ABC Radio Canberra PM Interview with Dr Rachel David and Dr Kathryn Flynn on private health insurance fraud

Station: ABC Radio Canberra
Program: PM
Date: 25/7/2017
Time: 6:37 PM
Compere: Matt Wordsworth
Interviewee: Dr Rachel David, CEO, Private Healthcare Australia and Dr Kathryn Flynn, University of Wollongong


REPORTER: Dr Flynn studies fraud against health systems, and says it’s no surprise it’s a problem.
DR KATHRYN FLYNN: Well the biggest loophole is a shear size of the system and the number of claims that are made every year.
REPORTER: Dr Rachel David, the CEO of Private Healthcare Australia, agrees, but says the problem is no different to other big payment systems.
DR RACHEL DAVID: … Including Government payment systems like Social Security and Medicare. And it just needs proper vigilance by looking at the data and making sure that you quickly address outliers and people that you detect are not doing the right thing.
REPORTER: Both point out that the majority of fraud is done by people who know the system: from the customer, to doctors, dentists, medical receptionists, and even computer hackers.
Rachel David again.
DR RACHEL DAVID: Certainly something could’ve been picked up in the past that a well-known health practitioner to bill for more services that’s possible to actually do in a 24 hour period.
REPORTER: But it’s when the fraud is conducted specifically by the customer that another potential loophole appears, according to Dr Kathryn Flynn.
DR KATHRYN FLYNN: A customer takes out membership, defrauds a fund, cancels the membership, moves onto another fund, defrauds it too, repeats this behaviour until they’ve done all the rounds of all the funds. Then they come back to the first fund and take out membership as a new member, but this time with a disguised identity. The funds argue that privacy legislation actually facilities this type of fraud, and the funds says they’re not allowed by the Privacy Act to disclose such fraudulent behaviour to other funds.
REPORTER: But Rachel David doesn’t think the privacy legislation is quite this problematic for the industry.
DR RACHEL DAVID: There are occasions when a health fund does pick up on an issue like Medicare fraud before the Government. In those situations, we absolutely do advise the appropriate authorities. In some cases, the privacy legislation and competition policy does restrict the sharing of information, but in almost all cases it is possible to detect and address fraud within the law. And we’re always talking to regulators about ways in which we can make that process more efficient.
MATT WORDSWORTH: Dr Rachel David, the CEO of Private Healthcare Australia, ending Katherine Gregory’s report.
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