According to documents obtained by the ABC under Freedom of Information laws, some Australian pathology companies engaged in fraudulent practices during the COVID-19 pandemic. The documents revealed widespread and “systematic rorting” by these companies, including accusations of fraud, cost-shifting, and opportunistic claiming. One doctor even requested 21,000 tests in a single day, in violation of the rule that each case must be clinically assessed individually. The reports also showed that pathology companies were operating state-funded testing clinics but billing the federal government’s Medicare scheme instead. These actions amounted to a cost-shift to the Commonwealth.
The documents raised concerns about the lack of valid referrals from doctors or nurse practitioners for testing and highlighted instances of co-claiming for other viral tests, such as influenza and RSV, which should not have been covered under Medicare. Health economist Professor Stephen Duckett described the situation as “systematic rorting on a very large scale” and questioned the overall funding arrangements for pathology in the country.
In response to the findings, Australian Pathology, the peak body representing pathology companies, stated that its members are subject to routine compliance audits and denied any evidence of rorting. They emphasized that there were multiple checks and balances in place and defended the practice of testing patients without referrals, citing the public health messaging to get tested if experiencing symptoms or exposure.
The Department of Health and Aged Care reportedly received 47 tips about potential fraud in COVID testing during the pandemic. However, a spokesman for the department stated that these tips only accounted for about 1% of the overall tips received during that time. The department sent warning letters to several pathologists and pathology companies regarding compliance issues, but Professor Duckett criticized the lack of enforcement and called for a major investigation.
While the exact amount of money lost due to non-compliance is unknown, it is estimated that even if just 1% of claims were fraudulent, it would amount to $23 million. The bulk-billing rate for a private pathology COVID test was $72.25, and the doctor who claimed 21,000 tests would have taken $1.5 million from Medicare alone.
These revelations come as the pathology industry is negotiating with the federal government to end a 24-year freeze on Medicare fees for tests. The industry has launched a campaign called “Keep Pathology Free” and has made significant donations to both major political parties.
Overall, the documents highlight the need for stricter enforcement and oversight in the pathology industry to prevent fraudulent practices and ensure appropriate use of government funds.
