership development within the organisation. This strategy is being revised and will be
incorporated into an organisation-wide capability review.
As part of the strategy, Medicare Australia continued to deliver Leadership Capability Framework
modules to middle and frontline managers during the year. In the national office a consultancy service
for senior executive development was established, with a particular focus on development that was
targeted to the needs of the individual. A commencement protocol for new SES was implemented to
complement the induction process, and ensure quick alignment with the organisation.
With the move into the APS, Medicare Australia is covered by the APS Values and Code of Conduct.
Training programs to ensure understanding of both have been developed for all staff. Managers will
undergo face-to-face training, and then deliver modularised training to their staff.
Core skills
Each employee’s Performance Support Agreement has a learning and development plan, and from
these, core skills training needs are assessed, and targeted programs delivered. High-priority areas
include project management, writing, interpersonal communication, information technology use and
time management. As part of the core skills program, Medicare Australia continues to deliver several
blended learning programs utilising the Harvard Manage Mentor Plus online learning resource.
Medicare Australia also expanded its suite of core skills programs as a response to gaps identified by
senior managers.
Induction
Consistent with Medicare Australia’s commitment to providing the best start for new staff members, a
national induction program was implemented during 2005–06. This program provides nationally
consistent information for all new starters. Delivery format varies to meet local needs across Medicare
Australia’s offices.
Knowing the Business Program
The Medicare Australia Knowing the Business Program continued through the year. This program
allows national office staff to visit state localities to work on the frontline and gain an understanding of
the pressures and challenges experienced in Medicare offices and call and processing centres. In
addition, state based staffs visit the national office, for up to three days, in order to better understand
the operation of national programs, and to gain a deeper understanding of specific areas of interest.
Feedback indicated high levels of staff support for this program, and a greater appreciation for the
breadth and complexity of our activities.
Customer service skills
Providing timely and targeted training and development for our frontline staff is a key focus of the human
resources team. The key element of this is the customer service officer program, which provides a
structured environment for staff to learn how to provide great customer service. Significant work has
been undertaken to ensure alignment of the customer service officer competency framework with the
changing business structure.
In addition, several new eLearning modules addressing corporate and operational needs were
released. These covered Medicare operations, the Consumer Directory Management System, finance
systems, OH&S induction, equity and diversity, fraud and privacy, security, human resource reports
and APS values.
Equity and diversity
Medicare Australia’s Equity and Diversity Plan 2004–07entered its second year ofoperation amid an
environment of organisational change.
To ensure consistency of understanding amidst that change, Medicare Australia introduced an equity
and diversity eLearning module in July 2005 as part of its National Induction Program. This module
provided all new employees with an understanding of what equity and diversity means in Medicare
Australia, outlining the equity and diversity principles, roles and responsibilities.
In March 2006 all staffs were given direct access to their online equity and diversity data in order to
update it themselves. This will help better ensure Medicare Australia has an accurate reflection of its
workforce profile as it changes.
Medicare Australia identified a need to increase the number of Aboriginal and Torres Strait Islander
employees to two percent of its staff by the end of 2008. As at June 2006, Medicare Australia had just
over one per cent of staff that identified themselves as Aboriginal and/or Torres Strait Islanders. The
2006 Action Plan for advancing the recruitment, development and retention of Aboriginal and Torres
Strait Islander employees within Medicare Australia identified a range of strategies to help achieve this
aim.
Medicare Australia launch edits first Statement of Commitment to Reconciliation on Tuesday 30 May
2006.The Minister, CEO and the Chief Executive of Reconciliation Australia co-signed the statement,
which is displayed across the organisation as a statement of Medicare Australia’s ongoing commitment
to improved service delivery to, and increased recruitment of, Indigenous Australians.
Occupational health and safety
Medicare Australia is committed to securing the health and safety of all its employees at work, in
accordance with the requirements of the Occupational Health and Safety (Commonwealth
Employment) Act 1991. An Occupational Health and Safety (OH&S) Policy and OH&S Agreement are
in place and are available to all employees through the Medicare Australia OH&S intranet site.
The Medicare Australia OH&S Agreement provides a framework for the establishment of an OH&S
Committee in each state and the national office to promote and support initiatives aimed at improving
the health, safety and wellbeing of employees. The OH&S Agreement also provides for Health and
Safety Representatives (HSRs) and deputy HSRs to be selected by employees to represent each
designated work group.
The Safety Management Unit, located in the national office, provides a strategic focus on the
development of preventative strategies, with a view to reducing the number and severity of workplace
injuries. National office and each state headquarters have a designated position responsible for the
day-to-day operation of OH&S, rehabilitation and compensation programs and initiatives.
Significant achievements in 2005–06
As highlighted by the Com care Injury Management scorecard, Medicare Australia continued to improve
return-to-work case management practices, resulting in the containment of average claim costs and a
reduction in the time taken to initiate rehabilitation intervention after injury.
DHS agencies worked together to share OH&S policies and procedures and develop a common health
and safety representative training package, via quarterly meetings hosted by Medicare Australia.
OH&S activities during 2005–06
Coordination of activities across Medicare Australia remained a high priority. The Safety Management
Unit provided quarterly reports to state managers on their compensation and injury management
performance. These reports provided information on how each state’s performance contributed to
meeting Com care health, safety and rehabilitation targets. Quarterly teleconferences were held with
each state manager, HR manager and OH&S case manager to assist states achieve targets.
Monthly teleconferences were conducted with all state and national office OH&S case managers. The
teleconferences assisted OH&S case managers to keep abreast of the latest OH&S and compensation
issues as well as initiatives within Medicare Australia, and provide advice and support on specific cases.
During July and August2005 Com care conducted risk management training for managers in all states.
In October, November and December 2005 Com care conducted a manual-handling audit as part of its
Manual Handling Targeted Investigation Program. Com care is yet to provide a report on each site
investigated and a whole-of agency report.
Medicare Australia actively participated in a number of OH&S conferences, forums and strategies
during2005–06 including:

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managing OH&S in ‘Times of Change’ conference in November
World Day for Safety and Health at Work in April with various activities conducted including
education and awareness sessions on good posture, back care, healthy breakfasts and lunches,
OH&S quizzes and daily emails on various OH&S topics
‘Accident Investigation and Complex Cases’ forum in May and
Continued participation in the interagency job placement program. This strategy was developed by
Com care to assist agencies to address the economic and social losses that occur when an
employee on workers compensation is unable to return to their original place of work following an
injury.
The statutory report required under section 74 of the Occupational Health and Safety (Commonwealth
Employment) Act 1991 is included in Appendix A.
Access to personal information
Personal information held by Medicare Australia is protected by legislation and there are penalties for
employees who improperly use or disclose personal information. Medicare Australia only holds the
personal information it needs for programs it administers and to meet audit and post-payment review
requirements.
Requests for release of personal information are processed in accordance with the relevant legislation,
for example: the HIA, the NHA, the Privacy Act 1988, and the Freedom of Information Act 1982 (FOI
Act). Appendix B contains a detailed report on the release of information under the FOI Act.
Medicare Australia’s computer systems can provide an audit trail of operator access that enables
detection of possible inappropriate use of data. Our staff are regularly reminded of their obligations
regarding the use of personal information and 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 well-being 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 Section of the Legal, Privacy and Information Services Branch plays a fundamental role in
raising awareness of privacy issues through training, participation in various privacy forums and expert
advices provided to internal and external stakeholders.
Medicare Australia has developed Privacy Impact Assessment (PIA) guidelines and a checklist to assist
managers to identify whether a PIA is necessary for their project. PIAs are an analysis of personal
information flows and potential privacy risks and impacts of a project.
The purpose of conducting a PIA is to mitigate privacy risks and impacts, ensure compliance with legal
obligations and build best privacy practice into projects.
Medicare Australia aims to implement PIAs across the organisation for all new programs or existing
programs that anticipate significant changes to their current systems. Medicare Australia meets its
legislated training responsibilities by ensuring that all employees, ongoing and non-ongoing (including
contractors and consultants) complete the National Privacy and Security Training Module. This training
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 is currently being developed and will be implemented in
2006–07.
External stakeholders have benefited from high quality products developed by the Information and
Access Delivery Section. These include a series of manuals for use by Information Release staff as
well as forms tailored for most customers to assist in streamlining the processes for requesting
information and assistance from Medicare Australia.
The Australian public and employees can access a wide range of privacy related information from the
Medicare Australia Internet and intranet.
Consultancies
We engage consultancies when we do not have sufficient specialist expertise available or when we
consider that independent assessment is desirable. Consultancies have covered such matters as
advice on:




the appropriateness of senior executive classification levels within Medicare Australia prior to
transition into the APS
the customization of the product to deliver the Stakeholder Management System
reporting on the annual financial statements’ processes to effectively meet mandated requirements
and
reporting on the costal location process to clarify the processing costs associated with Family
Assistance.
During 2005–06, 25 new or extended consultancy contracts were entered into involving total
expenditure of $3.48 million.
Consultants or consulting firms who were paid $10,000 or more during 2005–06 are listed in Appendix
D.
National procurement
The main focus in this area over the past 12 months has been the transition to Medicare Australia from
1 October 2005 as a statutory agency under the FMA Act.
All procurement policies and procedures were reviewed and rewritten to accord with the legislative and
government requirements. They now provide detailed operational guidance to Medicare Australia’s
officials/delegates on financial management, including procurement. In addition Medicare Australia’s
Chief Executive Instructions were overhauled to align them with our revised purchasing procedures
and guidelines.
One of the four principles issued by the DHS articulates the requirement for its agencies to combine
their requirements wherever practicable to maximize combined purchasing power. As a consequence
Medicare Australia has offered to be the lead agency for the procurement process so secure an
Employee Assistance Program Provider Panel. The process requires Medicare Australia to:



coordinate the seven agencies’ detailed input
develop and finalize a transparent approach to the market and
Develop a fair and ethical selection process and result within a reasonable timeframe.
National property
The NSW State Headquarters was successfully relocated from 150 George Street to130 George Street
following the end of the lease term. The fit out of this office incorporates the latest design features for
office accommodation including open plan layouts, ample meeting rooms and no offices.
The relocation of the Victorian state headquarters to new premises will be completed during the
financial year. This will result in better amenities for staff and provide a more efficient work place in an
open plan configuration.
Family Assistance services started rolling out to the Medicare branch offices. This incorporated a new
look and feel for these offices and included new signage and co-branding. The new fit out was trialed
successfully and is being rolled out to all offices following the introduction of the Family Assistance
services from the branch office. This work is scheduled for completion before the end of the 2006.
A fit out manual for the office accommodation will be developed. This will ensure that a consistent
design is maintained across office environments and that designs will meet business needs and
ergonomic design principles.
The Environmental Management System (EMS) will begin implementation of various business
practices and properties following endorsement of the EMS policy and operational framework.
A major consolidation program was undertaken following the reduction in staff numbers in the national
office. This exercise reduced the leased area required to accommodate staff numbers and therefore
allowed the removal of two buildings totaling 3,775 square meters from the leased property portfolio.
The consolidation of Medicare Australia’s accommodation in the Tuggeranong area will continue in the
2006–07financial year. Investigations will continue into available accommodation options that will
address Medicare Australia future accommodation needs.
Records management
With the move into the APS, the issue of appropriate record management has received considerable
attention. Key activities undertaken during the year have been:



intensive records management awareness training in state offices and national office
an eLearning package on records management awareness, creation of corporate files and the
classification of records — this will be released to all staff in July 2006 and
a commitment by Medicare Australia to fully implementing an Electronic Documents and Records
Management System (EDRMS) in national and state offices.
The framework for implementing records management within Medicare Australia has been developed.
The principal challenge facing us in 2006–07 is managing the change agenda for this activity with the
plan to transfer to using an EDRMS.
Assets management
New non-financial measures have been identified to ensure the efficient and effective management of
property assets. These measures will be included in the balanced scorecard from June 2006. Financial
performance measures will be identified and included in the scorecard by September 2006.
Environmental sustainability
Medicare Australia has embraced sustainable environmental practices for many years and is
continually building on these practices. Aligning these with sound sustainable environmental principles
under an Environmental Management System (EMS) will bring about further improvement in the current
practices.
Medicare Australia continues to implement the following measures to improve its performance:







maintaining energy consumption below the benchmarks set for Commonwealth operations
taking into consideration the Australian Building Green Rating when leasing office accommodation
recycling 100 percent of used toner cartridges
providing collection facilities for paper recycling and other recyclable material
transitioning the national fleet of motor vehicles to vehicles with higher green
vehicle scores and
complying with local government water conservation regulations and encouraging staff to reduce
water usage.
Medicare Australia has developed an EMS framework to further these measures in line with the
international standard for EMS. The EMS plan will identify and set targets in 2006–07 and will be put
into operation utilizing the additional resources and documentation developed this financial year.
In addition, Medicare Australia introduced the following measures in 2005–06 to enhance its
environmental performance:



funding identified to implement the plan as per the framework
environmental policy statement developed and
continuing improvements made to the National Fleet to better the green vehicle rating including
encouraging the use of Eco fuel.
Section 04 Programs
Medicare
Medicare Australia’s universal health insurance scheme was established in 1984 to ensure all
Australians contribute towards the cost of health care according to their ability to pay.
This entitles them to receive:


free treatment as a public patient in a public hospital and
Free or subsidized treatments by general practitioners (GPs) and specialists, as well as some
optometry, dental and allied health treatment.
As part of the policy announcements made during the 2004 election campaign, the Australian
Government strengthened Medicare by making GP services more affordable and accessible to all
Australians.
Key business results
We processed 247.4 million services, representing almost$11 billion in Medicare benefits. The figures
in the following tables are adjusted on an accrual accounting basis.
Medicare expenditure
2004-05
2005-06
% Change
Radiation
oncology
health program grants $36.0 million
paid
$36.9 million
+2.5%
Total benefits paid
$10.1 billion
$10.93 billion
+8.2%
Persons enrolled a
20.5 million
20.7 million
+1.0%
Active cards
11.4 million
11.6 million
+1.8%
166.0 million
177.2 million
+6.7%
70.4 million
70.2 million
-0.3%
236.3 million
247.4 million
+4.7%
$41.99
$44.37
+5.7%
Average period service
14.2 days
to lodgement b
13.5 days
-4.9%
Average
lodgement
processing c
3.9 days
-17.0%
Enrolments
Claims
Medicare
services
bulk
billed
Patient
services
claimed
Total
processed
services
Benefits
Average
service
benefit
per
period
to 4.7 days
a. 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.
b. Time between date of a medical service and lodgment of a Medicare claim.
c. Time between date of lodgment and processing of a Medicare claim.
Medicare claiming
The 247.4 million services were processed by cheque, cash and electronic funds transfer for paid
accounts. Unpaid accounts were paid by cheques issued to the provider via the claimant.
Medicare
services by bill 2004–05
type
%
2005–06
% Change
Cheque paid to
4.6 million
claimant
1.9
4.5 million
1.8
Cheque paid to
practitioner
via 16.1 million
claimant
6.8
14.6 million
5.9
Cash—paid
via
34.7 million
Medicare offices
14.7
34.5 million
14.0
70.3
177.2 million
71.6
5
13.1 million
5.3
1.3
3.5 million
1.4
100%
247.4 million
100%
Bulk Bill—benefit
assigned
to
166 million
practitioner
by
claimant
Simplified Bill—inhospital claims
11.8 million
Lodged
electronically
Electronic funds
3.1 million
transfer
Total
236.3 million
Online claiming
Online claiming enables providers to make claims over the Internet including Medicare bulk bill, patient
claiming and DVA claiming. It also enables providers to submit information to the Australian Childhood
Immunization Register.
Online patient claiming has continued to be disappointing, resulting in a major review of this claiming
channel in2005–06.
Medicare Australia online
2004-05
2005-06
% Change
Number
of
sites
3,315
transmitting online
5,369
+ 62.0%
Number of bulk bill
services
processed 16.5 million
using online claiming
43.8 million
+165.5 %
2.9 million
+190.0%
Number
services
of
patient
1 million
processed using online
claiming
Education and communication
Medicare Australia uses a range of communication channels and tools to let the Australian public knows
about Medicare. These activities include displaying brochures, posters and fact sheets in Medicare
offices and at Easy claim booths, inserting fliers with direct mail activities, and posting information on
our website. Our brochures are also available from doctors’ surgeries and pharmacies.
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 (FTB)(A) threshold applies to concession cardholders and
families eligible for FTB(A). Medicare will pay 80 per cent of the out-of-pocket cost for medical
services provided out of hospital, after a threshold of $500 is reached, per registered family or
individual per calendar year.
Note: 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 $1000 is reached,
per registered family or individual per calendar year.
The gap threshold applies to all Medicare cardholders and is based on the difference between the
Medicare Benefits Schedule fee and the Medicare benefit paid for out-of hospital services. Medicare
will pay the full 100 per cent of the Medicare Benefits Schedule fee after the gap threshold of
$345.50 is reached, per registered family or individual per calendar year.
Medicare eligibility
People who reside in Australia are eligible for Medicare benefits if they:




hold Australian citizenship
have been issued with a permanent visa
hold New Zealand citizenship or
Have applied for a permanent visa (restrictions apply to people who have applied for a parent visa
— other requirements apply).
Australian citizens who have resided overseas for more than five years, and permanent resident visa
holders who have resided overseas for more than12 months, are required to demonstrate their intention
to permanently reside in Australia before a Medicare card can be issued to them.
Medicare cards and Medicare levy exemptions
Medicare
2004-05
2005-06
% Change
Total cards issued a
3,276,204
3,354,997
+2.4
Total applications
22,907
26,342
+15.0
Accepted applications
22,119
25,580
+15.6
Rejected applications
788
762
-3.3
Cards
a Includes health care cards issued under reciprocal health care agreements.
Eligible visitors to Australia
The Australian Government has signed reciprocal healthcare agreements with some countries, which
entitle residents of those countries to restricted access to health cover while visiting Australia. Currently,
these countries are Finland, Ireland, Italy, Malta, New Zealand, Sweden, Norway, the Netherlands, and
the United Kingdom.
Improved services for migrants and conditional migrants
During 2005–06, Medicare Australia and the Department of Immigration and Multicultural Affairs (DIMA)
continued to work together, through the electronic transmission of information, to:



improve service delivery for people who have applied for, or who have been granted, permanent
residency status in Australia
reduce administrative burdens associated with establishing Medicare eligibility and
Simplify Medicare enrolment.
Staff at Medicare Australia also worked closely with migrant resource centers and volunteer groups
dealing with migrants to provide information regarding Medicare requirements.
Medicare cards
Medicare cards are issued to eligible people to make it easy for them to access Medicare benefits.
There are four different Medicare cards, designed to visually indicate to medical professionals and their
staff the person’s level of Medicare eligibility.




