The $1.4 billion cosmetic surgery industry is illegally claiming Medicare rebates for medically unnecessary procedures such as facelifts, Botox, breast implants, and tummy tucks.
Experts including doctors, surgeons, and whistleblowers told a joint investigation by ABC's 7.30 program, The Sydney Morning Herald and The Age that the sector is recovering rebates from Medicare for services it is not entitled to claim.
Medicare was set up as a universal health system that provides free or subsidised health services that are medically necessary. It means rebates for cosmetic procedures are not claimable.
The joint investigation can reveal that, despite this, some practitioners have made claims through the system, including bulk billing pre-operative pathology and consultations for purely cosmetic surgery, as well as billing Medicare for cosmetic surgeries including tummy tucks and labiaplasty.
Dr Margaret Faux, who recently completed a PhD in Medicare and runs a business that processes Medicare bills for doctors, hospitals and corporate medical practices, said the cosmetic surgery industry was the worst offender for wrongful claims against Medicare.
"A unique feature of cosmetic procedures is that it captures an array of health practitioners including GPs, dermatologists, ear nose and throat specialists, anaesthetists, cosmetic surgeons, allied health and nurses," Dr Faux said.
Dr Faux has previously suggested nearly 30 per cent of Medicare's annual budget, or about $8 billion a year, is being lost each year through fraud, errors and waste. Serious flaws in Medicare's systems and weak regulation have made it easy to rort and almost impossible to detect the leakage.
Dr Tony Webber, who ran the government's Medicare watchdog for six and a half years until August 2011 and is now practising as a GP, said he identified some practitioners trying to claim cosmetic surgery on Medicare, including claiming labiaplasty surgeries, which is now one of the fastest growing cosmetic surgery procedures in the world.
Medicare has an item number for repairing vaginas but Dr Webber said some doctors were claiming it for surgeries which are not medically necessary.
'They tell you there are other problems that don't exist'
The consequences can be devastating. For Janine Kepert, it is a decision that changed her life.
"It's been amputated. I've had everything sliced off," she said.
In 2018, Ms Kepert underwent a breast reduction surgery and labiaplasty after a consultation at NorthEast Plastic Surgery in Melbourne for breast reduction surgery, due to neck and back pain.
During the consultation, she was asked if there was "anything else" she was interested in.
"I had some inflammation of my labia and I asked them to have a look at that. They also tried to talk me into doing a tummy tuck. I think the term they used was 'mummy makeover'," the single mother of two said.
"That's the cosmetic industry … you go in for one thing and they tell you there are other problems that don't exist.
"But you leave there thinking, 'I need this mummy makeover'."
She said she was told the more procedures she had, the more of a discount she would get.
She agreed to breast reduction and labiaplasty, saying the labiaplasty was described as a "minor procedure" to remove a small amount of labia tissue.
She ended up with nearly all her external genitals removed. It left her suffering from incontinence and loss of sexual function, making sexual relationships difficult.
Inappropriate Medicare billing identified
She took legal action through law firm Maurice Blackburn and Dr Sugitha Seneviratne was the plastic surgeon named in the proceedings.
Dr Patrick Tansley was the assistant surgeon.
As part of the legal process, Ms Kepert was assessed by a number of independent medical examiners (IME), including one who identified incorrect Medicare billing relating to her labiaplasty.
A letter written and tendered as part of the legal proceedings stated that the item number was "intended to deal with surgical repair of female genital mutilation or a major congenital anomaly … not covered by excising MBS items".
It said: "I doubt Ms Kepert was suffering from any of these conditions."
Dr Faux looked at Kepert's Medicare records and agreed there had been some inappropriate Medicare billing.
"It was particularly horrendous for Janine because her surgery ended up actually inflicting that precise mutilation on her," she said.
The legal action included being assessed by an independent medical panel. During that process, Dr Seneviratne vehemently denied negligence.
In March this year, the medical panel determined Ms Kepert had suffered a significant permanent injury.
She reached a settlement in August but wanted to speak up and warn others about the risks.
"This insidious practice is happening under a veil of secrecy, injured women are unlikely to come forward due to [the] intimate and sensitive nature of the injury," she said.
"Female genital surgery should only ever be for medical reasons."
In a statement, Dr Seneviratne and Dr Tansley denied that they engaged in any wrongdoing.
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