This report was prepared for the Australian Broadcasting Corporation to assess payment integrity in spinal surgery billing, as part of a broader investigation into chronic low back pain.
Our brief was to analyse private health insurance inpatient billing for spinal surgeries to identify red flags, patterns, and areas for reform. Six private health insurers, covering 25% of the market, provided billing data for 23,635 patients who underwent spinal fusions and decompressions between November 2017 and May 2023, totalling $647 million in claims.
We partnered with Kirontech (a UK-based healthcare fraud detection company) to analyse 79,725 lines of billing data. Kirontech’s proprietary software was used to detect anomalies, while Synapse conducted a parallel manual review. All findings were cross-validated by both teams.
Our findings reveal an alarming trend: Australia’s healthcare system is being drained by widespread billing abuse.
Key issues included:
- Billing for services that were not provided.
- Billing for longer or more complex services than were actually delivered.
- Charging for add-on services—such as bone grafts or additional spinal levels—that were not performed.
- Unwarranted ICU admissions.
- Providing and billing for unnecessary, sometimes harmful, procedures.
- Double billing for the same time period or service.
- Breaches of specific Medicare rules, particularly around spinal fusions.
- Concerning use of invasive monitoring by anaesthetists.
- Implausible high-value item billing by physicians and geriatricians.
Although data-driven, our review led to a shared conclusion: fraud, waste, and abuse in spinal surgery billing is a serious and systemic issue. The sample – representing a quarter of the private health insurance market – is large enough to be considered representative. The problems were widespread, affecting many aspects of billing, and suggest a deeper cultural and structural problem that enables reckless billing practices to thrive.