Auditor praises Medicare IT accuracy

Legacy systems and processes still up to the task

The IT operations of Medicare Australia (MA) has been given the thumbs up by the Australian National Audit Office (ANAO), which found it is capable of processing nearly 99 percent of claims automatically despite keeping older technology and a design limitation with the processing system which can result in some information supporting a claim decision being lost.

An agency of the Department of Human Services, MA is responsible for the delivery of Medicare, a welfare fund that subsidizes medical and hospital services to the tune of nearly $12 billion a year.

With more than 21 million people enrolled in Medicare and some 257 million claims made annually, the MA claims processing system is one of the highest volume transaction systems in Australia.

In an investigation into the accuracy of Medicare claims processing, the ANAO found MA has expanded the range of claiming and payment methods (channels), and, to achieve this, the agency has been a "relatively early adopter of emerging technologies and, as a result, has a dynamic IT environment".

An early adopter perhaps, but the audit office found the introduction of new systems to support additional claiming and payment methods has "often required the retrofitting of, and/or integration with, the existing older systems".

Newer IT systems have been introduced into MA's environment to cater for more diverse service delivery; however, the actual assessment of a claim, irrespective of how the claim was submitted or how the payment is to be made, is undertaken using a common mainframe-based processing system.

Computer aided audit techniques were used to assess the accuracy of a sample of the Medicare claims processed in a two-week period involving some 6.5 million claimed items with the focus on the mainframe-based system.

The audit concluded that the design of the mainframe-based processing system, and of the underlying Medicare history file records that it produces, has remained relatively unchanged since its inception.

"The testing found all claims in the sample to be for valid patients and for valid Medicare items," according to the report. "the relevant system controls are generally adequate to support reliable processing of Medicare claims."

Considering the scale of transactions processed by MA, the ANAO concluded the MA information technology systems and complementary support and quality activities process achieve this in a timely manner.

In response to the findings, the CEO of MA Catherine Argall said: "Medicare Australia welcomes the assurance provided by the ANAO's report that our information technology systems and complementary support and quality activities achieve the processing of large-scale Medicare claims transactions accurately and in a timely manner. This is a positive outcome in providing confidence to the community about the integrity of the Medicare program."

"Medicare Australia agrees with the recommendations and audit findings," Argall said. "We are actively taking steps to implement the recommendations. We are committed to continually seeking to improve our business processes, including the electronic lodgement of Medicare claims and the quality of Medicare claims processing."

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