Medicare Audit-Ready Documentation: A GP's Guide to MBS Item Number Compliance

Understanding the PSR Process

The PSR scheme was established under the Health Insurance Act 1973 to protect the integrity of Medicare. It operates through a referral process:

1. Medicare Australia data analysis identifies practitioners with unusual billing patterns — high volumes, unusual item number distributions, or statistical outliers.
2. Director of PSR assesses the referral and may request a written explanation from the practitioner.
3. PSR Committee (if the matter proceeds) reviews a sample of clinical records against the MBS descriptors.
4. Determining Authority can impose sanctions including repayment of Medicare benefits, counselling, reprimand, or exclusion from Medicare for up to 5 years.

The critical point is that the PSR Committee examines your actual clinical records. If your notes do not demonstrate that the service met the MBS descriptor requirements, the Committee may find inappropriate practice — even if you did in fact provide the service. In other words, undocumented care is indistinguishable from care not provided.

Time-Based Consultation Items: The Core Risk Area

The most commonly audited GP item numbers are the time-based consultation items. The key items and their requirements are:

Standard Consultations (Level A to D)

Item 23's descriptor is structured: the consultation must take place at consulting rooms, must last at least 6 minutes and less than 20 minutes, and must involve taking a relevant history, performing an examination, or both. Consultations under 6 minutes belong to Item 3 (Level A). If your notes show only 'sore throat, amoxicillin prescribed' with no mention of history or examination — even if the duration is in range — a PSR Committee could question whether Item 23 was appropriate rather than Item 3.

What Your Notes Must Demonstrate for Each Level

Item 23 (Level B) documentation must show:

• A presenting complaint or reason for attendance
• Relevant history (even if brief) OR clinical examination findings
• Your clinical assessment or impression
• Management plan or advice given

Item 36 (Level C) documentation must show:

• A detailed history covering the presenting complaint and relevant background
• Clinical examination findings (not just 'examined — NAD')
• Investigations ordered or arranged (pathology, imaging, referrals)
• A clear assessment and management plan
• Evidence that the consultation was of sufficient complexity and duration

Item 44 (Level D) documentation must show:

• An extensive, multi-system history
• A comprehensive examination with documented findings across relevant systems
• Multiple investigations or complex management decisions
• Evidence of significant clinical complexity warranting the extended consultation
• Consultation duration should be documented or clearly implied by the depth of the note

Mental Health Treatment Plans (Items 2715/2717) and Reviews (Items 23 / 36 / 44)

Mental Health Treatment Plans and reviews are frequently audited because they attract higher rebates and have specific descriptor requirements. Items 2715 and 2717 are the preparation items (consultation under 40 minutes vs at least 40 minutes, both for GPs with mental-health-skills training). The previously-cited dedicated review item 2712 has been retired — subsequent MHTP reviews are now billed under the time-tiered attendance items 23 / 36 / 44, with the AN.0.56 timing rule (at least 4 weeks since the MHTP, at least 3 months since the previous review).

Item 2715 (Preparation of a GP Mental Health Treatment Plan, 20 to less than 40 minutes)

Your documentation must demonstrate:

• Assessment of the patient using a validated screening tool (e.g., K10, PHQ-9)
• A diagnosis or clinical formulation
• A treatment plan that includes psychoeducation, non-pharmacological interventions, pharmacological treatment (if applicable), and referral arrangements
• The plan must be documented and provided to the patient
• You must arrange review within a specified timeframe

Item 2717 (Preparation of a GP Mental Health Treatment Plan, at least 40 minutes)

Item 2717 is the longer-consultation counterpart to 2715 — same descriptor requirements as 2715, but the consultation must run for at least 40 minutes face-to-face. Your documentation must additionally demonstrate:

• Start and end times confirming at least 40 minutes face-to-face with the patient
• All of the 2715 documentation elements above

Common audit failure (2717): Consultation under 40 minutes claimed as 2717 instead of 2715, or 2717 billed for a follow-up review consultation. Reviews must be billed under items 23 / 36 / 44 (with the AN.0.56 timing rule), not 2717.

