Disability support pension reviews may cost more than they save

By David Donaldson

May 11, 2017

A government-controlled parliamentary committee has questioned the usefulness of the Department of Human Services’ disability support pension eligibility reviews, arguing they cause unnecessary distress and may end up costing more than they save.

Questionable processes for identifying recipients to review have seen profoundly disabled people, and people with incurable disorders such as down syndrome, being asked to prove they are still unable to work, despite other government agencies holding data showing those individuals are at very low risk of becoming ineligible, such as those receiving full-time publicly-funded care.

“Poorly targeted reviews by Human Services pick on vulnerable Australians and run up Medicare bills to prove the bleedingly obvious.”

The report of the parliamentary Joint Committee of Public Accounts and Audit, tabled on Wednesday as a follow up to an earlier Australian National Audit Office report, notes that only 1.6% of reviews in 2016-17 resulted in people being moved off the DSP, raising the prospect that the department might be spending more to conduct the poorly targeted reviews than it saves by removing ineligible recipients. It is unknown how much the reviews cost, however, as DHS has refused to release the regulatory impact statement, citing cabinet in confidence.

In light of these concerns, the committee has recommended DHS and the Department of Social Services conduct a complete end-to-end review of the administration of the entire DSP program, which provides support to permanently disabled Australians who are unable to support themselves by working. It also recommends the ANAO consider a follow up audit of the departments’ administration of the program.

The committee wants improved data sharing between federal and state agencies to ensure that manifestly (automatically) eligible recipients and other severely disabled people are excluded from being reviewed.

It raised concerns about how reviews are conducted as well, highlighting that the current deadline of 21 days for recipients to respond was difficult for many to meet, especially people in remote areas. The committee also wants the government to rethink recent changes that mean most claims are reviewed by bureaucrats, rather than medical doctors.

Since the ANAO tabled its report in January 2016, DSP administration “has changed substantially, and not for the better”, argues committee deputy chair Julian Hill.

Submitters to the committee’s inquiry raised fresh concerns regarding the government’s new assessment and review processes, such as eligibility reviews being conducted on Australians with severe and permanent intellectual, physical and psychological disabilities and no capacity to work, causing needless hardship and anxiety for families.

“The committee received dozens of submissions and heard evidence of poorly targeted reviews by Human Services which pick on vulnerable Australians and run up Medicare bills to prove the bleedingly obvious,” said the Labor MP.

“The true costs to government of undertaking DSP reviews, including waste in Medicare to gather medical evidence, remain a secret as DHS won’t release the regulatory impact statement. The burden borne by carers is much higher and is outrageous.”

Annual expenditure on the DSP currently sits at around $17 billion.

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