Sinha, P.R. v Asher, J

[1989] FCA 215

Re: PRABHAT RAJ SINHA
And: JOAN ASHER; GODFREY DOUGLAS; JOHN CAMPBELL; KENNETH RAWLE and
PATRICK HARVEY
No. NSW NG132 of 1989
FED No. 215
Health Insurance
22 FCR 423

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Wilcox J.(1)

CATCHWORDS

Health Insurance - Reference to Medical Services Committee of Inquiry - Doubts as to whether services assumed by reference to have been rendered by practitioner were in fact rendered - Whether Committee entitled to express such doubts - Obligation of Committee to consider issue of excessiveness despite doubts.

Health Insurance Act 1973 ss.79, 82, 104.

HEARING

SYDNEY

#DATE 12:5:1989

Counsel for the Applicant: Mr M J Baker

Solicitors for the Applicant: Dunhill Morgan

Counsel for the Respondents: Mr R N Greig

Solicitors for the Respondents: Australian Government Solicitor

ORDER

The Application be dismissed.

The applicant pay to the respondents their costs of the proceeding.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This application for review raises a question regarding the powers of a Medical Services Committee of Inquiry constituted under the Health Insurance Act 1973. The proceeding is brought, pursuant to the Administrative Decisions (Judicial Review) Act 1977, by Prabhat Raj Sinha, a medical practitioner, who is presently subject to an inquiry by a Committee consisting of the five respondents, Joan Asher, Godfrey Douglas, John Campbell, Kenneth Rawle and Patrick Harvey. By his Application the applicant seeks certain declarations and an injunction restraining the respondents from making any report to the Minister other than a report in terms of s.104 of the Health Insurance Act; that is, relevantly, a report expressing an opinion upon the question whether the applicant has rendered excessive services and, if so, identifying those services.

1. The Health Insurance Act provides, by Part II, for the payment on behalf of the Commonwealth of medicare benefits. Payments are made in respect of "professional services", a term which is defined by s.3 so as to include "a medical service to which an item relates, being a service that is rendered by or on behalf of a medical practitioner".

2. Part V of the Act establishes, and regulates the activities of, various Committees. Division 3 deals with Medical Services Committees of Inquiry. Section 80 requires the Minister to establish one or more of such Committees in each State, each Committee consisting of five medical practitioners. The function of Medical Services Committees of Inquiry are set out in s.82, namely "to inquire into, and submit to the Minister its report and recommendations on, any matter referred to the Committee by the Minister, being a matter that--
   

(a) is relevant to the operation or administration of this Act or the National Health Act 1953 (other than Part VII of that Act); and

(b) arises out of or relates to the rendering of a professional service (other than a pathology service), on or after 15 April 1977, in the State for which the Committee is established."

1. In the present case, the reference was expressed in these terms:
   

"I, Peter Elliot Gunton, Delegate of the Minister of State for Community Services and Health, pursuant to section 82 of the Health Insurance Act 1973, HEREBY REFER to the Medical Services Committee of Inquiry for the State of New South Wales for inquiry into, and submission of a report and recommendations to the Minister of State for Community Services and Health on, matters relevant to the operation or administration of the said Act, which arise out of the rendering of professional services in the State of New South Wales after 15 April 1977, namely, whether each professional service rendered to a patient by Dr Prabhat Raj Sinha, medical practitioner, particulars of which are set out in Annexure marked 'B' numbered 1 to 59, being a service for which Medicare benefit has been paid, was an excessive service within the meaning of section 79(1B) of the said Act"

Attached to the reference was a document containing schedules of services said to have been rendered by Dr Sinha to each of 59 patients. Each schedule set out particulars of the date of the alleged service, the relevant medical benefits item number and the amount of benefit paid in respect of that service.

1. Notice of the reference was given to Dr Sinha by Dr Asher, the Committee chairperson. Attached to the notice was a copy of the document containing the schedules.

2. The inquiry commenced on 12 January 1989 when the applicant attended, accompanied by counsel, Mr Batey. The Committee commenced to work through the various schedules, discussing with the applicant the treatment given by him to each of the patients named therein. As this was a lengthy task, the inquiry had to be adjourned from time to time.