A Green Medicare card is issued to Australian citizens and permanent residents and is an
indication that the eligible consumer has access to all eligible Medicare services.
A Blue Interim Medicare Card is issued to consumers who are granted eligibility to Medicare while
their application for Australian permanent residency is under consideration — the interim card is an
indication to medical professionals and their staff that the eligible person has time-limited access to
all Medicare eligible services.
A Yellow Medicare Reciprocal Health Care Card is issued to visitors to Australia who are
residents of countries with which Australia has reciprocal health care agreements — their access to
Medicare services is time limited and does not cover treatment as a private patient in a public or
private hospital and
A Green Medicare Smartcard is issued to Australian citizens and permanent residents who live in
Tasmania and is an indication that the eligible person has access to all eligible Medicare services.
Allied health and dental care initiative
The Medicare allied health and dental care initiative allows a chronically ill person who is being
managed by their GP under an enhanced primary care (EPC) plan to access Medicare rebates for
allied health and dental services.
From 1 January 2006, the methodology for counting patient eligibility for Medicare rebates for eligible
allied health and dental care services changed to ‘a calendar year’ instead of ‘a 12 month period’
(counted from the date patients have their first allied health and dental care service). That is, eligible
patients are able to access rebates for five allied health and three dental care services between 1
January and 31 December each year where these services are recommended in their EPC plan.
Patients under an EPC plan who have dental problems that are significantly adding to the seriousness
of a chronic condition can access three consultations for dental treatment with a maximum rebate of
$229.05 a year.
From 1 January 2006, exercise physiology services were included under the Medicare allied health and
dental care initiative. Exercise physiologists must be registered with Medicare Australia to provide these
services.
The following allied health professionals can participate in the initiative:

Aboriginal health workers

exercise physiologists

osteopaths

audiologists

diabetes educators

physiotherapists

chiropodists

dieticians

podiatrists

chiropractors

mental health workers

psychologists

dental practitioners/specialists

occupational therapists

speech pathologists
Other payments
Medicare also provides a number of other payments for individuals and families who may need
assistance because of high medical expenses.
Medicare Australia Special Assistance
Special Assistance encompasses schemes that have been developed in response to natural and
human caused disasters that result in Australians requiring assistance with health care. The Special
Assistance system was developed to provide a platform for processing registrations and claims
following disasters, and currently includes Balimed, Tsunami, London Assist and Egypt Bombing
Healthcare Costs Assistance.
Note: Each special assistance scheme has categories that determine the eligibility criteria. These
categories can differ under each scheme.
Balimed
In recognition of the extreme difficulties faced by survivors of the bombings that occurred in Bali,
Indonesia, on 12 October 2002, the Balimed scheme was established. The scheme assists Australian
residents and eligible overseas nationals with all out-of-pocket health care expenses incurred in
Australia to treat survivors’ injuries. Balimed also covers the costs of counselling, psychological and/or
psychiatric treatment. This is extended to family members and friends of survivors of the Bali bombing
who may require care as a result of their relationship with the survivor.
Tsunami Healthcare Assistance
Tsunami Healthcare Assistance (THA) was established in recognition of the extreme difficulties faced
by survivors of the tsunamis in the Indian Ocean on 26 December 2004. THA covers all reasonable out
of-pocket health care expenses incurred in Australia to treat survivors’ injuries. THA also covers the
costs of counselling, psychological and psychiatric treatment for family members of people who were
injured, lost or killed, who may require care as a result of their relationships with those people.
London Assist
London Assist was established in response to the London terrorist bombings on 7 July 2005. The
Australian Government announced that it would provide assistance for injuries sustained as a direct
result of the bombings. The scheme covers out-of-pocket health care expenses incurred to treat
survivors’ injuries. It also covers the costs of counselling, psychological and/or psychiatric treatment.
This is extended to family members and friends of survivors who may require care as a result of their
relationship with the survivor.
Dahab Egypt Bombing Health Care Costs Assistance
In response to the bombing in Dahab, Egypt on 24 April 2006, the Australian Government has
announced that assistance will be provided for injuries sustained as a direct result of the bombing.
The scheme is known as Dahab Egypt Bombing Health Care Costs Assistance Scheme and covers
the costs of counselling, psychological and psychiatric treatment for family members of people who
were injured, lost or killed, who may require care as a result of their relationships with those people.
Veterans’ Affairs activities
2004-05
2005-06
% Change
64,492
75,503
+17.1%
Services processed
21.54 million
21.52 million
-0.1%
Total benefits paid
$1.75 billion
$1.82 billion
+4.0 %
Provider
produced
cards
Veterans’ Affairs processing
Medicare Australia processes medical, hospital and allied health services claims for veterans on behalf
of the DVA. A service level agreement between Medicare Australia and DVA outlines the services,
service standards and financial arrangements.
Key business results
We processed 21.52 million services, totaling over $1.8 billion.
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 subsidies the up take of Broadband for Health Qualified Services by eligible locations.
The subsidy is set at a level sufficient to meet the full installation and 12 months usage of a least one
broadband qualified service.
Visiting Medical Practitioners Program
Through an agreement with the Health Department in Western Australia, Medicare Australia offers a
visiting medical practitioner fee for-service payment and information system. The system provides
public non-teaching hospitals in Western Australian with an intranet processing system (in real time) to
access and pay invoices submitted by visiting medical practitioners for services to public patients.
The agreement has been in place since April 2000.
Key business results
Medicare Australia has assessed invoices valued at approximately $67.9 million for around 354,375
lines processed.
Medicare office network
New flexible business hours
To provide increased access to Medicare Australia services, we introduced a flexible approach to
Medicare office opening hours during 2005. A total of 193 Medicare offices across Australia are now
open longer Monday to Friday. In July 2005, 54 of these Medicare offices introduced extended evening
hours on Thursday or Friday evenings. These additional hours of business, in conjunction with the 115
Medicare offices that are open on Saturday morning, enable Medicare Australia to provide an enhanced
level of service, convenience and greater choice for customers accessing Medicare Australia services.
Medicare Australia conducted a survey in all Medicare offices to gather feedback on the changes to
office opening hours. The following statements summarize the feedback:

‘Opening hours that help full-time workers would be great.’

‘Always friendly service, but Saturday mornings or late Thursday shopping opening hours would be
very desirable.’

‘It would be useful for full-time workers to have access outside of normal opening hours.’

‘Open for late night shopping in the suburbs would be good.’
In addition to the survey, we completed a review of uptake of the new business hours to evaluate the
effectiveness of each office in meeting the service demands of the community within current business
hours.
Our findings indicate that whilst people visited Medicare offices for a range of services during the new
business hours, demand for cash claims was the highest.
Medicare office design
We have developed a new ‘Medicare office of the future’ design and are progressively introducing it as
we relocate or refurbish offices. The new design provides a modern, customer-friendly space with
convenient access to Medicare Australia services including Family Assistance.
To enable people to sit during their interaction with our staff, we have introduced ergonomic low
counters. An increased public space incorporates a combination of modular and standard seating
arrangements designed to suit different people’s requirements.
We responded to customer requests by providing seating that, along with the introduction of electronic
queue ticket systems in our offices, provides the convenience of comfortable sit-down waiting.
We surveyed the Australian public to assess their acceptance of the new office design initiatives and
they told us:

‘Airy and open spaces but privacy while doing business’

‘Better than standing in a queue — less congestion’

‘New store layout is great’

‘Delighted with new ticketing system, hope other office layouts can change’

‘Modern and very efficient’

‘More visually appealing and comfortable’‘

‘Much nicer than any Medicare office I have been in before’

‘Everything is user friendly and comfortable’

‘Light and airy design and color scheme’

‘The comfortable seating while waiting and the fairness of the queue system, the whole system is
great!’
Enhancing the total customer experience in the Medicare office was part of the core strategy for
implementing the new technology. The queue management systems have assisted in achieving this
outcome by improving the management of customer flows to better meet expectations and drive
workforce-planning improvements.
The latest Medicare office design will also include a ‘self-help’ service zone that is easily accessible to
customers. The zone contains a ‘drop-off’ box that allows customers to lodge claims and forms without
the need to queue, a dedicated telephone line with direct access to our Information Centre staff and a
personal computer that provides online access to all DHS websites through the DHS portal.
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 located
in rural transaction centers, state government agencies and shop fronts, post offices, pharmacies and
many other shops and service outlets.
Many things people do in a Medicare office can also be done at a Medicare Australia Access Point. As
well as claiming a Medicare benefit, a person can request tax statements from Medicare, update their
Medicare details and sign up for the Australian Organ Donor Register. The booths also provide
information about the PBS and the Australian Childhood Immunization Register.
The locations of Medicare Australia Access Points are available on Medicare Australia’s website.
Pharmaceutical Benefits Scheme
The Pharmaceutical Benefits Scheme (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 subsidizes the cost of listed prescription medicines, making them more
affordable for all Australians.
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 RPBS.
In the following report, unless otherwise noted, ‘PBS’ indicates both the PBS and the RPBS.
Our responsibilities
We are responsible for the operation of the PBS, which involves:

processing pharmacists’ claims

administering safety net arrangements

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 NHA to:

pharmaceutical companies, for the supply of in-vitro fertilization hormones, fertility drugs and
botulinum toxin and

fund medications under the Highly Specialized Drugs Program.
We make payments to colostomy and ileostomy associations for ostomy supplies. We also make
payments under a program separate from the PBS to fund the use of Herceptin for the treatment of
patients with metastatic breast cancer.
PBS eligibility
There are two levels of eligibility for the PBS — general and concession. A general person pays up to
$29.50 for their prescription medicine, and a concession person pays up to $4.70 for their prescription
medicine. These figures are adjusted annually in line with the CPI and do not cover additional costs on
more expensive brands of medicines.
To receive subsidized medicines through the PBS, each time a person gets a prescription filled they
must show their pharmacist a current:

Medicare card

concession card from Centrelink and/or DvA if applicable or

A PBS safety net entitlement or concession card if applicable.
This ensures subsidized medicines are only provided to those who are eligible to receive them, and the
person pays the appropriate amount dependent on their level of eligibility.
PBS safety net
The PBS safety net helps protect individuals and families who spend a lot of money on prescription
medicines in a calendar year. Each year the government sets a general and concession safety net
threshold. The 2006 safety net threshold is $960.10 for the general threshold and $253.80 for people
holding concession cards from Centrelink or the DVA.
Once the relevant safety net threshold has been reached, customers can apply for a safety net card
and PBS medicines will be cheaper or free for the rest of the calendar year.
Any additional costs on 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 or hand this form
in whenever they have a prescription filled or, if they frequent the same pharmacy, they can ask the
pharmacist to keep an electronic record.
PBS safety net 20 day rule
On 1 January 2006, Medicare Australia implemented the new budget measure known as the ‘PBS
Safety Net 20 day rule’. This measure has resulted in specific medicines being excluded from the PBS
safety net entitlements where they have been dispensed within 20 days of a previous supply under the
‘immediate supply’ provisions.
This means that:

the cost will not count towards a person’s safety net threshold and

If the safety net threshold has been reached, the charge will be the person’s usual PBS contribution
not the reduced safety net amount.
The new rule encourages responsible use of the PBS. The change supports good practice for safe use
of medicines and will help to make best use of funding for the PBS.
The rule only applies to certain PBS medicines for long-term therapy and only when the next supply is
obtained within 20 days. It does not apply to any medicines for acute conditions or short-term use such
as antibiotics. More information about which medicines are affected can be found at
www.health.gov.au/pbs.
Key business results
We processed 183.3 million services, representing $6.2 billion in benefits paid under the PBS and the
RPBS, collectively called the PBS.
PBS expenditure
2004–05
2005–06
% change
PBS benefits paid $5.7 billion
(including Stoma)
$5.8 billion
+1.8%
RPBS benefits paid
$475 million
$469.7 million
-1.1%
Total amount paid
$6.2 billion
$6.3 billion
+1.6%
PBS
processed
services 169.6 million
168.2 million
-0.8%
RPBS
processed
services 15.7 million
15.2 million
-3.2%
Stoma services (incl. 570,904
ostomy preparation and
appliances)
593,147
+3.9%
Total
processed
183.3 million
-1.4 %
services 185.9 million
Online claiming for PBS
Online claiming for PBS was developed in response to pharmacies’ requests for better and faster ways
to claim PBS benefits. As a result of feedback from the pilot of online claiming for PBS (conducted in
2004–05) Medicare Australia and pharmacy software vendors have worked together to address a
number of major issues identified.
The main areas of focus in 2005–06 were:

the provision of additional functionality in both Medicare Australia and dispensing software systems
to assist with the payment reconciliation process

the implementation of improved help desk arrangements, whereby pharmacies only need to use a
single telephone number to contact Medicare Australia for all PBS services and

The review of reason code wording for pharmacies to ensure reason codes and associated details
are clear and informative.
Medicare Australia is working closely with the Pharmacy Guild of Australia (the Guild) and software
vendors to discuss and resolve their issues and concerns. A fortnightly Implementation Working Group
has been set up with the Guild and the software vendor industry for this purpose. In addition, monthly
forums are held with all pharmacy software vendors to discuss operational and technical issues. The
Guild also attends these forums.
As a result of the improvements made in the 2005–06 financial year, it is anticipated that the uptake of
online claiming for PBS by the broader pharmacy community will greatly increase in 2006–07.
Medicare Australia continues to work closely with the Guild and software vendors regarding the future
roll out of online claiming for PBS to ensure that the product meets the needs of pharmacies.
Education and communication
Medicare Australia uses a range of communication channels and tools to let consumers and
pharmacists know about the PBS.
The How to save money on medicines brochure is a key communication tool to inform consumers about
the PBS safety net, less expensive brands of medicines, and ways of using medicines wisely. This
information is available from Medicare offices and our website as well as from pharmacies and some
doctors’ surgeries.
One of the key ways we provide information to pharmacists is through a quarterly Medicare Australia
publication, Bulletin Board, which provides information on a range of administrative and topical issues
related to the PBS.
Concessional Entitlement validation
The Concessional Entitlement validation (CEV) initiative was announced in the 2003–04 federal
Budget. The main business objectives of the initiative were to:

improve concession data quality with Centrelink;

implement an online capability for pharmacies to check a customer’s concession status; and

reduce the number of inappropriate concessional claims and ensure only those that are eligible
access the PBS at the concessional level of subsidy.
As part of the CEV initiative, improvements have been made in both Medicare Australia and Centrelink
systems that have allowed Medicare Australia to move forward in implementing improved checking to
ensure only those people eligible access the PBS at the concessional level of subsidy.
In December 2004, monthly PBS statements were updated to include warning details of PBS medicines
dispensed at concessional rates to customers without concessional entitlement on the date of service.
As a result of this, a reduction of one per cent in the rate of inappropriately supplied prescriptions has
occurred.
Online claiming for PBS enables pharmacists to conduct an on-the-spot check of a customer’s
concessional status. Online pharmacies are notified of a customer’s concessional status when
dispensing PBS medicines. This allows the pharmacist to make an informed decision regarding the
level of copayment to charge to the customer.
Throughout 2005–06 Medicare Australia has continued to work with Centrelink to ensure the objectives
of the initiative are achieved. In addition, Medicare Australia has closely monitored the results of CEV
checking for both offline and online pharmacies to identify further areas of improvement and ensure
only those who are eligible access the PBS.
Approval of authority prescriptions
Authority medications are limited to use for specific conditions and medical practitioners must obtain
prior approval from Medicare Australia before issuing any PBS authority prescriptions. Of the 1,578
PBS items listed, 926 are restricted to use for a particular condition or purpose. Of these 926 items,
429 are subject to criteria set by the Pharmaceutical Benefits Advisory Committee, which limits medical
practitioners to supply by authority prescription.
Medical practitioners may also write an authority prescription if they need an increased supply to treat
an individual patient.
In 2005–06, 6.7 million authority prescriptions were approved, with 5.8 million of these being handled
by telephone through our 1800 service which operates 24 hours a day, seven days a week.
Approval to supply PBS medicines
Section 90 of the NHA enables us to grant approval to a pharmacist to supply PBS medicines. We
received 356 applications for new or relocated pharmacies. These were referred to the Australian
Community Pharmacy Authority and 264 pharmacies were recommended for approval. Of the
remainder, 50 were not recommended and 42 were withdrawn.
We granted approval to:

859 community pharmacies to supply PBS medicines to the community under section 90 of the NHA
(including 605 change of ownership and 254 relocations/new approvals)

21 medical practitioners to supply PBS medicines to rural/remote communities under section 92 of
the Act

18 hospital authorities to supply PBS medicines to hospital patients under section 94 of the Act (6
private hospitals and 12 public hospitals participating in the pharmaceutical reforms).
This brings the total number of approvals at 30 June 2006 to:

