$1.5 billion in medication claims stuck unprocessed — while pharmacists wait and patients are delayed

Services Australia has $1.5 billion in uncertified Pharmaceutical Benefits Scheme (PBS) claims as of June 2024.

Root cause: Services Australia and the Department of Health and Aged Care failed to reach bilateral service agreements defining processing standards and responsibilities. Without agreed standards, neither agency could be held accountable for the backlog.

Performance metrics manipulation:

- Services Australia counts completed "calls" differently than Health

- Phone calls transferred to another agency are counted as "completed" by Services Australia even though the work wasn't done

- This artificially inflates Services Australia's performance metrics

- Digital processing rejection rate (5.6%) is more than double the phone channel rate (2.3%) — ANAO noted this anomaly without explanation

ANAO made 7 recommendations in the PBS authority system audit. Services Australia's self-assessment of progress on recommendations was described by ANAO as "partly effective" at best.

Impact: $1.5B in pharmacy claims sitting unprocessed means pharmacists are carrying accounts receivable they can't collect, creating cash flow pressure across the pharmacy sector. Patients with complex medication needs face delays and potential gaps in supply.

Sources:

- Medical Republic: https://www.medicalrepublic.com.au/pbs-authority-system-an-unnecessary-brake-on-good-care/115225

- ANAO PBS audit: https://www.anao.gov.au/work/performance-audit/administration-of-the-pharmaceutical-benefits-scheme