3. The session of the inquiry which was held on 2 February 1989 commenced with discussion about a patient whom I will refer to as "D". At the invitation of members of the Committee the applicant gave a general description of "D's" state of health and his treatment at the applicant's hands. The applicant, consistently with the schedule relating to "D", claimed that, on a number of occasions, he had performed continuous compression sclerotherapy injections. This procedure is item 4633 in the benefits table. He was closely questioned about that claim whereupon the Committee briefly adjourned. Upon resumption, the following exchange occurred between one member of the Committee, Dr Douglas, and the applicant:
   

"DR. DOUGLAS: Dr. Sinha, we've been discussing the nature of your treatment of varicose veins and it seems to us that a real doubt exists as to whether you have in fact been performing continuous compression sclerotherapy multiple injections or performing injection of varicose veins. Therefore, that is not something which comes with the purlieu (sic) of this Committee. We inquire into possible overservicing. We don't inquire into the use of incorrect item numbers. So we've discussed it and we think that in regard to this patient, because this doubt exists, it would not be proper for us to continue to consider these services, but that we would have to report to the Minister that in respect of the services which have been claimed as continuous compression sclerotherapy that we have doubt as to whether that was what was performed and what happens after that of cause (sic) is a matter for the Minister not a matter for this Committee. So as far as this patient is concerned, we do not want to ask any more questions or take any more evidence with regard to the injection of varicose veins. Are you quite clear about that?

DR. SINHA: No, I would like to know on what basis have you come to that conclusion.

DR. DOUGLAS: Well, we've come to the conclusion on the basis of our clinical experience, principally mine because I'm a surgeon and I treat varicose veins and also upon the references which you provided for us and references which we have ourselves.. DR. SINHA: All right.

DR. DOUGLAS: ..which we are prepared to table also. And all I'm saying is that there's a doubt exists in the minds of the members of the Committee and we cannot continue to consider them in the light of overservicing while that doubt exists."

There was further discussion, but it was essentially repetitive of that set out above. Dr Douglas led this discussion but, in so doing, he seems to have expressed the view of all members of the Committee.

1. At the commencement of the following session of the inquiry, on 9 February 1989, Mr Batey returned to the matter discussed between Dr Douglas and the applicant on the previous occasion. He sought from the chairperson "clarification" on "whether it's the intention of the Committee to report that there is a doubt that the doctor performed that service as described by 4633 in a report, or any report or any communication to the Minister". After further discussion and a short adjournment the chairperson answered the question in these terms:
   

"Right, if at the conclusion of this hearing, which is the only time which we will be making a report to the Minister, a doubt still exists in our minds as to whether or not that services as described has been incorrectly itemised that doubt will be conveyed to the Minister, in the final report."

1. Since 9 February 1989 the Committee has met on several occasions, continuing its investigation of the treatment provided to the patients listed in the schedules. That task is not yet complete but, in anticipation that the Committee will adhere to the position indicated by Dr Douglas and the chairperson, this proceeding has been brought. Stated in broad terms, the submission of the applicant is that the course which is proposed by the Committee is beyond its powers.

2. Section 104 of the Health Insurance Act deals with the report of a Committee:
   

"104. After completion by a Committee of a hearing in relation to a matter, the Committee shall report to the Minister its opinion on the matter and, in a case where the Committee, in the report, expresses the opinion--

(a)that a practitioner specified in the report has rendered excessive services; or

(b)that a person specified in the report has caused or permitted a practitioner--

(i)who is employed by the person so specified; or

(ii)who is employed by a body corporate of which the person so specified is an officer,

to render excessive services, the report shall identify the excessive services."

The term "excessive services" is defined for the purposes of Division 3 of Part V by s.79(1B):

"(1B) A reference in this Division to excessive services is a reference to professional services (other than pathology services), being services in respect of which medicare benefit has become or may become payable and which were not reasonably necessary for the adequate medical or dental care of the patient concerned."

