Sevdalis v Director of Professional Services Review (No 2)

The applicant, a medical practitioner, challenged the decision of the Director of Professional Services Review, who referred the applicant's conduct to a Committee for investigation. The Committee found that the applicant had engaged in "inappropriate practice" within the meaning of section 82(1) of the Health Insurance Act 1973 (Cth) by providing services outside of normal hours and outside of his consulting rooms. The Committee found that the applicant's clinical inputs were inadequate, did not meet the requirements of the Medicare Benefits Schedule, and that the applicant had fabricated documents purported to be contemporaneous clinical records. The Committee's findings were based on a sample of the services provided by the applicant. The Committee's report was given to the Director and the Determining Authority, who made directions that the applicant be reprimanded and counselled, fully disqualified for the purposes of section 19B for a period of two years, and that he repay $453,656.75 to the Commonwealth. The applicant commenced proceedings for judicial review, seeking to have the directions set aside.

The court had to decide whether the Committee wrongly inferred a requirement that clinical records must be accessible to other practitioners and whether the Committee wrongly inferred a requirement that there be a clinical need for relevant services. The court also had to decide whether the directions of the Determining Authority were punitive rather than protective, whether full disqualification from receiving medicare benefits was justified in the circumstances, and whether full repayment of medicare benefits in proportion to the findings of inappropriate practice was justified where the findings were based on a sample of services. The court had to consider whether the Determining Authority failed to take into account a mandatory relevant consideration by failing to consider whether partial disqualification or partial repayment would be sufficient to meet the objectives of the Professional Services Review Scheme.

The court found that the Committee's findings were based on a sample of the services provided by the applicant and that there was no requirement that clinical records must be accessible to other practitioners or that there be a clinical need for relevant services. The court found that the directions of the Determining Authority were not punitive but were designed to protect the integrity of the Commonwealth medical and pharmaceutical benefits programs. The court found that full disqualification from receiving medicare benefits was justified in the circumstances and that full repayment of medicare benefits in proportion to the findings of inappropriate practice was also justified. The court found that the Determining Authority had considered whether partial disqualification or partial repayment would be sufficient to meet the objectives of the Professional Services Review Scheme and had decided that full disqualification and full repayment were necessary.

The court dismissed the applicant's application for judicial review and ordered that the applicant pay the costs of the respondents. The court granted the application for an extension of time to make an application under the Administrative Decisions (Judicial Review) Act 1977 (Cth).