Doctors Forced to Repay Medicare PBS Benefits

Female doctor holding a clipboard and stethoscope on her person

The Professional Services Review (PSR) Scheme was established in 1994 in part to protect the Australian Commonwealth from having to meet the costs of either medical or health services provided through inappropriate practice.

The Professional Services Review – sometimes referred to as the Medicare ‘watchdog’ – is responsible for reviewing and examining potential inappropriate practice by doctors in relation to providing Medicare services or prescribing Government subsidised medicines under the Pharmaceutical Benefits Scheme (PBS).


In its latest report, the PSR shows that doctors and other health practitioners were forced to repay more than $4.5m in health benefits to the Commonwealth over the past year.

This included 17 GPs across four states who admitted to engaging in inappropriate practice and subsequently had to repay a combined total of more than $1.6m. Another seven practitioners repaid a combined total of just under $3m in Medicare PBS claims.

The report states that in the cases reviewed – poor clinical notes, failure to comply with the particular requirements of the Medicare PBS items billed, or unacceptably high numbers of service provision led to the above repayments.

Other considerations used by the PSR to determine inappropriate practice include whether services were medically necessary and clinically relevant.

In addition to repayment orders, resolutions for inappropriately prescribing Pharmaceutical Benefits Scheme or Medicare-subsidised services can include reprimands, counselling and partial or full disqualification from claiming future subsidies for a period of time.

The PSR, which has greater investigative powers and includes a peer review process by a committee, is also designed to protect patients and in cases of serious breaches of patient care the PSR may refer doctors to the appropriate medical board.

Reviewed cases may result in decisions to take no further action if there is a finding of no inappropriate practice by the PSR committee.

The PSR has been dealing with an increase in referrals from Medicare, up from 62 in 2014/15 to 80 in 2015/16.

A shift from small independent surgeries to larger corporate medical practices is thought to be part of the reason behind the increased number of referrals, however the 80 cases referred last financial year represent less than 0.1% of the 85,000 health practitioners who received Medicare-subsidised payments during the year.

To ensure that taxpayers are not footing the bill for unacceptable medical practice and misuse of the Pharmaceutical Benefits Scheme, the Department of Health operates a comprehensive compliance program and provides education and information support tools to assist practitioners to ensure the payment of benefits is made correctly.

More information on these products and initiatives can be found on the Department of Health’s website.