1. The argument on behalf of the applicant commences by referring to the use in s.82 of the word "matter". The function of a Committee, says counsel, is to inquire into, and report upon, "any matter referred to the Committee by the Minister". In the present case the "matter" identified in the delegate's reference was "whether each professional service rendered to a patient" by the applicant, as particularised in the Schedule, "was an excessive service" within the meaning of s.79(1B) of the Act. Counsel emphasises that the reference not only fails to raise any question regarding the rendering of the listed services; its form assumes that each service was in fact rendered. The only question committed to the Committee was whether "each" service -- perhaps, more happily, any service -- was excessive. Moreover, counsel points out that, in framing the reference in that way, Mr Gunton followed the pattern of the Act itself. Section 82(b), the paragraph under which the reference was given, refers to a "matter that arises out of or relates to the rendering of a professional service" and, as previously stated, a "professional service" is a service "that is rendered by ... a medical practitioner". Parliament had in mind a service actually rendered. Similarly, although s.104 imposes a broad duty upon the Committee to report to the Minister "its opinion on the matter", that is the matter referred, the requirement as to identification relates only to cases where the Committee expresses the opinion that the practitioner has rendered, or has caused or permitted the rendering of, excessive services. There is no provision for the identification of services claimed, but not rendered; as might be expected if the Act had contemplated that this would be a task entrusted to Committees.

2. I accept the submission of counsel for the applicant that the role contemplated for Committees under the Act -- at least in the case of references falling within s.82(b) rather than s.82(a) -- is the determination of the question whether particular services are excessive; and also that the Act contemplates that Committees will approach that task upon the assumption that services claimed by the practitioner to have been rendered have actually been rendered. I further accept that the reference delivered to the respondents, in the present case, makes the assumption that each of the services claimed by the applicant has actually been rendered by him. I do not think that the reference requires the respondents to investigate the question whether the claimed services, or any of them, was actually rendered.

3. But it is another matter to say that if, in the course of its investigation of excessiveness, the respondents develop doubts as to whether particular services were in fact rendered they are precluded from reporting those doubts to the Minister. The adoption of that view would have extraordinary consequences. It must happen, from time to time, that medicare benefits are incorrectly claimed by practitioners; that claims are made for services which are not in fact rendered. This may happen because of fraud; but incorrect claims may be made in innocent error. For example, a practitioner may regularly see a chronically ill patient each week, or may perform a particular procedure at regular intervals. The practitioner may go on holidays without making adequate arrangements for that patient so that the patient is not seen, or the procedure not performed. Overlooking the omission, the practitioner's accounts clerk may submit claims for medicare benefits as if the usual routine had been followed. Suppose the Medical Services Committee of Inquiry is appointed to consider whether the practitioner has rendered excessive services to that patient. During the course of the Committee's deliberations it may become obvious that incorrect claims have been made. The practitioner may concede as much. In such a case, it would be an absurd situation if the Committee had solemnly to report to the Minister upon the excessiveness of services which it knew had not been rendered, without informing the Minister of that fact. And it is no answer to say that the Committee could, in effect, recommend the disallowance of benefits for those services by characterising them as excessive. It may be that the pattern of servicing established by the practitioner for the patient was reasonable, in the judgment of the Committee. If so, upon the assumption which the Committee was asked to make -- that the services were in fact rendered -- the Committee could not properly characterize the services as excessive; the result being to maintain benefits for services which, it was clearly established, were not provided.

4. In order to point up the ramifications of the applicant's submission I have taken a case of admitted error. More often, I suppose, the factual situation will be less clear; the practitioner not conceding any error in the claim for benefits. Nonetheless, members of the Committee may develop doubts, ranging all the way from mild scepticism to near certainty, as to whether the claimed services were in fact provided. Once again it would seem to me to be curious, and unfortunate, if the Committee was prohibited from alerting the Minister to those doubts, so that the question whether the services had in fact been rendered might be investigated, if the Minister so chose.

