Fact Sheet – Ten Year Moratorium Scaling

Background

Medical practitioners who meet the definition of either an Overseas Trained Doctors (OTD) or a foreign graduate of an accredited medical school (FGAMS) are subject to the ten year moratorium under s19AB of the Health Insurance Act 1973 (the HIA). The moratorium places a restriction on the eligibility of these doctors to perform medical services under the Medicare Benefits Schedule (MBS).

In 2009, the Rural Health Workforce Strategy Budget Measure introduced a number of measures to respond to rural and remote workforce shortages. Under this measure, a variety of workforce incentives were scaled so that they provided the most benefit to doctors who practise in more regional and remote parts of Australia. The ten year moratorium scaling was one of the incentives introduced under this measure.

What does scaling do?

Scaling is a non-cash incentive that allows OTDs and FGAMS to have their name added to a class exemption under s19AB(3) of the HIA (the ‘scaling class exemption’). Once a doctor has their name added to the scaling class exemption, they are removed from the normal condition under s19AB of the HIA to practise in a recognised District of Workforce Shortage (DWS) for their specialty to qualify for MBS access.

While scaling does not reduce the length of the ten year moratorium, this incentive provides OTDs and FGAMS with the opportunity to significantly reduce the amount of time that they must practise in a DWS for MBS access while they are subject to the moratorium.

The moratorium scaling incentives took effect from 1 July 2010. The scaling discounts were not applied retrospectively, meaning services provided before this date do not attract a scaling discount.

Scaling was also deliberately applied to those OTDs and FGAMS who are working with access to the MBS in eligible locations. The scaling incentive is therefore not applied with consideration of doctors who are working without MBS access, such as those doctors who are working in salaried employment engagements

What are the requirements for scaling the ten year moratorium?

To scale the moratorium, an OTD or FGAMS must:
  • be working in an eligible regional or remote area under an s19AB(3) exemption and have an eligibility to claim MBS items for their services as part of their employment; and
  • achieve a minimum monthly billing threshold of $5,000.00 in an eligible area.

There is no formal application process for scaling. Instead, as scaling is based on a doctor’s MBS billing data, the Department of Human Services – Medicare applies scaling discounts once an OTD or FGAMS submits their MBS billing data, which is geocoded to the street address of the medical practice. When the billing threshold is achieved in an eligible location, the scaling benefit is applied.

Once a doctor accrues enough scaling benefits, they will have their name added to the scaling class exemption and will receive a notification from DHS. At this point, the doctor will be eligible to apply for MBS access at practice locations of their choice on the condition that they have satisfied Australian vocational recognition standards for working as an independent GP, specialist or consultant physician.

What are the eligible locations for scaling?

Health has defined eligible locations for scaling using the Australian Standard Geographic Classification – Remoteness Areas System (ASGC-RA) classification system, which applies a five-point scale (RA classifications) when classifying the level of remoteness of every Australian street address. The following table shows how scaling benefits are applied across the different remoteness areas:
RA Classification RA CategoryMonthly scaling benefit*Potentially reduces DWS period under the moratorium to:
RA 1Major CitiesNilNot reduced
RA 2Inner Regional3.37 days 9 years
RA 3Outer Regional13 days 7 years
RA 4Remote20.3 days 6 years
RA5Very

Remote

30.4 days5 years
* For each month the Minimum MBS Billing threshold is achieved.

The monthly scaling benefit is applied to the end date of the doctor’s moratorium. For each month the required MBS billing threshold is achieved, a set number of days will be credited from the moratorium end date until the doctor qualifies to be added to the scaling class exemption.

Assessing MBS claims for scaling

Eligibility for a scaling discount is determined by DHS based on the MBS claims submitted by/ on behalf of OTDs and FGAMS who are working in eligible regional and remote locations. The calculation is based on the ‘date of service’ and ‘schedule fee’ of MBS eligible services. The result determines whether the doctor has met the total ‘value of claims’ threshold of $5,000.00 for that month.

The ‘schedule fee’ of the following services is counted toward the total ‘value of claims’ each month:

  • all MBS services, including the assistance-at-operations item numbers;
  • Department of Veterans’ Affairs services that attract MBS items; and
  • late claims submitted after the end of a month (the scaling discount is applied retrospectively).
The following are not counted:
  • payments made through the discretionary compensation schemes (for example act of grace payments);
  • rejected MBS claims; and
  • bulk billing incentive items.

Applying scaling discounts

OTDs and FGAMS may only receive a single scaling discount for each month, even if they work in multiple medical practices located in different ASGC-RA categories. In cases where doctors are working in multiple locations, DHS calculates the doctor’s MBS claiming activities for the month in all eligible ASGC-RA categories, irrespective of the number of MBS eligible services provided in each category.

The doctor will receive the monthly scaling discount applicable to the major ASGC-RA category. The major ASGC-RA category is defined as the category where the highest value of MBS claims were processed for that doctor during the relevant month. It is determined by DHS when calculating MBS claiming activity.

Access to scaling information

DHS provides doctors with access to their scaling information through the Health Professional Online Services (HPOS) System. Doctors will need to register for this system to be able to monitor their scaling information.

Further information regarding the HPOS System is available from the DHS website: https://www.humanservices.gov.au/organisations/health-professionals/services/medicare/hpos

The Department of Health does not apply the scaling initiative and does not have access to raw scaling data. While Health provides information regarding the s19AB(3) exemption requirements through s19AB@health.gov.au, doctors are not able to get scaling updates through this email address.

Completing scaling

Each month, DHS calculates and displays eligible doctors revised ‘scaled’ end dates through the HPOS System. OTDs and FGAMS can view their progress towards meeting their return of service obligation. This process continues until the doctor’s scaled moratorium end date is equal to the current date (i.e. today’s date).

When this happens:

  • the Department of Human Services (DHS) adds the doctor’s name to the scaling class exemption;
  • (assuming the vocational recognition requirements have been satisfied) the doctor becomes eligible to apply for MBS access at a location of their choice, including non-DWS practices; and
  • DHS provides written notification to the doctor that they have been added to the scaling class exemption.

Scaling and the 5 Year OTD Scheme

Doctors who are working in a regional, rural or remote area under the 5 Year OTD Scheme do not also qualify for scaling discounts. Under the contracted arrangements for the 5 Year OTD Scheme, doctors receive moratorium incentives after they complete a specified return of service and become both a permanent Australian and a vocationally recognised GP. A separate s19AB class exemption has been made to cover doctors who successfully complete the 5 year OTD Scheme.