4,973 section 90 approved community pharmacies

81 section 92 approved medical practitioners

176 section 94 approved hospitals (58 private hospitals and 118 public hospitals participating in the
pharmaceutical reforms).
Fourth Community Pharmacy Agreement
The Fourth Community Pharmacy Agreement between the Australian Government and the Pharmacy
Guild of Australia has been in place since 1 December 2005. Under the agreement we are responsible
for making the various payments described below.
Payment types covered by the Fourth Community Pharmacy Agreement
Payment type
Description
Aboriginal Health Services — Pharmacy Support A financial incentive for pharmacy proprietors to
provide support services to Aboriginal health
Payment
services in rural and remote locations in
Australia.
Barcode Reader Costs Reimbursement
A financial incentive that allowed approved
pharmacies to claim reimbursement for the costs
incurred in installing barcode readers between 1
January 2003 and 31 December 2005 to facilitate
the correct dispensing of prescribed medication.
Broadband for Health/Pharmacy — Disaster A financial incentive, available for a limited time,
that is payable to pharmacies to assist them in
Recovery Payment
Payment type
Description
upgrading their personal computer systems to
facilitate the satisfactory use of broadband.
Designed to allow patients’ medication regimes to
be reviewed on the request of the patient,
medical practitioner or carer.
Home Medicines Review
Home Medicines Review — Rural Loading Designed to reimburse pharmacies in rural and
remote areas of Australia for travel costs incurred
Payment
when conducting home medicines reviews.
Improved Monitoring of Entitlement Medicare A payment to approved pharmacies for the
residual administration costs of recording
Number Allowance Payments
Medicare numbers on PBS prescriptions This
payment was incorporated into the pharmacy
dispensing fee from 1 December 2005.
Medicines
Information
Participation Allowance
to
Consumers A payment, made every two months, to
pharmacies that provide consumer medicine
information. This payment was incorporated into
the pharmacy dispensing fee from 1 December
2005.
Quality Care Pharmacy Program
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.
Rural Pharmacy Maintenance Allowance
A financial incentive to encourage pharmacy
proprietors to remain in designated rural and
remote locations in Australia.
Start-up Allowance
A payment, staggered over two years, to
encourage the establishment of new pharmacies
in designated rural or remote locations.
Succession Allowance
A payment, staggered over two years, to
encourage pharmacists who want to purchase an
existing pharmacy in an identified area of need.
Training Incentive
Assistants
Payment
for
Pharmacy A financial incentive to encourage pharmacy
assistants to undertake the Certificate III in
Community Pharmacy.
Payments
There were 64,663 payments made under Third and Fourth Community Pharmacy Agreement
initiatives in 2005–06 totalling over $40 million. Pharmacies can obtain further information about
payments under the agreement via Medicare Australia’s website.
Indigenous people’s access to the PBS
During 2005–06, Medicare Australia continued to administer the PBS arrangements that make
prescription medicines accessible in remote Indigenous and Torres Strait Islander communities.
We continued to pay pharmacists for the bulk supply of PBS medicines to remote Indigenous and
Torres Strait Islander communities via the Aboriginal and Torres Strait Islander Health Service
(ATSIHS), and some state funded health services.
These arrangements are enabled under section 100 of the NHA and currently make prescription
medicines accessible to patients receiving treatment at over 165 remote area ATSIHS 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 patients in public hospitals. Key features of the reform are
to extend the PBS to admit patients on discharge and to outpatients, and to provide access to
chemotherapy drugs for day patients of public hospitals.
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 gradually implemented across Queensland, Victoria and
Western Australia. Doctors in approved public hospitals in those states can prescribe PBS items to
non-admitted patients (outpatients) and admitted patients on discharge. The medication may be
supplied from the approved public hospital pharmacy or from an approved community pharmacy.
DVA beneficiaries are included in the pharmaceutical reforms, and the same rules apply to RPBS
benefits.
The Australian Government will continue to liaise with other states and territories, seeking agreement
to implement the reforms.
At 30 June 2006, we had approved 118 public hospitals under these arrangements — 62 in
Queensland, 51 in Victoria and 5 in Western Australia — and paid benefits of more than $90 million.
RPBS processing
A project was undertaken to upgrade the DVA RPBS authority processing system. Phases 1 and 2 of
the project were implemented during 2004–05 and delivered functionality to extend the recording of
compliance information and improve system usability.
Phase 3 of the project was conducted during the 2005–06 financial year and included a range of system
developments aimed at providing DVA with more complete, timely and accurate data relating to the
RPBS program.
Australian Organ Donor Register
The Australian Organ Donor Register is administered by Medicare Australia and provides a simple way
for people to record their consent (or objection) to becoming organ and/or tissue donors.
The register ensures that an individual’s consent (or objection) to donating organs and/or tissue for
transplantation 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. Prior to this only a person’s intention to donate was registered. The
details of those people who had previously recorded their intention to donate will be retained on the
register until they complete a ‘consent’ registration form.
During the year the wide distribution of the organ donation brochure and registration form, through
Medicare offices and state based organ donor agencies, also created awareness and increased
general registrations. Promotion also occurred through doctors’ surgeries and the Medicare Australia
website.
Medicare Australia also supported Australian Organ Donor Awareness Week in February 2006 with
targeted promotions in Medicare offices, on Medicare Australia’s website and through the Good Health
TV network available in some doctors’ surgeries. The key message for Australian Organ Donor
Awareness Week was ‘organ donors save lives’.
Key results
The new Medicare claim form that was introduced in February 2006 now includes the option of
registering as an organ and/or tissue donor. Minister Hockey promoted the new claim form at the launch
of Australian Organ Donor Awareness Week on 19 February 2006. The number of registrations through
Medicare claim forms between that time and 30 June 2006 was 1,525.
Access to view current registrations in the Australian Organ Donor Register became available through
Customer Online Services on 1 October 2005.
There are now 791,320 individuals who have registered their consent to organ and/or tissue donation
(this includes the ‘intent’ registrations of 16–17 year olds) on the Australian Organ Donor Register.
Website
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

statistics on 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 information recorded on the donor register via a secure Internet
site. They are authorised by a management committee comprising representatives from Medicare
Australia, DoHA and state organ donation agencies.
Australian Organ Donor Register
2004–05
2005–06
% change
Number of consent N/A
registrations (including
the intent of 16–17 year
olds)
791,320
N/A
Number of registrations 5,234,703
of
potential
organ
donors*
4,823,095
-7.9%
Number of serviced 53,643
calls to enquiry line
40,585
-24.3%
* Potential organ donors refer to those people who had previously registered their intent on the organ
donor register and have not updated this to consent to donate.
Australian Childhood Immunization Register
The Australian Childhood Immunization Register is a national database that was established in January
1996. The aim of the Immunization Register is to improve the rate of age appropriate immunization and
to support parents and providers through the provision of information about a child’s immunization
status.
Details of vaccinations given to children under seven years in Australia are recorded on the
Immunization Register and are available on request to immunization providers and each child’s parent
or guardian. Medicare Australia has a secure area on our website that provides a channel for authorized
immunization providers to access information and updates a child’s immunization details on the
Immunization Register.
Information for parents about the Immunization Register was published in a number of parent and family
magazines and outlets including a special feature in our Indigenous magazine, Well and Good. Over
the past year a revised brochure for parents about the Immunization Register was also distributed
through Medicare offices and immunization providers. Medicare Australia participated in baby expos
and health information days providing further education and promotion of the Immunization Register.
Information for providers about the National varicella vaccination Program, the new combination
vaccines and updated forms were available via the Medicare Forum magazine. Updated and enhanced
guides and publications were also produced to help providers access the secure pages of the website.
A number of conferences for immunization provider groups were also held throughout the year.
How the Immunization Register data is used
Health professions use the Immunization Register to monitor immunization coverage levels and service
delivery, and to identify regions at risk during disease outbreaks.
Immunization Register data also:

enables immunization providers and parents to check on the immunization status of an individual
child, regardless of where the child was immunized

forms the basis of an optional immunization history statement that informs parents and guardians
of their child’s recorded immunization history

provides information about a child’s immunization status to help determine eligibility for the Child
Care Benefit and the Maternity Immunization Allowance family assistance payments

provides a measure of immunization coverage at the local, state/territory and national level

provides information for the delivery of feedback reports and incentive payments to eligible
immunization providers and

provides reporting mechanisms to assist the Australian Government’s monitoring of national
immunization programs.
Key results
Immunization history statements are sent to parents as their child turns one, two and five years of age,
and at any other time upon request. Statements were available via Medicare Australia’s Online Services
facility from October 2005. In December 2005, statements became available from Medicare offices.
Parents thus have immediate access to the statements when they require information for school and
childcare Centre enrolment, and to assist with eligibility for some family assistance payments.
As at 30 June 2006, 14,036 child history statements had been viewed online and 25,572 had been
received immediately over the counter from Medicare offices.
In November 2005 varicella (chicken pox) vaccination at 18 months of age was added to the routine
schedule of vaccines provided free under the National Immunization Program. Several new
combination vaccines were also introduced, reducing the number of vaccinations a child needs to have
at the one time. These changes also included amendments to the manual forms and secure online
facility used to report vaccinations to the Immunization Register.
The 10-year anniversary of the Immunization Register was celebrated on 1 January 2006. Since
commencement of the register, the nationally reported immunization coverage rates have increased
from 53 per cent to levels now consistently above 90 per cent. The Minister for Human Services
conducted a celebration to mark this occasion at a Victorian Child Care Centre, with community groups
and state/ Federal Government departments, MPs and Senators attending.
At 30 June 2006, 1.9 million children under seven years of age were included on the Immunization
Register.
A total of $8.3 million was paid to immunization providers, and 4.0 million valid immunizations were
recorded on the Immunization Register during 2005–06.
Immunisation rates of children in Australia
2004–05
2005–06
% change
Children under 7 years 1.8 million
registered at 30 June
1.9 million
+5.6%
Valid
immunisation 4.5 million
episodes recorded at
30 June
4.0 million
-11.1%
2004–05
2005–06
% change
Children aged 12–15 91.0%
months appropriately
immunised at 30 June
90.7%
-0.3%
Children aged 24–27 91.7%
months appropriately
immunised at 30 June
92.4%
+0.8%
Children aged 72–75 83.2%
months appropriately
immunised at 30 June
83.9%
+0.8%
Total amount paid to $8.7 million
immunisation providers
$8.3 million
-4.6%
General Practice Immunization Incentives Scheme
The General Practice Immunization Incentives (GPII) Scheme provides financial incentives to GPs who
monitor, promote and provide immunization services to children under the age of seven years.
The overall aim of the scheme is to encourage at least 90 per cent of practices to achieve 90 per cent
proportions of full immunization.
Providers are kept up to date on changes to the GPII scheme by:

content on our website, which includes a quarterly information sheet, statistics, general program
information and downloadable forms for providers and Divisions of General Practice

representation at various professional conferences and

ACIR field officers in each state and territory who provide support to practices and providers via the
GPII enquiry line.
Key business results
Data from the May 2006 calculation shows that the GPII scheme had 5,491 registered practices. The
average immunization coverage rate for practices was calculated at 91.41 per cent for 2005–06, with
76.3 per cent of participating practices achieving rates of 90 per cent or higher.
General Practice Immunization Incentives scheme
Practices registered
Service
payments
2004–05
2004–05
% change
5,480
5,491
+0.2%
$18.8 million
+2.6%
$14.7 million
-4.5%
incentive $16.7 million
Outcome payments
$15.4 million
2004–05
2004–05
% change
Adjustment
payments
outcomes $1.5 million
$1.7 million
+13.3%
Total
payments
outcomes $16.9 million
$16.4 million
-3.0%
Highest
quarterly $10,358.60
outcomes payment
$10,301.20
-0.6%
Average
payment
$994.51
+1.0.%
$35.2 million
+4.5%
outcomes $985.05
Total Payments (SIP + $33.7 million
Outcomes)
Payments and information
The GPII scheme is made up of three components:

a Service Incentive Payment — an $18.50 payment to GPs and other medical practitioners who
notify the ACIR of a vaccination that completes an immunization schedule

an Outcomes Payment — a financial reward for practices that achieve 90 per cent or greater
proportions of full immunization and

Immunization Infrastructure Funding — funds provided to Divisions of General Practice, state-based
organizations and the National GP Immunization Coordinator, to improve the proportion of children
who are immunized at local, state and national levels. DoHA administers this component.
Practice Incentives Program
The Practice Incentives Program (PIP) provides a number of incentives that aim to help general
practices improve the quality of care provided to patients. 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, the Hon Tony Abbott MP announced
changes to the PIP to simplify and improve the program. A change was made to the PIP after hours
incentive to enable some smaller practices (with less than 2,000 Standardized Whole Patient
Equivalents) to be eligible for after-hours tier two. Further changes to other elements will be
implemented in the next financial year.
The News Update, a quarterly information sheet about current and future program activities and
incentives keeps providers up to date on changes to the PIP. This is posted to practices and is also
accessible on the Medicare Australia website.
The Medicare Australia website also displays statistics and general program information which can be
downloaded by providers and divisions of general practice.
Types of payments
There are eleven PIP components, as described in the table below and practices may qualify for any
or all of them.
Payment types covered by the PIP
Payment type
Description
Information management/Information technology
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
After-hours care
Payments to practices to ensure that patients
have access to 24-hour care, including afterhours
home visits where necessary
Teaching
Payments to practices for teaching medical
students
Quality Prescribing Initiative
Payments to practices that participate in the
quality use of medicines program endorsed by
the National Prescribing Service
Practice nurses/Allied health worker
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
Cervical screening
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
Diabetes
Payments to practices that achieve targets in
providing care for their patients with diabetes,
and payments to GPs for providing diabetes care
according to best practice guidelines
Asthma
Payments to practices for providing the Asthma
3+ program, and payments to GPs who complete
an Asthma 3+ plan for patients with moderate to
severe asthma
Payment type
Description
Mental health
Payments to GPs for using the Three-step Mental
Health Process with their patients
Procedural GP payment
Payments to practices to support the provision of
procedures such as surgery, anaesthetics and
obstetrics in rural and remote areas
Rurality
A rural loading applied to the PIP payments of
practices where the main location is outside a
capital city or other major metropolitan area
* Provision of at least 10 hours care from the practice commenced in May 2006.
Key business results
At 30 June 2006, 4,745 practices were registered as participating in the PIP and a total of over $261.8
million worth of incentive payments were made.
Services provided under the PIP
2004–05
2005–06
% change
Number of practices 4,681
participating at 30 June
4,745
+1.4%
Provision of data to the 4,681
Commonwealth
4,745
+1.4%
Electronic prescribing
4,307
4,417
+2.6%
Capacity for electronic 4,364
transfer
4,480
+2.7%
Ensuring patients have 4,554
access to 24-hour care
4,601
+1.0%
Provision of at least 15 3,116
hours care from the
practice
2,858
-8.3%
Provision of at least 10
hours care from the
practice *
262
After-hours care
2004–05
2005–06
% change
1,296
-4.5%
83,496
+6.9%
1,203
+0.2%
337
-0.9%
Practice nurse and/or 1,617
allied health workers
1,756
+8.6%
Cervical screening
3,103
3,187
+2.7%
Diabetes
1,920
2,023
+5.4%
Total amount paid
$253 million
$261.8 million
+3.5%
Provision of all after- 1,357
hours care for practice
patients
Teaching
Number of
sessions
teaching 78,114
Targeted incentives
Quality
Initiatives
Prescribing 1,201
Procedural GP
340
Rural Retention Program
The Rural Retention Program (RRP) aims to improve health care for people in rural and remote areas
of Australia through a system of incentive payments to medical practitioners practicing in these 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 these areas. There are two components of the program:


The Central Payments System — administered by Medicare Australia since December 1999. This
system seeks to recognize general practitioners’ contributions in rural and remote locations, based
on their Medicare service data over a number of years.
The Flexible Payments System (FPS) — administered by state based and territory-based rural
workforce agencies since December 2000. This system recognizes long-serving general
practitioners 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.
Key business results
We made 2,071 payments totaling $20.3 million to 2,021 providers participating in the RRP during
2005–06.
Medical practitioner participation in the RRP
2004–05
2005–06
% change
1,939
+1.6%
Total CPS amount paid $18.4 million
$18.6 million
+1.1%
CPS percentage paid
98.6%
+0.1%
132
-18.0%
Number
of
payments made
Number
of
payments made
CPS 1,908
98.5 %
FPS 161
Total FPS amount paid
$2.03 million
$1.7 million
-16.3%
FPS percentage paid
98.8 %
98.5%
-0.3%
Total amount paid
$20.4 million
$20.3 million
+0.5%
CPS=Central Payments System, FPS=Flexible Payments System
General Practice
Payments Scheme
Registrars’
Rural
Incentive
Since 2000, funds totaling over $100 million have been used to boost general practice training in rural
and remote areas through the dedicated 200 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 will 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.
8.
capital city
other metropolitan Centre
larger rural Centre
small rural Centre
other rural area
remote Centre
other remote area
Offshore island.
Financial incentives are offered to medical practitioners who undertake training in the Rural Training
Pathway in practices located in rural, remote and metropolitan areas that can particularly benefit from
the scheme, as determined under an eight-part location classification system (for more information
about the system visit 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).
Key business results
We made payments totaling $6.7 million to 426 medical practitioners participating in the General
Practice Registrars’ Rural Incentive Payments Scheme in 2005–06.
General Practice Registrars’ Rural Incentive Payments Scheme
2004–05
2005–06
% change
Number of medical 444
practitioners paid
426
-4.1%
Number of payments 814
made
786
-3.4%
Total amount paid
$6.7 million
0%
$6.7 million
Training for Rural and Remote Procedural GPs
Program
The objective of the program is help general practitioners in rural and remote areas to attend relevant
training, upskilling and skills maintenance activities. The program has two components:

a grant for the cost of up to two weeks training, including the cost of locum relief to a maximum of
$15,000 per general practitioner per financial year for procedural general practitioners practicing in
surgery anesthetics or obstetrics in rural and remote areas (RRMA 3-7) and