MHTP Review (Items 23 / 36 / 44 — AN.0.56 timing)

The MHTP review pathway is the time-tiered attendance items, sized to the duration of the review consultation:

• Item 23 (Level B, less than 20 minutes) — short review of a stable patient.
• Item 36 (Level C, at least 20 minutes) — typical MHTP review consultation.
• Item 44 (Level D, at least 40 minutes) — extended review where complexity warrants.

Whichever level you bill, your review note must show:

• AN.0.56 timing compliance: at least 4 weeks since the MHTP was prepared (under 2715/2717), and at least 3 months since the previous MHTP review.
• Reassessment using the same validated tool used in the original MHTP (comparing the current score to baseline).
• Review of the current treatment plan against each original goal — specific, not generic.
• Assessment of progress toward each treatment goal.
• Any modifications to the plan, with reasoning, OR an explicit "no changes required" rationale.
• Updated referral arrangements if applicable.
• The next MHTP review date set at least 3 months ahead.

Common audit failure: A note that says 'MHTP review, patient improving, continue current management, review 3 months' lacks the required elements. There is no reassessment tool score, no reference to specific treatment goals, and no documented review of the plan itself. AN.0.56 explanatory note states that an MHTP review 'should not' be undertaken within 4 weeks of the original MHTP or within 3 months of the previous review — this is advisory wording, and Medicare does not automatically reject claims that fall outside these intervals. PSR review may apply the timing rule during audit, however, so document the dates regardless.

GP Chronic Condition Management Plans (Items 965 / 967)

Effective 1 July 2025, the legacy GP CDM framework (GPMP item 721, TCA item 723, GPMP review item 732) was retired and replaced by the consolidated GP Chronic Condition Management Plan (GPCCMP) framework — item 965 for preparation, item 967 for face-to-face review. The TCA collaborative-care function was folded into 965; multidisciplinary care plans for patients needing collaborative care are now separately numbered (231/729 non-RACF, 232/731 RACF). Patients with plans under the legacy framework can continue under those arrangements until 1 July 2027.

Item 965 (GPCCMP — preparation)

The MBS descriptor requires:

• Identification of the patient's health and care needs
• Agreed goals (measurable, agreed with the patient)
• The actions to be taken by the patient
• The actions to be taken by the GP
• The treatment and services the patient requires from other providers (where multidisciplinary input is part of the plan)
• The plan must be documented, agreed with the patient, and provided to the patient (and to other providers where relevant)
• A review timeframe must be set (with the next review billed under item 967)

Your notes must demonstrate each of these elements. A plan that only lists medications and a review date does not meet the descriptor.

Item 967 (GPCCMP — review face-to-face)

Reviews are billed at most once every 3 months unless exceptional circumstances apply. Your review note must show:

• Date of review, date the plan was prepared (or last reviewed), and confirmation that at least 3 months have elapsed since the previous 967 review (or that exceptional circumstances apply, with documentation)
• Progress against each agreed goal in the plan — specific, not generic
• Reassessment of the patient's actions, the GP's actions, and the services from other providers
• Any modifications to the plan, with reasoning, OR an explicit "no changes required" rationale
• Confirmation that an updated plan (or confirmation of unchanged plan) was provided to the patient
• The next review interval

Common audit failure (967): Item 967 claimed within 3 months of the previous 967 review without exceptional-circumstances documentation. Plan reviewed but no documented changes or explicit "no changes required" rationale.

Legacy items (721 / 723 / 732)

These items are no longer billable for new claims. If you are caring for a patient still under a legacy plan, the patient's continuation arrangements remain valid through 1 July 2027 — but new chronic-condition management plans must be prepared under item 965, not 721. The previous library entries for /library/mbs/721 and /library/mbs/723 now redirect to /library/mbs/965; /library/mbs/732 redirects to /library/mbs/967.

Notes That Pass vs Notes That Fail

Example: Diabetes Review

Would likely fail audit (Item 36 claimed):

'Diabetes review. HbA1c 7.2. Continue metformin. Review 3 months.'

This note provides no history, no examination findings, no evidence of the complexity required for Item 36, and no detailed management plan.

