Medicare Compensation Recovery information for insurers and other payers
Before paying someone compensation, you're required by law to tell us and pay any amounts owed to the Commonwealth.
About a compensation payment
Compensation is money awarded for an injury or illness. It can be a payment from an insurance company, an individual or another company.
For information for the injured person read the Medicare Compensation Recovery.
When you need to tell us
The Health and Other Services (Compensation) Act 1995 (the Act), applies when an injured or ill person gets either:
- an eligible benefit payment provided through Australian Government programs
- an awarded compensation payment where another party is liable for the relating treatment or care costs.
The compensation payer, usually the insurer, must tell us about the payment, within 28 days from when either:
- a judgment or settlement fixes the value of compensation awarded at more than $5,000 including all costs
- a reimbursement arrangement is made more than 6 months from the date the claim was made.
If you don’t tell us, you may be liable for any outstanding amount owing to the Commonwealth.
Use the date you filed with a court as the date of settlement or the date the arrangement was made.
You still need to tell us if you either:
- don’t have insurance and needed to be insured
- had insurance and a claim was made against you.
How to tell us
- attach any relevant information asked for on the form
- make sure you sign the form
- return the form to us within 28 days from the date the judgment, settlement or reimbursement arrangement was made.
You must not release the compensation payment to the injured person or claimant until you have paid us. You can choose to make an advanced payment or pay the notice of charge.
You can send the completed form to us by post, fax or email.
When you don’t need to tell us
You don't have to tell us about the payment if either:
- the total amount of compensation awarded including all costs is less than $5,000
- the reimbursement arrangement date is less than 6 months from the date the claim was made
- you’re not insured and don’t need to be.
For information about recovery of future care costs for the compensable injury or illness email Department of Health.
Repayments for eligible benefits
You may need to repay eligible benefits including:
- Medicare benefits
- nursing home benefits
- residential care subsidies
- home care subsidies.
In order to find out the amount of eligible benefits you need to repay, request a Medicare history statement.
The statement lists each service the injured person received a Medicare benefit for. This includes services since the date of their injury or illness to the date of the request.
How to request a Medicare history statement
You, the injured person, claimant or their authorised third party can request a statement. Use the Medicare history statement request form (MO026).
We’ll only send it to the injured person, claimant or their authorised third party. The statement also comes with a declaration form that the injured person, claimant or authorised third party needs to complete.
What to do with the statement
The injured person, claimant or authorised third party needs to indicate which services relate to the compensable injury or illness. They need to tick the relevant check boxes in the statement. They also need to declare if they received any nursing home benefits, residential or home care subsidies.
They need to return the statement and declaration form to us within 28 days. If they don’t, all their listed services will be taken as relating to their compensable injury or illness.
We assess the information and reconcile the total amount of eligible benefits paid. We then give you a notice of past benefits and send a copy to the injured person.
The difference between a notice of past benefits and notice of charge
A notice of past benefits lists the services identified and if any eligible benefits were paid in total.
A notice of charge is a notice after either:
- a judgment or settlement for the compensation claim occurs
- a reimbursement arrangement is entered into within 6 months of the notice being issued.
We issue a notice of charge to either:
- you to pay the amount specified
- the injured person where an advance payment has been made and an amount is still outstanding.
Overdue Medicare history statements
The injured person has 2 years to submit an overdue Medicare history statement for processing from either:
- date of judgment or settlement
- date of reimbursement arrangement.
In accordance with Privacy Principles, the notice will only specify the total amount of eligible benefits paid. It won’t list the services.
Fixed medical, care costs or apportionment of liability
If a judgment or settlement has fixed the amount of past medical or care expenses, we adjust the amounts accordingly.
If it specifies that liability be apportioned between the parties, we reduce the amount payable by the proportion of liability.
Making payments to us and the injured person
It’s an offence to pay the injured person or claimant any part of the compensation awarded unless the following applies:
- you’ve paid us the amount specified in the notice of charge
- you’ve withheld that amount
- you’ve paid us an advance payment.
- date of judgment or settlement
- date of reimbursement arrangement.
You may not get a notice of past benefits within the 6 months before the judgment or settlement date. In this case, at the time of notification you may either:
- request a notice of charge and pay us the amount specified within 28 days from the issue date
- pay a 10% advance of the total compensation amount awarded within 28 days from the date of judgment or settlement.
You can then pay the balance of the compensation to the injured person.
If the amount owing is less than the advance payment, we’ll refund the balance to the injured person within 28 days. If the amount owing is more, the injured person needs to pay the difference to us within 28 days.
You cannot make an advance payment if there is a valid notice of past benefits.
You may not get a notice of past benefits within the 6 months before the reimbursement arrangement is made. If so, request a notice of charge and pay us the amount specified. The payment needs to be within 28 days from the date of issue.
You may need to wait for Centrelink clearance before making the compensation payment to the injured person.
You don’t need to wait for Centrelink clearance before either:
- paying us the 10% advance payment and submitting the Notice of Judgment or Settlement form (MO022)
- submitting the Notice of Judgment or Settlement form (MO022) to request a notice of charge if you choose not to pay the advance payment.
Centrelink Compensation Recovery
We recover Centrelink payments differently to Medicare payments.
If the claimant receives a Centrelink payment, a compensation payment could affect the amount they’re entitled to. You may need to repay all past payments.
You also have to tell us about the compensation payment, no matter what the amount.
Read about Centrelink Compensation Recovery.
Compensation forms list
You may need these forms for Medicare Compensation Recovery:
- Medicare Compensation Recovery Notice of judgment or settlement form (MO022)
- Medicare Compensation Recovery Compensation payer’s Electronic Funds Transfer details collection form (MO025)
- Medicare Compensation Recovery Medicare history statement request form (MO026)
- Medicare Compensation Recovery Notice of reimbursement arrangement form (MO027).
Contact us if you need more information about Medicare Compensation Recovery.
Page last updated: 6 October 2021
This information was printed 25 October 2021 from https://www.servicesaustralia.gov.au/organisations/business/services/medicare/medicare-compensation-recovery-information-insurers-and-other-payers. It may not include all of the relevant information on this topic. Please consider any relevant site notices at https://www.servicesaustralia.gov.au/individuals/site-notices when using this material.