a grant for the cost of up to two training sessions, to a maximum of $3,000 per general practitioner
per financial year for general practitioners practicing emergency medicine in rural and remote areas
(RRMA 4–7) to attend approved skills maintenance and upskilling activities.
Key business results
The expansion of the program to include the emergency medicine component was introduced on 1
February 2006 and payments may be backdated to include activities undertaken from 1 January 2006.
Training for Rural and Remote Procedural GPs
2004–05
2005–2006
% change
Number of registered 723
providers
1,323
+83.0%
Number of providers 639
paid
767
+20%
2004–05
2005–2006
% change
Number of payments 946
made
1,514
+60%
Total
amount
payments
$5.4 million
+45.9%
of $3.7 million
Compensation Recovery Program
The Compensation Recovery Program, which began in February 1996, aims to prevent ‘double dipping’
in Medicare benefits, nursing home benefits or residential care subsidies paid by the government in
relation to an injury or illness, where a person receives compensation.
Medicare Australia administers the program under the provisions of the HOSC Act on behalf of the
DoHA.
Eligible people who are claiming compensation can claim Medicare and/or nursing home benefits
and/or residential care subsidies from the date of their injury or illness to the date of judgment or
settlement of their cases.
However, once a case reaches judgment or settlement, the HOSC Act requires insurers or other
compensation payers to advise Medicare Australia of claims for compensation where the amount of
compensation provided is more than $5,000, inclusive of all costs.
The process begins with a Notice to Claimant, including a Medicare history from the date of injury. The
claimant is required to identify Medicare, nursing home or residential care services, which relate to the
compensable injury and return this to Medicare Australia. From this list, Medicare Australia determines
the amount of benefits and/or subsidies, if any, that have been paid for treating the compensable
condition. Under the HOSC Act, Medicare Australia is required to recover this amount on behalf of
government.
The HOSC Act has been modified on a number of occasions since its inception, the most recent being
in 2001 and 2006. The latest changes in 2006 were mostly technical, with one repealing a sunset clause
on the advance payment option (APO). Many insurers and claimants favors the APO as it provides for
the release of 90 per cent of the compensation to the claimant, with 10 per cent being forwarded to
Medicare Australia. 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.
Key business results
This year Medicare Australia experienced a slight, but anticipated, increase in both the volume of cases
finalized and the value of recoveries made.
Compensation recovery cases and benefits
Cases finalised
Total
amount
benefits recovered
2004–05
2005–06
% change
47,365
49,232
+ 3.9%
$31.3 million
+18.6%
of $26.4 million
HECS Reimbursement Scheme
The HECS Reimbursement Scheme was announced in the 2000 Budget as part of the regional health
strategy known as more doctors, better health services. This initiative aims to promote careers in rural
medicine and increase the number of doctors in rural and regional areas.
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.
Key business results
During 2005–06 we made payments totaling $2.1 million to 272 medical graduates participating in the
HECS Reimbursement Scheme.
HECS Reimbursement Scheme
2004–05
2005–06
% change
Number of eligible 300
medical
graduates
participating
421
+40.3%
Number of medical 218
graduates paid
272
+24.8%
Number of payments 378
made
440
+16.4%
Total amount paid
$2.1 million
+23.5%
$1.7 million
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; in Medicare offices, Centrelink
customer service Centre’s and ATO shop fronts.
The main payments and services provided by Family Assistance include:

Family Tax Benefit (A) which provides help with the cost of raising children

Family Tax Benefit (B) which provides extra help for families with one main income, including sole
parents

Child Care Benefit (CCB) which offsets the cost of long and part-day child care

Maternity Payment which helps with the extra costs of a new baby and

maternity Immunization Allowance which is a separate payment for children who have been fully
immunized.
Since the commencement of the Family Assistance in July 2000, customers have been able to access
limited Family Assistance services at Medicare offices.
Currently, at all Medicare offices, Family Assistance customers can:

make enquiries

lodge forms for payments and

notify a change of their circumstances.
As agencies under the DHS tasked with improving services to our customers, Medicare Australia and
Centrelink have been working together to progressively deliver extended Family Assistance services
from Medicare offices. These extended services include claims processing and handling of all levels of
customer enquiries. A phased implementation commenced on 1 July 2005 and is scheduled for
completion by all 238 offices by December 2006. The number of Medicare offices able to offer
customers extended Family Assistance services is ahead of schedule. As at 30 June 2006, the
extended services were available at 190 Medicare offices throughout Australia. The roll out has been
completed in Western Australia, the Northern Territory, South Australia, the Australian Capital Territory
and Tasmania.
With the extension of Family Assistance services, customers can now have their claims for Maternity
Payment, Maternity Immunization Allowance, Child Care Benefit (CCB) and FTB processed when they
visit one of the 190 fully Family Assistance enabled Medicare offices. They can also change their
income estimate, method of payment and their contact details.
As at 30 June 2006 nearly 130,000 Australians have accessed extended Family Assistance services
in Medicare offices since the roll out commenced. Customer satisfaction with the provision of extended
Family Assistance services has been independently measured. Results show strong support from
customers accessing the extended services, both with the level of service received at Medicare offices
and in the greater choice given to customers in where they can access Family Assistance products and
services. visit www.familyassist.gov.au for more information about the Family Assistance.
Key business results
Family Assistance services
2004–05
2005–06
% change
Total
services* 304,674
provided to families
380,405
+24.9%
Medicare
offices N/A
offering access to
extended
Family
Assistance services
190
N/A
Total
number
of N/A
customers accessing
extended
Family
Assistance services
129,025
N/A
* Total services include the number of forms submitted for payment and number of enquiries to
Medicare offices.
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 the 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 their behalf.
Key business results
This year we processed 898,483 services and made payments totalling $203 million to accredited
hearing service contractors. Approximately 95 per cent of all claims are submitted via electronic data
interchange.
Hearing Services Program services and payments
2004–05
2004–05
% change
Services processed a
870,365
898,483
+3.2%
Total amount paid b
$194 million
$203.1 million
+4.7%
a
Service provided to individuals
b
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 Federal Budget, the Australian Government allocated $43.4
million over three years for the phased introduction of a national bowel cancer screening program.
This program will reduce the number of people who die from bowel cancer which is the most common
internal cancer affecting Australians and the second-highest cause of cancer-related deaths, behind
lung cancer. Early diagnosis of bowel cancer or pre-cancerous abnormalities has been shown to
increase the chances of survival. This national program will build on the success of the Bowel Cancer
Screening Pilot.
In March 2006 the Minister for Human Services, the Hon Joe Hockey MP, gave approval for the CEO
of Medicare Australia to enter into a service arrangement with the Secretary of DoHA under subsection
7(2) of the Medicare Australia Act 1973. The service arrangement allows the CEO to provide
Commonwealth services relating to the administration of aspects of the National Bowel Cancer
Screening Program including the establishment and maintenance of the register to be known as the
National Bowel Cancer Screening Register (and matters incidental to providing these Commonwealth
services), subject to conditions specified in the service arrangement.
The challenge has been to develop and implement a population health screening register to support
the commencement of National Bowel Cancer Screening Program invitations from August 2006 and
provide a high level of customer service supporting the ongoing administrative role of the register.
To administer the National Bowel Cancer Screening Register Medicare Australia will:

identify and invite eligible participants to screen and re-screen at appropriate intervals using
Medicare enrolment and DVA enrolment files

provide a system of communication between participants and their medical practitioners to allow for
appropriate and timely follow up investigation

record participants’ screening and detection histories and

make payments to medical professionals for services and the transfer of data to the register.
Medical indemnity
The Australian Government’s medical indemnity framework comprises five schemes aimed at
strengthening the longer-term viability of the medical insurance industry and creating 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 provisions of the Medical Indemnity Act 2002.
Incurred but not Reported (IBNR) Indemnity Claims Scheme
Under this scheme, the government covers the costs of claims from medical defense organizations that
do not have adequate reserves to cover their liabilities. To date United Medical Protection Limited
(UMP) is the only medical defense organization actively participating in the scheme. This scheme
comprises of IBNR indemnity claims and Untied Medical Protection Support Payments (UMP SP).
Ongoing costs associated with the scheme are partly funded through a contribution payment (UMP SP)
imposed on those people who were members of UMP on 30 June 2000.
Key business results
IBNR Indemnity Scheme claims processed
2004–05
Number
received
of
claims 416
Total benefits paid
$8.7 million
2005–06
% change
375
-9.9%
$14.8 million
+70.1%
Participation and revenue under the UMPSP arrangements
2004–05
2005–06
% change
Number of members 18,239
invoiced a UMPSP
10,131
-44.5%
Total amount invoiced
$13.7 million
-43.9%
$24.4 million
High Cost Claims Scheme (HCCS)
Under this 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 dependant on the date the claim
was first notified to the insurer.
Notification date
Threshold amount
1 January 2003 to 21 October 2003 (inclusive)
$2,000,000
22 October 2003 to 31 December 2003 $500,000
(inclusive)
On or after 1 January 2004
$300,000
HCCS claims processed
2004–05
2005–06
% change
Total claims received
2
2
0%
Total benefits paid
$0.414 million
$0.065 million
-84.3%
Exceptional Claims Scheme
Under this scheme, 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 first notified to the insurer.
Run-off Cover Scheme (ROCS)
Under this 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
ROCS 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 2002.
Exceptional Claims Scheme notification date
Notification date
Threshold amount
1 January 2003 to 30 June 2003
$15,000,000
On or after 1 July 2003
$20,000,000
Exceptional Claims Scheme claims processed
2004–05
2005–06
Total claims received
nil
nil
Total benefits paid
$nil
$nil
ROCS implementation and compliance costs paid
2004–05
2005–06
Total implementation fees paid
nil
$1.81 million
Total Administration fees paid
$nil
$2.84 million
Premium Support Scheme (PPS)
Under this scheme, eligible medical practitioners receive financial assistance through a subsidized
reduction in their insurance premium costs, effective from 1 July 2004. Insurers are then reimbursed
the subsidized amount by the government.
The PSS is designed to ensure that if a doctor’s gross medical indemnity costs exceed 7.5 per cent of
his or her gross private medical income, he or she will pay twenty cents in the dollar for the cost of the
premium beyond that threshold limit.
Competitive Advantage Payment
Under this scheme, medical indemnity insurers that benefit from the IBNR Indemnity Scheme are
required to make a payment to the government that reflects their level of competitive advantage. To
date Australasian Medical Insurance Limited is the only insurer that has made a competitive advantage
payment.
Participation and revenue under the PSS
2004–05
Total
practitioners
eligible 4,441
Total amount paid
$24.4 million
2005–06
% change
4,139
-6.8%
$17.1 million
-29.9%
2005–06
% change
$2.2 million
-7.9%
PSS administration fees
2004–05
Total
fees
administration $2.39 million
Competitive payments received
2005–06
Total number of invoices
1
Total amount paid
$56 million
30% Rebate on Private Health Insurance
The 30% Rebate program (the program) continues to be a major component in the success of the
Australian Government’s initiative to encourage an appropriate and viable mix of private and public
provision of health services.
While still known as the 30% Rebate program, on 1 April 2005, the Australian Government expanded
the program 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 2005–06, the new rebates have been applied to approximately 518,000 claims per month,
resulting in an additional $171.25 million being paid by Medicare Australia.
Medicare Australia administers the program on behalf of the Australian Government and works with
DoHA, the ATO, the Private Health Insurance Advisory Council and health funds to further improve the
program’s administration.
Key results
The number of registered health fund memberships increased by two per cent. This increase coincided
with the expansion of the program in 2005.
There was a change in payments in 2005–06, with more customers opting to pay reduced premiums
directly to their health insurer, rather than paying a full premium and claiming the rebate back at a
Medicare office. In 2005–06, cash claims paid direct to individuals decreased to $2.14 million and health
fund payments increased to $3.05 billion.
30% Rebate on Private Health Insurance
2004–05
Number
memberships
registered
Total paid
claims
of 4.73 million
in
cash $2.29 million
Total paid to health $2.7 billion
funds
2005–06
% Change
4.84 million
+2.3%
$2.14 million
-6.6%
$3.05 billion
+13.0%
Program audit
Audits of 12 health fund entities that participate in the program via the Private Health Insurance
Premium Reduction Scheme were carried out during 2005–06. The purpose of these audits was to
identify differences between Medicare Australia and health fund data relating to the registration of
people who pay reduced premiums for private health insurance cover. The differences were identified
by comparing the registration records at health funds with the registration records at Medicare Australia
and measuring the risk associated with Medicare Australia paying a health fund for a policy which is
not eligible for the Premium Reduction Scheme.
Medicare Australia also conducted audits of health fund procedures for the identification and processing
of dishonored 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
Premium Reduction 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

were correct in respect of payments made by the member

were claims for valid participants in the Premium Reduction Scheme and

were supported by member application.
The audits concluded that procedures being applied continued to reduce the risk of incorrect or
inappropriate payments being made to health funds. However, recommendations designed to further
strengthen and/or improve aspects concerning data completeness or evidence of participant validity
were also made and implemented by the health funds audited.
Program risk management
Compliance program
Medicare Australia’s compliance program is based on a risk-management approach involving activities
to detect, prevent and correct non-compliance. In 2005–06, as well as administering the compliance
program, the Program Review Division (PRD) also continued to implement a number of budget
initiatives designed to stem rising Medicare and PBS costs and realize savings to the Australian
Government in the form of reduction in expenditures on the Medicare and PBS schemes.
The Division’s three major compliance activities are:
1. Detection – via hotlines, data scanning and targeted detection and audit activity
2. Prevention – via education programs and information services
3. Correction – via feedback to practitioners, recovery of benefits, prosecutions and review of
practices.
1. Detection
Medicare Australia’s compliance program is dependent on intelligence and analysis identifying potential
non-compliant behavior by medical practitioners, pharmacists, patients and members of the public.
Information subjected to analysis may be obtained from tip-offs, random sampling of claims data, and
targeted detection techniques and processes. Audit programs are also carried out to assist in identifying
areas of risks while also achieving an administrative purpose of verifying whether claims and payments
are made correctly.
1.1 Fraud hotline
The public can contact Medicare Australia to report potential frauds through the following two hotline
numbers:

131 524 — DHS Fraud Tip-Off Service and

1800 202 011 — Medicare Australia’s Report a Fraud Line.
Calls to these numbers are administered by Medicare Australia’s call centre in South Australia.
Information received is referred to the state from which the call originated if further assessment is
warranted.
PRD, through its national office and state program review branches, also receives tip-offs from the
public via facsimile, letter and email. Referrals also come from other areas of Medicare Australia such
as reports from staff at Medicare offices when suspicious benefit claiming patterns or behaviour is
detected.
In 2005–06, a total of 1,706 calls, tip-offs and referrals were received by PRD.
These comprised:

1,064 calls made by the public to the fraud hot-line numbers and

642 tip-offs from the public or referrals from other areas in Medicare Australia.
Of these, 876 (51 per cent) warranted further assessment and follow-up.
1.2 Data scanning activities
In 2005–06, Medicare Australia continually scanned and analyzed Medicare and PBS data to identify
potential inappropriate claiming and anomalous behavior to support the design of targeted operations.
This detection activity comprises three general parts:
Environmental scan
PRD conducted a national workshop — with participants from Medicare Australia national office and
state-based compliance personnel, Centrelink, DHS and DoHA — to carry out an environmental scan
to support the development of the 2006–07 National Compliance Program.
The workshop and subsequent analysis by PRD identified six Medicare, seven PBS, one associated
government program, and three patient/public compliance issues warranting assessment and response
under the 2006–07 National Compliance Program.
Random compliance audits
These are post-payment reviews undertaken annually to provide assurance that Medicare and PBS
payments are valid and made in accordance with legislation. These audits are ongoing, with results
reported annually. They involve verifying all aspects of the randomly selected Medicare or PBS claims
with documents and parties relevant to the transaction.
In 2005–06, Medicare Australia audited randomly selected samples of:

5,294 PBS prescriptions from 127 pharmacies. Of these prescriptions, 708 were confirmed with the
prescribing medical practitioners and 498 were confirmed with the patients. This audit found that 99
per cent of the sample were supplied, claimed and paid correctly and

1,470 Medicare services claimed from 723 medical practitioners. Of these services, 955 services
were confirmed with the medical practitioners and 524 were confirmed with the patients. This audit
found that 99 per cent of the samples were provided, claimed and paid correctly.
Data reviews looking for anomalous behavior
Data reviews use sophisticated intelligence and data-mining tools to scan significant cross-sections of
the medical practitioner, pharmacist and patient populations.
In 2005–06, risk profiling by Medicare Australia identified 1,875 incidences where practice profiles by
medical practitioners warranted further assessment. These practice profiles were referred to state
program review branches for review
1.3 Targeted detection activities
Medicare Australia carries out audits and assessments targeting areas of high risks to the integrity of
the Medicare and PBS schemes. Significant targeted detection activities in 2005–06 included:

Analysis of data on people obtaining PBS in excess of medical need: on average, there are more
than six million patients who received over 40 million items of PBS medicines each quarter. To
efficiently analyze this large amount of data, a quarterly analytical program was implemented.
In 2005–06, Medicare Australia identified 90,974 incidences where patients may have obtained PBS
medicines in excess of medical needs. PBS (medicine) histories of these patients were examined and
medical practitioners of 4,638 patients were contacted to discuss their patient’s usage of PBS medicine
(further information appears later in this section).

Assessments of Medicare claims where data is analyzed to identify medical practitioners with
anomalous claiming patterns that may warrant further review by Medicare Australia’s medical
advisers.
In 2005–06, Medicare Australia completed 33 assessments with five assessments associated with
Medicare benefits worth over $100,000. These assessments are described in the following table.
Assessments of claims by selected Medicare items
Risk
Claim periods
No. of medical
Medicare
(months)
practitioners
benefits
Removal of superficial 12
foreign
body
(risk:
potential inappropriate
claims
using
a
Medicare item with
higher fee)
This focused on the $1,253,000
amount of benefits and
not the number of
medical practitioners
Addition or removal of 12
fluid from long-term
implanted
reservoir
(risk:
potential
inappropriate claiming
of an item associated
with
long-term
implanted reservoir)
196
$1,204,000
Small bowel intubation 12
(risk:
potential
inappropriate
claims
using a Medicare item
with higher fee)
61
$403,000
Repeat
3
musculoskeletal
ultrasounds occurring
on separate days
1,795
$192,000
Investigate
the 12
utilisation
of
items
42773 — Diathermy or
cryotherapy
for
detached retina
65
$118,000
and 42809 — Retina
photocoagulation (risk:
item 42773 should not
be claimed with item
42809 as the benefit for
item 42773 should
include the procedures
involved in item 42809)

Assessments of selected PBS medicines data is analyzed to identify medical practitioners with
anomalous prescribing behavior that may warrant further review by Medicare Australia’s medical
advisers and compliance pharmacists. Significant works completed in 2005–06 include
assessments on:
 Tramadol and Pethidine (for short-term management of acute pain) with 376 prescribers
identified and referred to state Program Review Branches for further assessment and
 Gabapentin (risk: the medicine may have been prescribed for neuropathic pains),
Risperidone (risk: the medicine may have been prescribed to children 12 years and under to
control aggression in ADHD), Rituximab (risk: the medicine may have been prescribed for
initial therapy instead of relapsed or refractory B-cell nonHodgkin’s lymphoma), Terbinafine
(anti-fungal treatment).
These assessments resulted in Medicare Australia sending targeted letters to selected medical
practitioners (further information appears later in this section).

