The Medicare Professional Services Review (“PSR”) process

January 25, 2017


One potential result of a review by Medicare under its Practitioner Review Program is referral to the Director Professional Services Review (“the Director”).  Medicare is concerned with the statistical landscape of your practice and whether it deviates significantly from that of your peers in terms of your billing of particular items under the MBS.  The Director is independent of Medicare.  Unlike Medicare, he is more interested in whether there has been appropriate clinical input.

If you are referred for review by the Director, it is imperative that you seek advice from your medical defence organisation (MDO).  There are potentially serious ramifications which may follow review by the Director, including a hearing by a PSR Committee, a requirement to repay benefits, and disqualification from billing Medicare for particular items or being fully disqualified.

If you are referred to the Director, his first step will be to request a small sample of your clinical records during a twelve‑month period (called the review period) in respect of patients whom you have billed an MBS item of concern to Medicare.  The Director (or one of his consultants) will review the records to ascertain whether they meet the MBS descriptor for the item.

When the Director has conducted his review, he will arrange to visit your practice to discuss the concerns.  It is important to have a lawyer or a representative from your MDO attend the meeting to advise you and guide you through this interview.  The impressions gained by the Director during the visit can be very important in the resolution of the matter.

The Director will then provide a Director’s Report, setting out his concerns, the matters discussed and the practitioner’s response.  The Director will invite a submission with regard to the action he should take.  The actions available to the Director are:

  • To take no further action.
  • To enter into an Agreement to resolve the matter.
  • To refer you to a PSR Committee for peer review of a random selection of the services for the MBS items of concern.

If the matter is resolved by way of an Agreement, it generally involves a repayment of a proportion of the medical practitioner’s MBS billings for the items of concern.  It may also involve a disqualification from billing certain MBS items.  The amount of a repayment and the period of disqualification depend upon the Director’s assessments of inappropriate practice.  Repayments range in size from relatively small amounts to hundreds of thousands of dollars.  Disqualifications generally are for periods of three to six months.

If you are disqualified from billing MBS services, you have an obligation to notify AHPRA of this within seven days.

It is important at all times to seek advice from Ball+Partners and your medical defence organisation regarding this process.


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