5. The question I have to decide is whether the Act does have the consequences which I have just discussed. I do not think that it does. It seems to me that the fallacy in the argument for the applicant is that it treats the powers of the Committee, in relation to its report, as necessarily being co-extensive with its duty. Section 104 of the Act imposes a duty on a Committee to report "on the matter"; that is, I agree, the matter referred under s.82. In this case the matter referred was confined to the question whether any of the services set out in the Schedules were excessive. If excessiveness is found, the Committee is required by the concluding words of s.104 to identify the services found to be excessive. In the present case, it is clear that the duty of the Committee in relation to its report does not extend beyond the issue of excessiveness.

6. However, it is another matter to say that the power of the Committee is so limited. I agree that the Committee has no power to make any determination of the question whether particular services were rendered. The Act provides other mechanisms for the determination of such a question: see Part VB dealing with Medicare Participation Review Committees and the provisions contained in Part VII relating to the recovery from practitioners of moneys paid as a result of a false or misleading statement. But it does not follow that the Committee is precluded from stating its view that such a question arises in relation to the services, or some of the services, the excessiveness of which it has been asked to examine. It is a commonplace event for administrative tribunals or investigating committees to make observations upon matters arising out of their investigations about which they are not required to make findings. So long as those observations fairly arise, do not purport to be definitive findings and are relevant to the general scope and purpose of the legislation under which the tribunal or committee operates, I see no objection about that course. Obiter remarks, whether made by administrative bodies or judges, are made for what they may be worth and in an endeavour to be helpful to the parties or to advance the public interest. If the Committee does express the doubts which it has foreshadowed, no interest of the applicant will be directly affected. No legal right will be infringed. The only consequence of any such observation will be that the Minister may choose to investigate the correctness of the applicant's claims for benefits and, depending upon the outcome of that investigation, to take one of the courses provided by the statute in respect of incorrect claims. If the Minister does take one of those courses, the applicant will have the benefit of all of the usual rights of a person in his position, unaffected by the observations of the respondents. I reject the argument that the respondents are precluded from reporting any doubts as to the rendering of services which they may harbour at the time of framing their report.

7. A subsidiary question arose during the course of argument: the correctness of the decision announced by the Committee not to consider the issue of excessiveness in relation to services about the rendering of which it had formed doubts. Counsel for the respondents defends this decision. He says that the task of a Medical Services Committee of Inquiry is to examine whether services which have actually been rendered are excessive; so that, if there is a doubt as to the rendition of a particular service, the Committee ought not to consider whether that service, if it had been rendered, would have been excessive.

8. I do not accept this analysis. As I have already stated, the reference which was given to the Committee in the present case identified a list of services which were said to have been rendered by the applicant to various named patients. The task of the Committee was to investigate, and report upon, the question whether any of those services was excessive and, if so, to identify the excessive services. Whatever doubts might arise in the minds of Committee members, during the progress of the investigation, as to whether particular services were rendered, it remained their duty to investigate and report upon the question of excessiveness. Even in a case where a doubt amounts to certainty, because of an admission by the practitioner concerned, it is not for the Committee to assume that the Minister will take any action for the recovery of the benefits upon the ground that the services were not rendered. The Minister remains entitled to the report of the Committee in connection with excessiveness. This position applies even more strongly in cases, such as the present case, in which the doubt falls short of certainty. The doubt may turn out to unfounded or the factual position may be found to be so uncertain as not to justify action for recovery of the benefits. In such a case it may be important for the Minister to have advice regarding excessiveness.

1. In the present case it is not clear whether or not the Committee feels that it is impossible to determine the excessiveness of the claimed continuous compression sclerotheraphy injections without knowing for certain whether these injections were actually given. Of course if, for whatever reason, a Medical Services Committee of Inquiry is unable to reach a conclusion upon the question whether particular services were excessive, it should say so: see Minister for Health v Thomson (1985) 8 FCR 213 at p 225. But it is not apparent to me that there is any particular problem in the present case. The Committee has obtained information about the medical condition of "D". It knows the nature of the claimed services, continuous compression sclerotherapy injections. I do not see any difficulty in the Committee reporting its opinion as to necessity for this service to be supplied to "D", and as to the frequency of supply.

2. The Application should be dismissed with costs.