Sixteen reports were produced in relation to overseas drug diversion (ODD). Major reports include:
 Four reports profiling vietnam, Egypt, Italy and Greece as potential destination points for
ODD. These reports were used to inform operations targeting potential drug ‘diverters’,
passengers travelling or suspect mail being sent to these countries
 Two reports into two patients suspected of overseas diversion of PBS subsidized medicines
worth in excess of $65,000. Medicare Australia has referred these cases to the Australian
Federal Police for criminal investigation and
 One report identifying a family engaging in identity fraud. Subsequent investigation found
that the family had falsely acquired an alternative set of Medicare cards with similar identities
to Centrelink concession cards. The matter was referred to Centrelink and is now under
investigation by a multi-jurisdictional taskforce including Medicare Australia and Centrelink.
1.4 Targeted audit programs
In 2005–06, Medicare Australia completed three targeted audit programs and commenced the fieldwork
on a further two.

Multiple Payments: 247 pharmacies were audited for having received two or more payments for the
one prescribed supply of a PBS medicine. Of these, 231 pharmacies were subjected to counselling
and/or recovery action with $890,000 of PBS benefits being recovered. Eight pharmacies were
referred for criminal investigation.

Electronic (Medicare) Bulk Billing: 8,795 claims by 143 practitioners were audited. The audit found
the level of non-compliance is low:
 two per cent of the audited claims did not have forms that were signed by patients and
 1.8 per cent of the audited claims did not have original forms.
A number of recommendations were made in light of the audit results. This includes re-running the
audit in 2006-07 with more patient contacts (to verify the services) and an education program to improve
medical practitioners’ awareness of compliance requirements associated with Electronic Bulk Billing.

Glycosylayted Haemoglobin (appropriate usage of diabetes tests): 73 medical practitioners were
audited. The audit has been completed with results to be reported in August 2006.

Broadband for Health initiative: 150 medical practices were selected for this audit. As at July 2006,
107 of the practices have returned the audit forms. It is anticipated that results of this audit will be
reported in August 2006.

Practice Incentive Payment: 245 practices (with 1,344 medical practitioners) were audited. 39
practices (16 per cent) were found to be non-compliant with $590,000 of incentive payments
identified for potential recovery.
2.0 Prevention
Education and communication play an important role in Medicare Australia’s approach to managing
program integrity. The focus of the education and communication compliance activities is to promote
compliance by explaining Medicare and PBS requirements to medical practitioners, pharmacists and
patients (including members of the public).
In 2005–06, Medicare Australia completed the following prevention activities:
2.1 New medical practitioners
Medicare Australia offers a face-to-face briefing to medical practitioners new to prescribing under the
PBS or providing Medicare services. New medical practitioners include recent medical graduates,
medical interns, experienced medical practitioners new to the Australian health system, and registered
medical officers working in public hospitals.
In 2005–06, Medicare Australia provided face-to-face briefings to 1,931 new medical practitioners.
(Note: in 2005–06, approximately 3,600 medical practitioners received a new prescriber and/or provider
number from Medicare Australia. Of these, 52 per cent completed their training overseas).
2.2 PBS education
To improve access to PBS education, Medicare Australia developed a CD-ROM entitled PBS and You
containing 33 essential units on the PBS and prescribing of PBS medicines. The CD is now available
to all medical practitioners attending briefing sessions by Medicare Australia. The CD is also sent to
medical practitioners who are unable to attend. An online application of the CD is now being developed.
In 2005–06, Medicare Australia distributed 3,082 CDs.
2.3 Experienced medical practitioners
The Prescription Shopping Information Service
Since 31 January 2005, Medicare Australia has operated a 24-hour telephone enquiry line, 1800 631
181, for registered medical practitioners to obtain selected information on patients they suspect are
obtaining PBS medicine in excess of medical need. As at 30 June 2006, there were 11,757 medical
practitioners registered with the service.
The following table presents monthly number of calls to the service and the number of patient reports
sent to medical practitioners by Medicare Australia.
In 2005–06, Medicare Australia received 15,790 calls to the service and sent 3,127 patient reports to
medical practitioners regarding patients identified as potentially obtaining PBS medicine in excess of
medical need.
In addition to the information provided to medical practitioners via the service, Medicare Australia also
distributed, on request, 20,929 brochures titled Getting more medicine than you need to members of
the public via medical practices, pharmacies, travel agencies and Medicare offices.
Medicare Australia also published articles in Forum and Bulletin Board, and advertised in print media
and prescribing software to help promote awareness of the service.
Restricted medicine and the PBS
In 2005–06, Medicare Australia offered a PBS education program to 174 medical practitioners in
selected Divisions of General Practice.
This program was developed in conjunction with medical practitioners and provided specific information
on the PBS restriction criteria when prescribing Proton Pump Inhibitors (used for the treatment of peptic
ulcers and gastric oesophageal reflux disease), Selective Serotonin Reuptake Inhibitors (used for the
treatment of major depressive disorders), and Serum Lipid Reducing Agents (cholesterol lowering
medicine).
Since April 2006, Medicare Australia has been offering education on the PBS restrictions that may
apply when prescribing medicine used for the treatment of asthma to 68 medical practitioners in
selected Divisions of General Practice. This education, delivered via Continuing Professional
Development events, comprises a presentation and case discussion supported by education materials
produced by Medicare Australia. This education will continue through 2006-07. Communication on PBS
restricted and authority required medicine.
In 2005–06, articles and information sheets were published in Forum and Bulletin Board on the
prescribing of PBS restricted and authority required medicine. Topics included writing non-PBS
prescriptions, and prescribing of Gabapentin, Terbinafine, Bone drugs and Selective Serotonin
Reuptake Inhibitors. In 2005–06, Medicare Australia also placed advertisements in print and prescribing
software to promote medical practitioners’ awareness of when to write a non-PBS prescription and of
Medicare Australia’s role in monitoring PBS prescribing. Pads of explanatory notes about non PBS
prescriptions were also sent to 161 medical practices.
Other face-to-face education
Medicare Australia also provided general education to medical practitioners and medical practices on
a variety of Medicare or PBS topics. The presentations and group discussion took place through
continuing professional development events and conferences. Approximately1,200 medical
practitioners attended these sessions.
Medicare Australia also provided general education to other professional audiences, including practice
staff, pharmacy assistants/dispensary technicians, allied health care workers dentists, Aboriginal
Medical Service workers as well as from Division of General Practice staff, NSW Refugee Health, and
Work Cover. In 2005–06, around 900 health professionals participated in these education sessions.
Online PBS education
Medicare Australia currently supports an online PBS education program via the Med-E-Serv PriMeD
website which is a company that delivers electronically based information and education services to
health professionals in Australia. This free service provides 23 interactive learning units on the PBS
which are designed to refresh and enhance medical practitioners’ knowledge of the PBS, in particular
understanding of the requirements and responsibilities when prescribing PBS subsidized medicine.
The education is accredited with the RACGP and ACRRM for continuing professional development
points.
In 2005–06, 696 health professionals completed 1,698 units. Of these, nearly 94 per cent (655) of users
were registered medical practitioners.
Pharmacy education
Medicare Australia delivers face-to-face education or provides input into university or other educational
institutions’ curricula for new pharmacists (including pharmacy undergraduates, immediate pharmacy
postgraduates, those who trained overseas and those who are re-entering pharmacy). In 2005–06, the
number of new pharmacists receiving PBS education was approximately 1,900.
Medicare Australia also provided face-to-face education on specific PBS topics in selected community
pharmacies and public hospitals. This education is designed to assist pharmacists to supply and claim
on the PBS in accordance with the relevant PBS legislation. In 2005–06, approximately 300
experienced pharmacists received PBS education.
Articles on a range of PBS topics were published in the in Bulletin Board including: discounted PBS
medicine, the Prescription Shopping program, a Home Medicines Review Audit, and multiple payments.
Taking or sending PBS medicine overseas
To reinforce awareness of the legalities of sending or carrying PBS subsidized medicine overseas,
Medicare Australia:

published articles in the Forum and Bulletin Board

advertised key messages to consumers (radio, press and electronic media) and to prescribers and
pharmacists (print and electronic media)

set up promotions in Medicare offices, at airports and in travel agencies and

provided education materials to the public via medical practices, pharmacies, travel agencies and
Medicare offices.
In 2005–06, as part of an ongoing communication campaign and as requested by medical practices,
pharmacies and travel agencies, Medicare Australia sent out 37,939 printed material items (including
brochure and information sheets in 18 languages) on taking or sending PBS medicine overseas.
Medicare Australia continued to provide, via the Travelling with PBS Medicine enquiry line, a national,
free information service for consumers on their rights and responsibilities when sending or taking PBS
medicine overseas.
In 2005–06, Medicare Australia received 10,575 calls to the enquiry line. The following table shows the
monthly numbers of calls since July 2002. The numbers of calls have increased significantly since the
start of the first communication program in December 2003.
Improving Medicare Compliance through Education
In September 2005, Medicare Australia sponsored independent market research on how to standardize
and strengthen education about Medicare to ensure that medical practitioners and their staff are
informed to comply with legislative and regulatory requirements.
In May 2006, the Australian Government announced a new budget measure Improving Medicare
Compliance through Education. The measure includes providing medical practitioners and practice
managers with educational materials on the use of Medicare item numbers (when providing Medicare
services) and providing targeted feedback over three years commencing in 2007 to approximately
10,000 medical practitioners with anomalous Medicare servicing patterns.
Fraud awareness training for Medicare Australia staff
Medicare Australia is also providing training, through our State Program Review Branches, on fraud
awareness to new staff as part of their induction or to existing staff in Medicare offices to maintain their
level of awareness of fraud issues. In 2005–06, Medicare Australia conducted 149 fraud awareness
training sessions in state offices.
3. Correction
The objective of this area of compliance activity is to intervene in and correct non-compliant behavior
by medical practitioners, pharmacists, patients and members of the public. Depending on the nature
and significance of the non-compliance, Medicare Australia may:

provide feedback in the form of letters to individuals to inform them of the behavior observed

interview the person to seek more information

recover benefits paid incorrectly

for medical practitioners, review their practice profiles and, if inappropriate practices are found and
continue after an intervention, refer them to the Director of Professional Services Review and

Investigate and refer cases to the CDPP where fraud is detected.
3.1 Feedback to patients and medical practitioners through the
Prescription Shopping Program
The Prescription Shopping Program aims to protect the legitimacy of patient demands on the PBS by
focusing on patients who may be obtaining medicine in excess of medical need.
As shown in the following table, in 2005–06, Medicare Australia sent letters to or met with 9,988 medical
practitioners discussing 4,638 patients who were suspected of obtaining PBS medicines in excess of
medical need.
3.2 Seizures of PBS medicines being illegal exported
A total of 27 cases of potential illegal exports of PBS medicine were detected in 2005–06. The majority
of the PBS medicines detained were earmarked for destruction and the exporters issued with warning
letters. Thirteen cases are being assessed for possible referral for criminal investigation.
3.3 PBS targeted feedback
Since 2004, as part of the implementation of the budget measure sustaining the Pharmaceutical
Benefits Scheme – Reinforcing the Commitment to Evidence Based Medicine announced in the 200203 Budget, Medicare Australia has been implementing a targeted feedback program to medical
practitioners on the requirements when prescribing PBS medicine.
In 2005–06, Medicare Australia sent letters to selected medical practitioners to remind them of the
requirement when prescribing under the PBS and/or how to write a private prescription where patients
are not eligible for PBS subsidy. Major targeted feedback activities include sending letters to:

1,328 medical practitioners who were at risk of prescribing Gabapentin outside of the PBS criteria

51 or top two per cent of medical practitioners who prescribed Risperidone

557 medical practitioners who prescribed Rituximab in the most recent claims period and

33 medical practitioners who prescribed Terbinafine with no record of a related Medicare record for
pathology within 12 months of the date of prescribing.
3.4 Recovery of benefits incorrectly paid
In 2005–06, Medicare Australia identified 5,288 persons who were the recipients of incorrect benefit
payments. The total amount identified for recovery was $4.65 million.
The following table shows the breakdown by medical practitioners, pharmacists and members of the
public.
Recovery data by number of people
Groups
Sep 05
Dec 05
Mar 06
Jun 06
Yearly total
Medical
practitioners
561
439
665
1,137
2,802
Pharmacists
33
55
19
49
156
Member of the 288
public
331
226
297
1,142
Others
294
351
242
301
1,188
Total
1,176
1,176
1,152
1,784
5,288
3.5 Criminal investigation and prosecution
Criminal investigation, and subsequent prosecution by the Commonwealth Director of Public
Prosecutions (CDPP), is one of the most powerful tools that Medicare Australia has in its effort to reduce
the incidence of fraud in the programs it administers.

Number of new investigation cases in 2005–06 was 377. This is 153 cases (or 68 per cent) higher
than 2004–05.

Number of referrals to the CDPP in 2005–06 was 65. This is 14 cases (or 27 per cent) higher than
2004–05.

Number of successful criminal prosecutions was down from 42 in 2004–05 to 32 in 2005–06.
Prosecution rates were down due to court delays and priorities. Medicare Australia has been
discussing these issues with the CDPP.
The following table compares Medicare Australia’s investigation effort in 2004–05 and 2005–06.
Investigation related data
Investigations
Groups
2004–05
2005–06
New cases
Medical practitioners
92
186
Pharmacists
27
32
Public
105
159
Total
224
377
Medical practitioners
99
172
Pharmacists
24
68
Closed cases
Investigations
Groups
2004–05
2005–06
Public
187
129
Total
250
369
92
124
34
30
Public
134
172
Total
260
326
Medical practitioners
7
6
Pharmacists
1
4
Public
43
55
Total
51
65
6
3
Pharmacists
1
2
Public
35
27
Total
42
32
Open cases (cases still Medical practitioners
under investigation)
Pharmacists
Referral to CDPP
Successful
prosecutions
criminal Medical practitioners
3.6. Practice Profile Review Process (PPRP)
Medicare Australia identifies and reviews medical practitioners whose Medicare or PBS data indicates
that their rendering, initiating or prescribing practice profiles appear different when compared with their
peers. This activity forms part of the national compliance program and may lead to medical practitioners
entering the PPRP.
Where the issue identified is not one of inappropriate practice but may constitute fraud (i.e. claims of
benefits for service not rendered), medical practitioners can be referred to criminal investigation and/or
prosecution.
The PPRP consists of:


the first stage (completed by Medicare Australia): a process of education and information gathering
and period of review and
the second stage (completed by Medicare Australia): interview and period of review and
assessment of behavior by medical practitioners’ following the first stage; and, with review by
Medical Director if concerns are not addressed.
The Medical Director may request the Director of the Professional Services Review (DPSR) to review
the provision of services by medical practitioners if there is a concern of possible inappropriate
practices.
The following table contains the PPRP statistics for 2005–06:
PPRP statistics in 2005–06
Types of Activity
Sep 05
A. Medical
131
practitioners
commenced
80
through
the
PPRP

Jun 06
Yearly Total
145
142
133
551
82
79
83
324
61
50
106
331
28
10
31
101
2
9
6
24
1
2
4
8
209
203
249
914
Number
referred to
second
stage
of
PPRP
C. Medical
7
practitioners
reviewed in the 1
second stage
of the PPRP

Mar 06
Number
referred to
first stage
of PPRP
B. Medical
114
practitioners
reviewed in the 32
first stage of
the PPRP

Dec 05
Request to
DPSR
Total (A+B+C+D)
253
In 2005–06, there were 914 incidences where Medicare Australia reviewed medical practitioners
through the PPRP. Of these:

551 incidences (60 per cent) were medical practitioners at the start of the PPRP

331 incidences (36 per cent) were medical practitioners in the first stage of the PPRP

24 incidences (3 per cent) incidences were medical practitioners in the second stage of the PPRP
and

In eight incidences (1 per cent), Medicare Australia referred medical practitioners to the DPSR.
DPSR statistics in 2005–06
Types
Activity
of Sep 05
Findings
of 3
inappropriate
practice
by
DPSR
Dec 05
Mar 06
Jun 06
Yearly Total
4
7
0
14
In 2005–06, the DPSR made 14 findings of inappropriate practices. The amount of benefits identified
for recovery through these processes was $1,041,000 (pursuant to agreements and final
determinations made under the PSR Scheme).
3.7 Medicare Participation Review Committees
Medical practitioners convicted of relevant offences against Medicare are referred to a Medicare
Participation Review Committee (MPRC) for review of their entitlement to provide Medicare services.
Practitioners with two findings of inappropriate practice by the DPSR are also referred to the MPRC.
The MPRC is an independent statutory body whose chair is appointed by the Minister for Health and
Ageing. An MPRC determination can result in up to five years of total disqualification from participation
in the Medicare and PBS schemes. Further disciplinary actions by state and territory (professional)
registration bodies are also possible.
In 2005–06, four cases were referred to the MPRC (see below) and the MPRC made determinations
on six cases (see below).
Cases referred to the MPRC in 2005–06
Type of practice
Number
Reason
Optometrist
3
Conviction for committing fraud
against the Commonwealth
General practitioner
1
Two findings by the DPSR of
inappropriate practice
Determinations by the MPRC in 2005–06
Type of determination
Number
Full disqualification from Medicare
3
Partial disqualification from Medicare
1
No further action
2
3.8 Suspension or revocation of approval of a pharmacist to supply
under the PBS
Following a charge or conviction for an offence related to the supply of pharmaceutical benefits, section
133 of the NHA allows the Minister for Health and Ageing to revoke the approval of a pharmacist, or for
the Secretary to DoHA to suspend the approval of a pharmacist to supply pharmaceutical benefits.
In 2005–06, action under section 133 of the NHA was considered in respect of approvals involving
three pharmacists:

one was suspended (from supplying under the PBS) pending trial

one was suspended for eight and a half months and

one was suspended for one month.
Online claiming
Medicare online claiming
Medicare Australia’s online claiming channel was introduced in 2002 to enable medical providers to
lodge claims, including Medicare bulk bill, private patient and DVA claims over the Internet, and to
submit information to the Australian Childhood Immunization Register.
Medicare Australia has been working closely with providers to implement online claiming and seek
feedback about its use. Practices are continuing to register at the rate of 150–200 per month. While
uptake of patient claiming for paid accounts has been lower than anticipated, bulk billing continues to
increase with 42.94 per cent of GP bulk bill claims submitted online. Eighteen case studies gathered
from practices around Australia currently using online claiming have highlighted the positive reception
of online claiming services. Comments from participants included:
‘It has made payments a lot quicker. We’re only a small practice but it means we can now process
every day’; and
‘It’s convenient, easy to follow and the backup services provided by the Medicare Australia are
fantastic.’
The significant benefit for the Australian public is the ability to lodge claims direct from the medical
practice following the consultation, thus eliminating the need to visit a Medicare office. In addition, if the
account has been paid, patients can choose to have their benefit paid directly into their nominated bank
account.
During 2005–06 online claiming was promoted through:

a series of road shows to doctors around Australia

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
and

Advertising in professional publications, mail-outs, brochures, media releases, electronic
newsletters and information sheets.
Online patient claiming has continued to be disappointing, resulting in a major review of this claiming
channel in 2005-06.
Key business results
2004–05
2005–06
Number of registered sites a
3,815
5,948
Number of transmitting sites b
3,315
5,369
Number of bulk bill services 16.5 million
transmitted
43.8 million
Percentage
services
24.69%
of
all
bulk
bill 9.93%
Providers transmitting bulk bill 11,905
services
20,186
Private patient claim services 1.1 million
transmitted
2.9 million
Percentage of all private patient 1.80%
claim services
5.12%
transmitted
Providers transmitting patient 3,360
claim services
6,475
a
Site that has registered to use online claiming and ECLIPSE. Registration is required as part of the
public key infrastructure security process.
b Site
that has transmitted a claim during the past two months.
ECLIPSE (Electronic Claim Lodgment and Information Processing
Service Environment)
Consultation with government and stakeholders within the private health sector identified a need for an
industry-wide, seamless eBusiness solution for streamlining the billing and claiming process for inhospital episodes of care. The current manual simplified billing process for billing and claiming for inhospital services was considered to be complex, inconvenient for patients and expensive.
In the 2004–05 Federal Budget, the Australian Government provided funding of $54.6 million over four
years to enable Medicare Australia, in collaboration with industry, to develop and roll out infrastructure
for secure electronic connectivity between private health funds, hospitals, doctors and Medicare
Australia. The ECLIPSE governance board, made up of representatives from participating sectors and
government, meets regularly to provide advice on the project.
ECLIPSE uses secure Internet connections between Registered Health Benefit Organizations
(RHBOs), medical practitioners, hospitals, billing agents and Medicare Australia to assist patients with
the lodgment of claims and the subsequent payment of accounts.
In July 2004, as a means of enhancing an enhancement to its online solutions, Medicare Australia
released the first stages of ECLIPSE to industry. During 2005–06, Medicare Australia delivered further
business functionality in Release 5 to allow medical Medicare online eligibility checking, DvA paperless
and pathology claiming and two-way agency claiming. Two way agency claiming allows the patient the
option of lodging their health fund claim at a Medicare Office or their Medicare claim at their health fund
office, for in-hospital services. Medicare Australia is working on Release 6 that will deliver hospital
claiming, hospital online eligibility checking and overseas claiming. A decision to concentrate on
ensuring all delivered functionality has been successfully bedded down has resulted in the suspension
of efforts to include ancillary claiming through Release 7.
Key business results
No of transmitting sites a
2004–05
2005–06
27
94
No of simplified billing services 13,335
transmitted
70,926
Percentage of
billing services
0.54%
all simplified 0.11%
Providers transmitting simplified 202
billing services
513
Online patient
transmitted
10.2 million
verifications 1.2 million
RHBOs connected to ECLIPSE
15
Percentage of privately insured 29%
population
represented
by
RHBOs connected to ECLIPSE
a
23
79.12%
Site that has transmitted a claim during the past two months.
ECLIPSE services transmission history, July 2004 to June 2006
Online Customer Services
Medicare smartcard — Tasmania
The Minister for Health and Ageing launched the Medicare smartcard in Tasmania in July 2004 as part
of the Australian Government’s national Health Connect initiative. The Medicare smartcard was
introduced as a possible access key for Health Connect. Research carried out before the launch clearly
showed that customers were interested in the future possibilities presented by the card. In particular
customers liked the idea of being able to choose to store emergency contact information on the chip.
The Medicare smartcard is an optional replacement for the standard Medicare card and is used in the
same way to facilitate the claiming process. Customers can also choose to include their photograph on
the chip.
Tasmanian residents whose existing Medicare card was due to expire were invited to register for a
Medicare smartcard. A total of 17,813 invitations were sent during the 2005–06 financial year. As at 30
June 2006, there were 4,397 registrations for the Medicare smartcard.
On 26 April 2006, the Australian Government announced the introduction of a health and social services
access card. The access card will use smartcard technology to improve the access to, and delivery of,
health and social services benefits. It will replace 17 health and social services cards, including the
Medicare smartcard. The access card will be phased in over a two year registration period beginning
in 2008.
Medicare Australia has provided significant input, through learnings gained from the Medicare
smartcard rollout in Tasmania, into the business case for the health and social services access card.
Online Services
Medicare Australia is progressively delivering improved customer access to information and services
via the Internet to provide an additional, efficient way of interacting with Medicare Australia.
The Online Services facility was made available from 1 October 2005. Services available to Australians
from this date included a new registration facility and services for customers to view their Medicare
safety net balance; view their child’s immunization history statement; and view their organ donor
donation decision.
From June 2006 a new suite of services became available for Australians to view and update selected
personal information and request a replacement and/or duplicate Medicare card.
Medicare Australia regularly undertakes market research to identify our customer’s requirements for
adding services to the online channel. These requirements, along with our organization’s priorities, are
incorporated into the online strategic plan.
Medicare Australia’s Online Services is actively promoted through both Medicare branch offices and
the Medicare call centers, along with various media channels.
Promotional material has included:

posters and flyers in Medicare offices

message printed on the back of thermal printed receipts in Medicare offices

articles in weekend newspapers

online advertising and

Good Health TV, an infomercial that screens in selected GP rooms and pharmacies across
Australia.
During the period October 2005 to June 2006, an average of 125 Australians a day registered for Online
Services. As at 30 June 2006, approximately 33,700 Australians had registered for access to Medicare
Australia Online Services.
eTax 2006
From July 2006, tax return lodgers will be able to automatically retrieve their Medicare Financial Tax
Statement through the eTax lodgment process. For those customers who choose to lodge the tax return
electronically and would normally complete the Medical Expenses section of their personal tax return,
this service will remove the need to phone or visit a Medicare office to request their Medicare Financial
Tax Statement. This streamlined process has been made possible through close collaboration between
Medicare Australia and the ATO.
Web services
The Medicare Australia website www.medicareaustralia.gov au had a total of 2.5 million visitors to the
site accessing both information and Online Services. These visits resulted in an overall 99.1 million hits
to the website. There has been a 30 per cent increase in website visitors in the 12 month period of this
report.
In March 2006, Medicare Australia designed and launched a new website www.jca.gov.au for the Job
Capacity Assessment Program on behalf of the DHS. Job Capacity Assessment is part of the
government’s wider Welfare to Work initiative. Medicare Australia also supports the DHS website.
Aged care
The Aged Care Payments function is managed by Medicare Australia on behalf of the DoHA. The
function makes payments to approved aged care providers, to assist them financially in the provision
of quality and cost effective care for frail, older people, and support for their careers.
DoHA is responsible for administering the policy under the Aged Care Act 1997, which provides for the
payment of subsidies and supplements to approved aged care providers.
Transfer of the Aged Care Payments Function
The decision to transfer responsibility of the Aged Care Payments function from DoHA to Medicare
Australia was made by the Prime Minister in May 2005.
On 20 October 2005, Medicare Australia assumed responsibility for the aged care payments function
and all transferring DoHA payments staff (approximately 120 staff) became Medicare Australia
employees.
Full business continuity was maintained throughout the transfer process. Price water house Coopers
was engaged to conduct an independent post- implementation review on the transfer process, which
was completed in May 2006. Their review indicated that the transfer was a resounding success, noting:
‘It is a good example of how to implement the Australian Government’s strategy of separating policy
development from service delivery. It was also consistent with the Uhrig Review’s recommendations
on governance and compliance. Business processes and change management were managed very
well.’
Our responsibilities
Medicare Australia’s role is to provide timely and accurate payments to approved providers for the
provision of aged care to eligible care recipients, with a focus on customer service and administrative
efficiency. On any given day about one in every 100 Australians receives care in a residential care
service or through a community care program.
Medicare Australia administered $3.9 billion worth of aged care payments in 2005–06 to providers
across a range of residential, community, and flexible aged care programs. Our aged care payment
responsibilities include the processing and payment to approved providers of:

residential aged care subsidies and associated supplements for provision of high-level and lowlevel residential care to recipients

residential respite care subsidies and associated supplements for provision of short term high-level
and low-level residential care to provide careers with relief from their caring role

Community Aged Care Package (CACP) subsidies for provision of support to people with low level
complex health needs; and their careers, to enable them to remain at home and

Flexible Aged Care subsidies including:
 extended aged care at home (EACH) subsidies for provision of support to people with highlevel complex health needs, and their careers, to enable them to remain at home
 EACH dementia subsidies for provision of dementia specific support to people with high-level
complex health needs, and their careers, to enable them to remain at home and
 Transition care subsidies for provision of short-term rehabilitation care to recipients after care
in hospital, pending access to longer term care.
Key business results
Since October 2005, we have processed 23,691 residential claims, 8,014 CACP claims and 1,186 of
Flexible Care claims. These represent $3.9 billion in Aged Care Benefits
Key business results for 2005–06
2005–06
Number of residential claims processed
23,691
Number of CACP claims processed
8,014
Flexible care claims:
EACH (including dementia specific EACH)
1,130
Transition care
56
Total flexible care claims processed
1,186
Total claims processed
32,891
Total amount paid
$3.9 billion
Number of Residential Aged Care Services (Aged 2,931
Care Homes)
Number of CACP Services (Facilities providing 1,012
CACPs)
Number of Flexible Care Services (Facilities 227
providing EACH and Transition Care)
Number of
(eBusiness)
active
services
transmitting 27
Website
General information on the Aged Care Payments function is available on our Health Care Providers’
web pages. The Aged Care page provides an overview of Medicare Australia’s role, with sub-menus
and links to downloadable Aged Care forms, and the Aged Care eBusiness website.
Communication
We provide updates on business processes to approved providers through the Payment Essentials
monthly magazine, and to aged care assessment teams (ACATs) through the monthly edition of ACAT
Chat, both coordinated through DoHA.
Aged care eBusiness
Medicare Australia is introducing eBusiness capability to the aged care sector. The eBusiness solution
will seamlessly integrate with the normal operating environment of aged care providers and state
government ACATs, and will enable the aged care sector to replace paper forms-based processing
with electronic data lodgment and real time validation.
The Aged Care eBusiness solution is being developed in collaboration with DoHA, according to the
requirements outlined by aged care providers and their software vendors. An industry working group,
which meets quarterly, has been established for the purpose of capturing these requirements.
Release 1 of the solution, which enabled the electronic lodgment of selected forms, was delivered in
January 2005. Releases 2a was delivered in June 2006, and a business to business channel enabling
aged care providers to seamlessly forward payment information to Medicare Australia via the Internet.
Release 2b will be delivered in August 2006, and will enable the capacity for ACATs to lodge client
records electronically. Release 3, which will provide full claiming functionality, will be available to the
sector in late 2006.
New Payments System Project
The establishment of an aged care New Payment System (NPS) was announced in the 2004–05
Budget, as part of ‘Investing in Australia’s Aged Care – streamlining administration for better care’.
Medicare Australia has been commissioned by DoHA to design, develop and implement the NPS to
replace the existing aged care payment systems. NPS will seamlessly integrate with Medicare
Australia’s eBusiness solution and will enable real time validation and recording of payment data.
NPS is a claims assessing and payment system to facilitate the processing of data from aged care
providers and will be developed in two phases:

design phase
 develop detailed business requirements, business rules, interfaces, detailed costs estimates
and a development schedule and

development and implementation phase
 development, testing and implementation of the NPS.
It is anticipated that the NPS will be implemented in mid-2007.
Health eSignature Authority (HeSA)
On 1 October 2005, the Health eSignature Authority (HeSA) was deregistered as a subsidiary company
of the HIC and incorporated into Medicare Australia as a distinct unit within the Online Customer
Strategy Branch.
HeSA provides electronic registration services for the Australian health sector. Services include:

registration for and distribution of digital keys and certificates

business registration services and

identity validation — both at individual and location levels.
HeSA also undertakes a range of other initiatives that are designed to support the integrity, validity and
usability of all of its registration services, including ongoing consultation with the sector to stay abreast
of changing business needs and
During 2005–06, HeSA maintained a strong customer and business enhancement focus. Key priorities
included:

facilitating the take-up and use of digital certificates across the health sector

anticipating, and effectively responding to, the increasing demand for digital certificates

promoting the seamless integration of public key infrastructure certificates into technical and
business processes and

ensuring that HeSA’s registration processes and associated services are timely and aligned with
the business needs of the health sector.
Take-up of digital certificates continued to increase during 2005–06, with HeSA processing 8,170
registrations for Medicare online claiming and 527 registrations for PBS online, taking the total number
of ‘live’ digital certificates to 19,849 as at 30 June 2006.
Certificates are considered ‘live’ while they remain current in the health sector.
Live digital certificates
As at 30 June 06
Individual certificates issued
8,981
Location certificates issued
10,868
Total certificates issued
19,849
HeSA is continuing to streamline the registration processes for those health care professionals wanting
to do business electronically with Medicare Australia.
Information technology services (ITS)
Information technology now provides a major medium of communication with our consumers, providers,
business partners, all business groups within Medicare Australia and other agencies. From an
Information, Communications and Technology (ICT) perspective, the business operations of Medicare
Australia are today critically dependent on:

secure and responsive information communications and technology

well-defined and administered policies and procedures and

skilled staff that can leverage the technology.
Key achievements
The key achievements of the ITS division includes:

development of a comprehensive ICT strategic plan

electronic re-branding of HIC to Medicare Australia

improved reliability and availability of our information technology systems

transfer of the Aged Care functions to Medicare Australia and transition of Aged Care claims to an
eBusiness delivery channel

rollout of Family Assistance services to 190 Medicare offices nationally

consolidation of multiple data sources into a single Enterprise Data warehouse

extended the hours of operation for Medicare on weekends

improved sourcing and financial management resulting in substantial cost reductions and

Negotiation of large tenders for essential printing services and Medicare and Veterans’ card
production services resulting in improved services at lower costs to Medicare Australia.
ICT strategic plan
The Medicare Australia ICT strategic plan was released in January 2006 and outlines our technology
strategies for the coming three years.
The Medicare Australia plan has three elements to help us achieve our aims. These are:

ICT Business Solutions - how we will partner with other government agencies, particularly those
within DHS, to maintain and develop our business information and infrastructure system portfolios
into the future based on the Medicare Australia Business Plan and priorities

ICT Operational Service Delivery – how we will ensure the ongoing delivery of reliable, cost effective
technology services in daily business operations and

ICT Governance – how we govern and manage the delivery and development of technology in
Medicare Australia and work with business groups and other agencies.
Priority areas reflected in the Information, Communication and Technology (ICT)
Strategic Plan
Our first priority is to ensure that our technical infrastructure is secure, robust and reliable, thereby
assuring high availability for our frontline business groups and confidence in the underpinning
technology and service delivery as we move into an era where our system will need to be available 24
hours a day, seven days a week.
Our next priority is to ensure that our business application portfolio is capable of supporting current
health services as it faces the challenges of expanding online delivery channels and increased
integration across health care agencies.
We have an objective to deliver ICT services at a reduced cost that provides value for money for
Medicare Australia and its stakeholders. To achieve this we will select the best path to achieve our
goals, maximize return on investment, and assure success.
IT Services Division supports Medicare Australia to ‘live within our means’; it assists the business to
deliver outcomes by being more accountable for estimates, operating budgets and overall financial
management.
The ICT strategy and plan is aligned with the Medicare Australia Business Plan and provides a roadmap
that allows delivery of the technology services that support Medicare Australia in achieving its objectives
in a coordinated and consistent approach, one that maximizes return on investment in technology.
What we achieved in 2005–06
ICT Business Solutions — how we service business requirements

Electronic re-branding of HIC to Medicare Australia so that our new identity is consistently presented
to our customers and stakeholders.

Implementation and stabilization of the Business Improvement (BI) program applications as the
program transitioned to business as usual. These assets include:
 IT Enterprise Architecture to support the eBusiness environment based on a Services
Oriented Architecture (SOA) approach
 a consistent Consumer and Provider Directory and management system that will serve as
the basis for future development
 ECLIPSE to support secure eBusiness connections between practices, public and private
billing agents, Medicare and DVA and health funds and
 The piloting of the Medicare smartcard technologies and concepts in Tasmania to leverage
smart technologies and allow completion of transactions at the point of service.

Medicare Australia Online Services (available via Medicare Australia’s website) covering:
 safety net – consumers are able to view their Medicare safety net balances
 organ donor – consumers can check their status on the Organ donor register
 Immunization – customers can request immunization statements for dependent children.

Transfer of the Aged Care functions to Medicare Australia.

Transition of Aged Care claims to an eBusiness delivery channel.

Rollout of Family Assistance services to 190 Medicare offices nationally.

Introduction of eTax so that members of the public can obtain their Medicare tax statement
information electronically, either through the Medicare website or through the ATO eTax system.

Maintenance of the Medicare, PBS and other programs.
ICT Operational Service Delivery – how we manage our service delivery

Addressing the stability, performance and availability of PBS online so that it is positioned to support
improved uptake of the service by pharmacies.

Optimization of production capacity and performance, providing significant cost savings and
capacity to the organization.

Ongoing consolidation and transition of multiple data sources into a single enterprise data
warehouse based on mid-range technology.

Implementation of an ITSD Service Desk to provide a single point of contact for the business to
ITSD.

Extension of the hours of operation for Medicare on weekends.
ICT Governance – how we ensure we are professional, productive and
align with the business needs:

Implementation of improved sourcing and financial management resulting in:
 substantial cost reductions to date in operating expenses providing the basis for ongoing
operational cost management
 improved sourcing arrangements with major suppliers including IBM, Optus, Microsoft and
SAS and
 Alignment of the sourcing strategy with the Commonwealth Procurement Guidelines (CPGs),
which requires greater transparency of sourcing processes. This has resulted in:
 the development of an Annual Procurement Plan– tendering with adequate notice for
complying with Free Trade agreements
 establishment of specific panels and leveraging of DHS panels for procurement with CPG
financial guidelines and
 Gazette of awarded tenders.

Negotiation of large tenders for:
 essential printing services (including options for electronic services such as SMS and email)
and
 Medicare and Veterans’ card production services.
Both negotiations resulted in improved services at lower costs to Medicare Australia.

Implementation of a business demand management process that provides high-level estimates,
detailed quotations and fixed-price costing for new business requirements to allow the business to
priorities requirements based on accurate quotations and estimates.

Establishment of a rigorous project gating process that ensures that all new business requirements
and enhancements are consistent with the Medicare Australia enterprise architecture and have
agreement from the ITSD branch managers.

Introduction of a project based organization structure and philosophy that includes the
establishment of a program office that tracks and reports on the status of all projects in ITSD.

Establishment of an IT operational governance improvement program that is aligned with the
industry standard AS8018/ITIL framework.
This has resulted in:
 the implementation of a Change Calendar to improve the quality of changes to the production
environments
 the development of a framework for defining and monitoring service levels with the business
and
 a framework that will provide the basis for business aligned IT continuity, development of
business focused service levels and improved asset and configuration management.

Improvement of our delivery productivity through consolidation of system delivery tools and a
program of certification of project managers.

Establishment of Centres of Excellence in the areas of
 authentication
 integration
 quality management and
 Data administration.

Implementation of all IBRS Health Check report recommendations

Completion of an independent financial audit of the division with no major audit findings.
Outlook for 2006-07
The division’s targets and areas of focus for 2006-07 are:

living within our means

maximizing opportunities created last year in procuring goods and services using the departmental
procurement guidelines and arrangements

successful continued rollout of online products for medical practitioners, pharmacists, hospitals and
the Australian public

successful completion of the Aged Care project

continued rationalization of various systems and databases to reduce them to an acceptable
number (the consolidation project)

continuation of the data management and quality review (the data warehouse and data quality
projects)

consolidation of information systems and telephony services in order to improve customer service
and to enable a single interface to new initiatives such as the Health and Social Services Access
Card database

the introduction of improved on-line work tools for our Customer Support Officers and

Completion of management plans for pandemic events.
Section 05 Financial Statements
Section 06 Appendices
Appendix A
Appendix A — Reports required by legislation — 1 July 2005 to 30
September 2005
Prior to its transition to Medicare Australia on 1 October 2005, the HIC was subject to the provisions of
the CAC Act. Section 9 of that Act and the Commonwealth Authorities and Companies (Report of
Operations) Orders 2005 set out certain annual reporting requirements for CAC Act bodies, this section
satisfies those requirements for the period from 1 July 2005 to 30 September 2005 (the relevant period).
Enabling legislation
During the relevant period, the HIC was a statutory authority established by the HIC Act.
Responsible Minister
During the relevant period, the responsible Minister was the Minister for Human Services, the Hon Joe
Hockey MP.
Ministerial directions
During the relevant period section 8J of the HIC Act empowered the Minister to give the HIC written
directions. This power was not exercised during the relevant period.
Judicial decisions and reviews
Judicial decisions that had (or may have) significant effects on the operations of Medicare Australia
include:
Ultrarad and Anor v Health Insurance Commission (HIC)
As reported in the 2004–05 Annual Report, on 11 October 2004, Ultrarad Pty Ltd and Queensland XRay Pty Ltd (QXR) filed an application in the Federal Court for the review of a decision made by HIC
(as it then was) to reject a claim for a Medicare benefit in respect of an MRI service rendered to a
patient at Mater Private Hospital, Pimlico, Queensland. The dispute concerned whether or not the MRI
equipment used to render that service was eligible to render Medicare services under the applicable
legislation.
On 20 June 2005, French J of the Federal Court handed down his decision in which he found in favour
of the HIC. French J held that QXR did not have a ‘contract, in writing’ by the date specified in the
legislation, and that, in any event, QXR failed to comply with statutory requirements in relation to the
furnishing of any such contract to the HIC.
Clare v Health Insurance Commission (HIC)
As reported in the 2004–05 Annual Report, on 19 December 2002, Dr Clare and others commenced
proceedings against the HIC in the Federal Court. The proceedings concerned the eligibility of MRI
equipment operated by Dr Clare and others at premises in Bundoora, Victoria.
This matter was settled in September 2005.
Secrecy provisions and privacy legislation
Secrecy provisions
The secrecy provisions are contained in section 130 of the HIA and section 135A of the NHA. These
provisions provide for the confidentiality of information that is obtained by Medicare Australia in the
performance of its functions.
The secrecy provisions make it an offence for a Medicare Australia officer to disclose information about
a person to a third party, unless one of the specified exceptions or release provisions 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 HIA and section 135A(3) of the NHA 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.
Section 135AA of the NHA, and associated guidelines issued by the Privacy Commissioner, regulates
the maintenance and storage of claims information and requires the separation of Medicare and PBS
databases.
Privacy Act
Medicare Australia is subject to the Privacy Act 1988, (Privacy Act) which regulates the way most
Australian Government agencies collect, handle, use and disclose personal information.
We received 25 complaints about the use and disclosure of personal information we hold. Of these
complaints, 10 were found to be unsubstantiated, 15 were substantiated and the appropriate action
was taken. One complaint was originally lodged with the Privacy Commissioner, who referred it to
Medicare Australia for action.
In accordance with the Privacy Act, Medicare Australia submits an annual report to the Privacy
Commissioner (Personal Information Digest) listing the types and use of information we hold.
Ombudsman
Between 1 July 2005 and 30 June 2006, the Commonwealth Ombudsman received 157 complaints
about Medicare Australia. This represents a decrease of 12 per cent from the previous year.
Issues identified by the Commonwealth Ombudsman in 2005–06
Number
Total number of complaints/approaches to the 157
Ombudsman
Number of approaches/complaints investigated 52
by the Ombudsman
Number of approaches/complaints requiring no 103
further investigation
Total number of complaints finalised
155
Occupational Health and Safety Report
Medicare Australia is required under section 74 of the Occupational Health and Safety (Commonwealth
Employment) Act 1991 to provide a report on occupational health and safety activities and statistics on
notifiable accidents, dangerous occurrences, investigations and notices under section 68 that occurred
during the year.
Statutory report under section 74 of the Occupational Health and Safety (Commonwealth Employment)
Act 1991
Action
Number
Deaths that required notice under section 68
0
Accidents that required notice under section 68
6
Dangerous occurrences that required notice 22
under section 68
Investigations conducted under Part 4
5
Tests on plant, substance, or thing in the course 0
of investigations considered
Directions given to Medicare Australia under 0
section 45 (that the workplace etc not be
disturbed)
Notices given to Medicare Australia under section 0
30 (requests from health and safety
representatives)
Notices given to Medicare Australia under section 0
46 (prohibition notice)
Notices given to Medicare Australia under section 1
47 (improvement notice)
Appendix B
Appendix B — Freedom of information
Medicare Australia is a prescribed authority under the FOI Act and is required to publish information
about the way it is organized, its functions and powers, the categories of documents held by Medicare
Australia and how the public can access them. Also included in this report are FOI statistics for the
financial year 2005–06.
Organization, function and powers
Our organization structure chart appears in Section 2 – About Medicare Australia.
A description of Medicare Australia’s functions and powers as required by section 8 of the FOI Act is
detailed in Appendix A.
List of documents held by Medicare Australia
Brochures explaining the Medicare program, the PBS, the Australian Childhood Immunization Register,
the Compensation Recovery Program, the Federal 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 section 9 statement was updated in January 2006 and is also available on the
National Archives of Australia website at www.naa.gov.au. In accordance with section 9 of the FOI Act,
the following types of documents are held by Medicare Australia. These are available subject to the
exemption provisions of the FOI 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 recognition as a specialist or consultation physician

applications for recognition as vocationally registered GP

brochures relating to Medicare Australia operations

committee and tribunal files created as a result of a specific inquiry or hearing

committee and tribunal member appointed papers

computer records relating to all Medicare Australia operations

financial budgetary Documents

internal audit terms of reference, reports and files

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 approval people and pharmaceutical prescribers

MBS item rulings and interpretations

ministerial, Commonwealth ombudsman and general correspondence

ministerial submissions

operational instructions, circulars and directives relating to Medicare, the PBS, Australian Childhood
Immunization Register, PIP, Compensation Management System, 30% Rebate on Private Health
Insurance, Veterans’ Treatment Accounts, Australian Organ Donor Register, Hearing Service
Payment and Health Research and Coordinated Care Trials

personal records

processed enrolment, registration, 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 Centre and
Accredited Pathology Laboratories

records of contact between medical advisers and medical practitioners

statistical reports and analyses and

undertakings for participating optometrists.
Procedures and initial contact points
A formal request under the FOI Act for 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
Telephone: (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
2005–06.
Reportable Freedom of Information Statistics 2005–06
Requests
No of or $ Amount
On hand 30 June 2005
1
Received
19
Resolved by being:
Requests
No of or $ Amount
Withdrawn (following consultation)
0
Granted in full
0
Granted in part
15
Denied in full
4
Outstanding at 30 June 2006
1
Finalised in:
0-30 days
13
31-60 days
6
61-90 days
0
91 days or more
0
Fees and levies charged
Application fees received
$550.00
Charges notified
$1706.90
Charges collected
$1161.90
Internal reviews
Received
4
Finalised
4
Administrative Appeals Tribunal Appeals
Received
0
Outstanding at 30 June 2006
0
Freedom of Information standards
Standard
Performance 2004–05
Performance 2005–06
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.
One request was carried over
and 21 requests were received
in 2004–05. Of these, 18
decisions were made, three
were withdrawn and one was
carried through to 2005–06. All
were acknowledged within 14
days of receipt. Of 18 decisions,
18 were responded to within the
legislated timeframes.
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, 19 were responded
to
within
the
legislative
timeframes.
Appendix C
Appendix C — Staffing
Staffing statistics
Medicare Australia has staff located across Australia, in the national office in Canberra, state
headquarters in each state, nine payment processing and call centres and 238 community-based
Medicare offices. As at 30 June 2006, 5,393 staffs were employed by Medicare Australia under the
Public Service Act 1999.
This reflects an increase of 222 staff or 4.2 per cent since 30 June 2005. Increases have occurred in
state networks and are aligned to Family Assistance business growth. Part-time work participation has
remained constant and applies to 20 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 as at 30 June 2006.
Staff employed by classification and location
Classification
National Office
NSW
QLD
SA
TAS
VIC
WA
Total
CEO
1
0
0
0
0
0
0
1
SES Band 3
2
0
0
0
0
0
0
2
SES Band 2
5
1
0
0
0
0
0
7
SES Band 1
29
0
1
1
1
0
1
33
EL 2*
218
5
4
1
2
4
0
234
EL 1**
381
12
6
12
13
4
6
434
APS 6
274
26
18
12
3
21
9
363
APS 5
158
170
125
50
27
126
53
709
Classification
National Office
NSW
QLD
SA
TAS
VIC
WA
Total
APS 4
94
64
38
21
13
61
22
313
APS 3
85
660
390
169
88
475
176
2,043
APS 2
6
161
121
41
23
144
69
565
APS 1
2
182
133
60
60
191
61
689
Total
1,255
1,281
836
367
230
1,027
397
5,393
* Executive level 2
** Executive level 1
Ongoing and non-ongoing staffing by classification
Classification
Non-ongoing
Ongoing
Total
CEO
0
1
1
SES Band 3
0
2
2
SES Band 2
0
7
7
SES Band 1
0
33
33
Snr 1
233
234
EL 1
8
426
434
APS 6
14
349
363
APS 5
21
688
709
APS 4
19
294
313
APS 3
36
2.007
2,043
APS 2
22
543
565
APS 1
167
522
689
Total
288
5,105
5,393
EL 2 including
Medical Officers
Full-time, Part-time staffing by classification
Classification
Non-ongoing
Ongoing
Total
CEO
1
0
1
SES Band 3
2
0
2
SES Band 2
7
0
7
SES Band 1
33
0
33
EL 2
218
16
234
EL 1
397
37
434
APS 6
342
21
363
APS 5
682
27
709
APS 4
296
17
313
APS 3
1,421
622
2,043
APS 2
390
175
565
APS 1
519
170
689
Total
4,308
1,085
5,393
Staff employed by gender and location
State
Female
Male
Total
National Office
701
554
1,255
NSW
1,135
146
1,281
QLD
728
108
836
SA
316
51
367
TAS
200
30
230
VIC
899
128
1,027
WA
345
52
397
Total
4,324
1,069
5,393
Salary ranges for staff covered by the Certified Agreement and AWA’s
Classification
Salary Range $
SES Band 3
(a)
SES Band 2
145,600 - 158,000
SES Band 1
110,210 - 138,545
EL 2
81,581- 131,000
EL 1
70,771 - 90,720
APS Level 6
56,700 - 79,870
APS Level 5
52,828 - 59,748
APS Level 4
47,387 - 51,224
APS Level 3
41,206 - 44,472
APS Level 2
37,173 - 40,117
APS Level 1
19,822 - 36,190
(a) SES Band 3 salaries have not been included, as they will enable identification of individual
employees’ packages because of the small number of officers at that level.
All SES employees are entitled to the use of private-plated vehicles or cash-out arrangements.
Performance pay
Staff Groups
Staff Paid
Amount Paid
Average
Range
Senior Executives (incl CEO)
41
$269,281.33
$6,567.84
$570.00– $16,804.00
Executive Level 2
163
$672,562.37
$4,126.15
$869.00– $9,900.00
Executive Level 1 and below
97
$356,509.00
$3,675.35
$210.00– $8,723.00
Total
301
$1,298,352.70
$4,313.46
Indigenous
Disability
Equity and Diversity Groups
NESB
Location
Ongoing
Nonongoing
Ongoing
Nonongoing
Ongoing
Nonongoing
National Office
2
4
30
0
223
8
NSW
6
1
27
0
336
5
QLD
14
2
16
1
40
0
Indigenous
Disability
NESB
Location
Ongoing
Nonongoing
Ongoing
Nonongoing
Ongoing
Nonongoing
SA
6
1
8
3
38
3
TAS
5
0
5
2
5
3
VIC
10
0
30
1
165
8
WA
3
0
4
0
43
2
Total
46
8
120
7
850
29
NESB – Non-English speaking background
Appendix D
Appendix D — Consultancy services
The following table lists new and extended consultancy contracts let to the value of $10,000 or more
(inclusive of GST) during 2005–06. Included is 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 for each individual consultancy.
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 specialised or professional skills
C. need for independent research of assessment
Consultancy services provided to Medicare Australia in 2005–06
Company Name
Purpose of engagement
Beames & Associates
Process
Reason
Review of hard close of the 30,000.00
Annual Financial Statement
process
3
c
Booz Allen Hamilton
Review of the transfer of 265,000.00
Aged Care functions
4
a/c
Booz Allen Hamilton
Benchmark the deployment 193,000.00
of PBS online to pharmacies
4
a/c
Computer Associates
Stakeholder
Management 80,000.00
System Project
2
a
Ernst & Young
Develop a communication 22,197.13
strategy and material for use
by the Business Pricing
Section
3
a/c
Ernst & Young
Development
Control Plan
4
a/c
Excelerated Consulting
Enhancements to budget 19,362.75
management system (BMS)
3
a/b
HBA Consulting
Provide specialist IR advice 23,870.00
and representation
3
a
HBA Consulting
Review of Senior Executive 16,060.00
Positions
3
b
37,246.80
3
B
Lockstep Consulting Pty Ltd
Consultancy services for the 73,556.31
implementation of Known
Customer Certificates
1
b
Lockstep Consulting Pty Ltd
Advice on
overseas
trends 22,840.96
3
b
Price Waterhouse Coopers
Define
opportunities
to 75,000.00
transition
ownership
of
ECLIPSE to the private
sector
4
a/c
of
Intelligent
Business ITSD Health Check
Research Service
PKI
Price ($)
Fraud 204,361.05
Company Name
Purpose of engagement
Protiviti Pty Ltd
Price ($)
Process
Reason
Develop a plan for financial 72,879.00
framework
3
a/c
SAP Australia
Roadmap
Assessment
Upgrade 79,750.00
1
a/c
SEM Australia Pty Ltd
Development of Medicare 81,851.00
Australia’s Activity Based
Management Model
2
a/b
Stratsec.Net Pty Ltd
Security
consultation
to 22,748.00
scope the handling of InConfidence documents
2
a
Stratsec.Net Pty Ltd
I-RAP Certification
1
b
13,516.80
The
Boston
Group Pty Ltd
Consulting Review of Medicare Claiming 328,000.00
Financial Analysis Project
4
a/c
The
Boston
Group Pty Ltd
Consulting Development
of
Family 354,000.00
Assistance Office Funding
Transfer Model
4
a/c
The
Boston
Group Pty Ltd
Consulting Business Transition Strategy
4
a/c
1,035,000.00
Uncommon Knowledge
Advice on Indigenous Access 20,659.65
3
a
Uncommon Knowledge
Indigenous Market Research
3
B
URBIS
Social
Consultancy
1
b
Walter Turnbull
Review
of
Financial 28,457.00
Management Function
2
B
28,710.00
Research 351,933.45
$3,479,999.90
Appendix E
Appendix E — Service Charter
Medicare Australia is one of Australia’s largest service delivery organisations and provides some form
of benefit to almost every Australian. Our service charter outlines our obligations and standards of
service as well as the benchmarks we use to measure our performance. It also advises what our
stakeholders can do to assist us, as well as providing details of our complaints handling processes and
how to access our services.
The information in the following tables outlines our service standards and performances for the following
services:

claims processing and payments of benefits to the public and to medical providers

telephone enquiries and

Medicare office counter enquires.
Claims processing and payment standards for the public
Service
Service standard
Performance 2004–05
Medicare—for claims Paid accounts will be 100%
reimbursed by cash on
lodged manually
the day at a Medicare
office
(daily
limits
apply).
Performance 2005–06
100%
Paid accounts will be 98%
reimbursed
by
electronic
funds
transfer (EFT) to your
nominated account (not
available for passbook
accounts) or by cheque
posted to you 10 days
after lodgement.
99%
Claims
for
unpaid 99%
general
practitioner
(GP) accounts will be
reimbursed by cheque
made out to the doctor.
The cheque will be
posted to you 16 days
after lodgement.
98%
Claims for other unpaid 98%
medical
provider
accounts
will
be
reimbursed by cheque
made out to the
provider. The cheque
will be posted to you 18
days after lodgement.
99%
Medicare—for claims Paid accounts will be 99%
lodged
electronically reimbursed by EFT to
your
nominated
95%
Service
Service standard
Performance 2004–05
Performance 2005–06
(including via a doctor’s account if requested
(not
available
for
practice)
passbook accounts) or
by cheque posted to
you 10 days after
lodgement.
Medicare—
compensation
Claims for unpaid GP 99%
accounts
will
be
reimbursed by cheque
made out to the doctor
and sent to you 14 days
after lodgement.
99%
Claims for other unpaid 100%
medical
provider
accounts
will
be
reimbursed by cheque
made out to the
provider. The cheque
will be posted to you 15
days after lodgement.
99%
A Medicare history 98%
statement
will
be
processed within 28
days of a request for a
Notice of Past Benefits.
97%
A Notice of Past 97%
Benefits
will
be
processed with 28 days
of
receipt
of
an
accepted
Medicare
claims
history
statement.
97%
On receipt of an 98%
accepted
Medicare
claims
history
statement,
refunds
from
an
advance
payment will be made
within three months of
us receiving both the
notice of judgement or
settlement and the
98%
Service
Service standard
advance
amount.
Medicare—for
billing
Performance 2004–05
Performance 2005–06
payment
bulk Manual bulk bill claims 98%
for all services except
pathology and GP
services
will
be
reimbursed to providers
by cheque 15 days
after lodgement.
99%
Manual GP claims will 96%
be
reimbursed
to
providers by cheque 14
days after lodgement.
98%
Manual
pathology 99%
claims
will
be
reimbursed to providers
by cheque 28 days
after lodgement.
99%
Electronically lodged 91%
claims for all services
except pathology will
be
reimbursed
to
providers by cheque or
EFT eight days after
lodgement.
94%
Electronically lodged 99%
pathology claims will be
reimbursed to providers
by cheque or EFT 28
days after lodgement.
99%
Australian Childhood Australian Childhood 100%
Immunisation Register Immunisation Register
notification payments
will be made by EFT,
and a statement mailed
to providers, within
seven days of the end
of each month.
100%
Service
Service standard
Performance 2004–05
General
Practice A General Practice 100% statements
Immunisation
Immunisation
Incentives
outcomes
Incentives
payment calculation will
be run quarterly in
February, May, August
and November of each
year.
All payments will be 100% payments
made and statements
sent within two weeks
of
the
quarterly
calculations.
Service
payments
Practice
payments
incentive Service
incentive 100%
payments will be made
within five days of the
end of each month.
Performance 2005–06
100% statements
100% payments
100%
Incentives A Practice Incentives 50% statements
Program payment will
be run quarterly in
February, May, August
and November of each
year.
50% statements
All payments will be 100% payments
made and statements
sent within two weeks
of
the
quarterly
calculations.
100% payments
Pharmaceutical
Benefits Scheme
When
correct
documentation
is
provided:

cash payments for 100%
claimants of patient
refunds
will
be
processed on the
day at a Medicare
office (daily cash
limits apply)
100%
Service
Service standard

Veterans’
Accounts
Performance 2004–05
Performance 2005–06
cheque payments 92%
for eligible patient
refunds
will
be
issued within 28
days of lodgments
94.6%
97%
99.1%

Claims
Transmission
System
benefits
claims will be paid to
the pharmacy within
17 days

written
authority 100%
approvals will be
provided
within
three working days
from the date of
receipt
99.6%

Prescription
pad 100%
orders
will
be
dispatched
within
four
weeks
of
receipt.
100%
Treatment 90% of Medical claims 99%
will be reimbursed to
medical
practitioners
within 28 days
100%
90% of hospital claims 99%
will be reimbursed to
hospitals within 28
days, unless otherwise
contracted
100%
90% of ancillary service 99%
claims
will
be
reimbursed to providers
within 28 days, unless
otherwise contracted
100%
Percentage of telephone enquiries answered by an operator within 30 seconds (average across
Australia)
Enquiry line
Australian
Register
Performance 2004–05
Organ
Performance 2005–06
Donor 94%
98%
Australian
Childhood 92%
Immunisation Register enquiry
line and reports
87%
Australian
Childhood 94%
Immunisation Register Internet
enquiry line
97%
Compensation
95%
93%
Department of Veterans’ Affairs 98%
— allied services
99%
Department of Veterans’ Affairs 99%
— hospital services
99%
Department of Veterans’ Affairs 99%
— medical services
99%
Med claims
92%
92%
Improved Medicare Entitlement 92%
Program
93%
Medicare Australia Access 92%
Points (previously known as
Easy claim)
96%
Medicare provider enquiries
94%
90%
Medicare public enquiries
91%
88%
Optometrist C T-F
93%
94%
PBS authority approvals
89%
93%
PBS general enquiries
95%
91%
PIP payments
99%
99%
Simplified billing
93%
91%
Enquiry line
Performance 2004–05
Performance 2005–06
Telephone claiming
94%
90%
Source: Performance Measurement Framework Service level and call volumes summary.
Medicare offices counter enquiry standards
Standard
Performance 2004–05 a
Performance 2005–06 b
We aim to keep waiting times 98.77% of customers were 98.6% of customers were
below 10 minutes
served in under 10 minutes
served in under 10 minutes
a
Based on 31,176 observations conducted in Medicare offices during 2004–05
b
Based on 79,335 observations conducted in Medicare offices during 2005–06
Customer feedback, as recorded in our customer feedback register
Feedback type
Volume 2004–05
Volume 2005–06
Suggestions
63
109
Compliments
289
417
Complaints
469
786
Correspondence b
13,542
14,233
We will respond to you as
quickly as possible within 28
days. If we cannot meet the 28day standard, within 14 days of
receiving your query we will
advise you of an expected reply
date, and who to contact in the
meantime.
a
A complaint is entered onto the customer feedback register only if it is not satisfactorily resolved by
either the staff member initially contacted by the customer or the staff member’s supervisor.
b
We report on correspondence received and entered into the customer feedback register. However,
this does not represent the total correspondence handled by Medicare Australia and does not include
professional registrations, objections and decisions.
Appendix F — Advertising and market research
Section 311A of the Commonwealth Electoral Act 1918 requires Australian Government agencies to
report all payments of $1,500 or more made to advertising agencies or to organizations carrying out
market research, polling, direct mailing or media advertising. The following table outlines the use of
such agencies by Medicare Australia in 2005–06
Payee
Purpose
Amount
AC Nielsen Research Pty Ltd
Face of Medicare study
$29,700.00
Worthington Di Marzio Pty Ltd
PBS
restricted
medicines $81,120.41
awareness and compliance
Cultural Partners
Evaluation
research
Overseas Drug Diversion
Market Research
on $38,500.00
Wendy Bloom & Associates Pty EFTPOS and online services $122,578.84
Ltd
research
Centrelink-FM&S
service
shared PC1 claim form research
$4,000.00
Uncommon Knowledge
Customer
service
and $177,593.35
Indigenous access research
Roy Morgan Research Pty Ltd
Customer satisfaction research
$73,445.68
Measured Insights
2006 Staff survey
$116,796.20
Colmar
Research
Brunton
Social Customer
survey,
system testing
Carol Davis and Associates
queue $58,952.00
Consumer research reports
$25,080.00
Polling
No polling undertaking during period
Media advertising
HMA Blaze Pty Ltd
To
conduct
recruitment $457,175.18
advertising and standard noncampaign Medicare Australia
advertising
Universal McCann
Media Advertising
Cultural Perspectives Pty Ltd
Overseas
Drug
Diversion $46,970.00
Program advertising
$14,871.09
Direct mail
National Mailing and Marketing
Forum newsletter mailed out to $40,664.64
Doctors*
National Mailing and Marketing
Bulletin Board newsletter mailed $3,512.15
out to pharmacists*
DUCOR Group
PBS Safety Net Kits
$60,877.00
DUCOR Group
PBS Doctors bag order books
$61,582.00
Australia Mailing
Letterbox drop of postcards for $2,311.10
new Medicare Office openings*
* Postage costs not included
Appendix G — Contact details
Office locations
National Office
134 Reed Street North
Greenway ACT 2900
Phone: (02) 6124 6333
Fax: (02) 6282 5025
Postal address:
PO Box 1001
TUGGERANONG DC ACT 2901
State offices
New South Wales
Tasmania
130 George Street
242 Liverpool Street
Parramatta NSW 2150
Hobart TAS 7000
Phone: (02) 9895 3333
Phone: (03) 6125 5333
Fax: (02) 9895 3082
Fax: (03) 6125 5700
Queensland
Victoria
444 Queen Street
460 Bourke Street
Brisbane QLD 4000
Melbourne VIC 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 SA 5063
108 St Georges Terrace
Phone: (08) 8274 9333
Perth WA 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 below. Calls to 1300 numbers cost 25 cents from anywhere within Australia and calls
to 1800 numbers are free of charge. Calls from public pay phones or mobile phones may be charged
at higher rates. Further information can be found on Medicare Australia’s website at
www.medicareaustralia.gov.au
Alternatively, people can contact Medicare Australia about a range of matters through the Internet,
using the email addresses listed by subject area below.
Enquiry lines open 24 hours every day
Australian Childhood Immunisation
enquiry line and reports
Register 1800 653 809
Australian Childhood
Internet enquiry line
Register 1300 650 039
Immunisation
Australian Organ Donor Register
1800 777 203
Australian Organ Donor Register (Approved 1800 556 455
Medical Practitioner)
Customs Prescription Drug Smuggling
General Practice
Scheme enquiries
Immunisation
1800 032 258
Incentives 1800 246 101
PBS authority approvals
1800 888 333
Prescription Shopping Information Service
1800 631 181
Public key infrastructure customer service centre 1300 660 035
Telephone claiming
Enquiry lines open during business hours
1300 360 460
Aboriginal and Torres Strait Islander access line
1800 556 955
Bali special health care benefits hotline
1800 660 026
Compensation
13 21 27
Complaints and feedback line
1800 465 717
Department of Veterans’ Affairs—allied services
1300 550 051
Department
services
of
Veterans’
Affairs—hospital 1300 551 002
Department
services
of
Veterans’
Affairs—medical 1300 550 017
The 30% Rebate on Private Health Insurance
13 62 21
Fraud hotline
1800 202 101
Medicare Australia online claiming
1800 700 199
Improved monitoring of entitlements
1300 302 122
Med claims
1300 788 008
Medical advisory line
1800 800 314
Medicare provider enquiries
13 21 50
Medicare public enquiries
13 20 11
National electronic data interchange help desk
1300 550 115
Opt metrical IVR date-of-service check
1300 652 752
PBS general enquiries
13 22 90
PIP payments
1800 222 032
Rural Retention Program
1800 010 550
Simplified billing
1300 130 043
Source-based audit
1800 675 235
Travelling with PBS Medicine enquiry line
1800 020 613
TTY (Telephone Typewriter for the hearing 1800 552 152
impaired)
Email addresses for enquiries
Australian Childhood Immunisation
acir@medicareaustralia.gov.au
Register
Australian Organ Donor Register
aodr@medicareaustralia.gov.au
Compensation
medicare@medicareaustralia.gov.au
Feedback reporting facility for providers
provider.feedback@medicareaustralia.gov.au
and specialists
General Practice Immunisation Incentives
gpii@medicareaustralia.gov.au
Scheme
GPMOU 90-day scheme
90daypay@medicareaustralia.gov.au
Goods and services tax (GST)
gst.enquiries@medicareaustralia.gov.au
Medicare Australia general enquiries
medicareaustralia.info@medicareaustralia.gov.au
Medicare Australia online claiming
medicareaustralia.online@medicareaustralia.gov.au
Medicare Australia Media
info@medicareaustralia.gov.au
Communications and Government
Medicare Australia public key
pki@medicareaustralia.gov.au
Infrastructure
Medicare Australia’s service charter
service.charter@medicareaustralia.gov.au
Medicare Australia’s statistics
medicareaustraliastats@medicareaustralia.gov.au
IBNR Indemnity Claims Scheme
medical.indemnity.payments@medicareaustralia.gov.au
Medicare provider enquiries
medicare.prov@medicareaustralia.gov.au
Medicare public enquiries
medicare@medicareaustralia.gov.au
Pathology
pathology.section@medicareaustralia.gov.au
PBS
pbs@medicareaustralia.gov.au
PIP
pip@medicareaustralia.gov.au
PSS
pss@medicareaustralia.gov.au
PRD
professional.review@medicareaustralia.gov.au
ROCS Support Payments
rcssp@medicareaustralia.gov.au
ROCS Support Payments
rcssp@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 account management
sam@medicareaustralia.gov.au
Software vendor account management
sam@medicareaustralia.gov.au
Software vendor help desk
edihelp@medicareaustralia.gov.au
Software vendor liaison
edi.liaison@medicareaustralia.gov.au
UMPS Payment
umpsp@medicareaustralia.gov.au
Victorian EDI helpdesk
vicedi@medicareaustralia.gov.au
Glossary and acronyms
Glossary
Service
Generally used to describe a medical service of an individual item number listed
under the Medicare Benefits Schedule or individual prescription medicine listed
under the Pharmaceutical Benefits Scheme.
Transaction
The act of processing a medical service for rebate, updating patient details,
generating an online tax statement, or processing PBS scripts etc. The processor
performs a series of actions, including such things as data entering and data
checking, which in total completes the transaction.
Claim
A statement lodged by a customer or provider relating to a supplied service or
multiple services where the expectation is that they will receive a benefit. The way
the claim is lodged defines 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.
Benefit
The amount of rebate paid to a patient or provider for a service.
Out-of-hospital
Refers to 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 doctors’ charge.
Gap amount
The difference between the Medicare benefit and the schedule fee.
Schedule fee
A fee for a service that is set by the government.
Payment
Payment of a benefit, incentive or allowance.
Acronyms
AAT
Administrative Appeals Tribunal
ACAT
aged care assessment team
ACRRM
Australian College of Rural and Remote Medicine
ANAO
Australian National Audit Office
APS
Australian Public Service
ARAS
Audit and Risk Assurance Services
ATO
Australian Tax Office
CDPP
Commonwealth Director of Public Prosecutions
CSO
customer service officer
DIMA
Department of Immigration and Multicultural Affairs
DHS
Department of Human Services
DoFA
Department of Finance and Administration
DoHA
Department of Health and Ageing
DoHWA
Department of Health Western Australia
DVA
Department of Veterans’ Affairs
ECLIPSE
Electronic Claim Lodgment and Information Processing Environment
FaCSIA
Department of Family, Community Services and Indigenous Affairs
FAO
Family Assistance Office
FOI Act
Freedom of Information Act 1982
FTB
Family Tax Benefit
GP
general practitioner
HECS
Higher Education Contribution Scheme
HeSA
Health eSignature Authority Pty Ltd
HIA
Health Insurance Act 1973
HIC
Health Insurance Commission
HIC Act
Health Insurance Commission Act 1973
HOSC Act
Health and Other Services (Compensation) Act 1995
IAP
Indigenous Access Program
IBNR
Incurred But Not Reported
MBS
Medicare Benefits Schedule
MDO
medical defense organization
MPRC
Medicare Participation Review Committee
NHA
National Health Act 1953
PBS
Pharmaceutical Benefits Scheme
PIP
Practice Incentives Program
PRD
Program Review Division
PSS
Premium Support Scheme
RACGP
Royal Australian College of General Practitioners
ROCS
Run-off Cover Scheme
ROCSSP
Run-off Cover Scheme Support Payment
RPBS
Repatriation Pharmaceutical Benefits Scheme
RRP
Rural Retention Program
SES
senior executive staff
THA
Tsunami Healthcare Assistance
UMP
United Medical Protection
UMPSP
United Medical Protection Support Payment