Would likely pass audit (Item 36 claimed):

'T2DM review. Last HbA1c 7.2 percent (previously 7.8 percent, improving). Patient reports good adherence to metformin 1g BD. Diet improved, walking 30 minutes 4 days per week. No hypoglycaemic episodes. Denies polyuria, polydipsia, visual changes, or foot symptoms. Examination: BP 134/82, weight 89kg (down 2kg), BMI 28.1. Feet: sensation intact to monofilament bilaterally, pedal pulses present, no skin breakdown. Assessment: T2DM with improving glycaemic control on current regimen. Plan: Continue metformin 1g BD. Repeat HbA1c and lipids in 3 months. Annual eye review due — referral to optometrist today. Discussed continuing dietary improvements and increasing exercise to 5 days per week. Review in 3 months with results.'

This note demonstrates a detailed history, clinical examination, investigation management, and a comprehensive plan — all elements required by the Item 36 descriptor.

Documentation Checklist for Every GP Note

Regardless of the item number you bill, every clinical note should contain:

• Date and time of the consultation
• Presenting complaint or reason for attendance (in the patient's terms or your clinical terms)
• Relevant history — even 'no relevant PMHx' is better than nothing
• Examination findings — document what you examined and what you found (including normal findings for relevant systems)
• Clinical impression or assessment — your diagnostic reasoning
• Management plan — medications (with dose, frequency, duration), non-pharmacological advice, investigations ordered, referrals made, follow-up arrangements
• Patient education — what you discussed with the patient about their condition and management
• Safety netting — advice about when to return or seek urgent care (where applicable)

For higher-level items (36, 44), your notes must also demonstrate the additional complexity, detail, and comprehensiveness that justify the higher item number.

How AI Documentation Templates Reduce Compliance Risk

One of the most common reasons for non-compliant documentation is not that the GP failed to provide the service, but that the GP failed to document what was actually done. Time pressure is the primary culprit. When you are running 15 minutes behind and the waiting room is full, clinical notes are the first thing that gets abbreviated.

This is where MBS-aligned note templates provide significant value. Platforms like Grounded Scribe offer templates that are structured around MBS item descriptors. When you dictate or record a consultation, the AI generates a note that includes the sections required for the item number you are billing.

For example, an MBS-aligned SOAP template for Item 36 prompts the AI to ensure the generated note includes a detailed history section, documented examination findings, investigation arrangements, and a comprehensive management plan. If your dictation omits the examination, the note structure makes the gap obvious — prompting you to add the missing information before finalising.

This is not a guarantee of compliance (you must still ensure the content is accurate and complete), but it significantly reduces the risk of inadvertently producing notes that fail to demonstrate the service you provided.

Practical Recommendations

1. Document in real time or immediately after the consultation. The longer you wait, the less detail you recall. Dictation immediately after the patient leaves captures your clinical reasoning while it is fresh.

2. Use the MBS descriptor as your documentation framework. Before finalising a note, mentally check it against the descriptor for the item you are billing. Does the note demonstrate each required element?

3. Document examination findings, even normal ones. 'Chest clear bilaterally, heart sounds dual, no murmurs' takes seconds to dictate and demonstrates that you performed the examination.

4. Record outcome measure scores. For mental health items, always document the validated tool used and the score obtained. 'K10 score 28' is far more defensible than 'patient reports ongoing anxiety.'

5. Avoid copy-paste notes. PSR Committees look for templated notes that are identical across multiple patients. This suggests the documentation was not individualised and may not reflect the actual consultation.

6. Include your clinical reasoning. Where a clinical decision might be questioned — for example, prescribing an antibiotic for a presentation that might be viral — briefly document your rationale. 'Amber flag features with purulent nasal discharge for 10 days, consistent with acute bacterial sinusitis' is far more defensible than 'sinusitis, amoxicillin.'

7. Review your billing data periodically. If your Item 36 rate is significantly above the national average for your specialty and location, ensure your documentation supports it. PSR referrals are typically triggered by statistical outliers.

The Bottom Line

Medicare audit readiness is not about gaming the system or writing notes to satisfy an auditor. It is about developing documentation habits that accurately reflect the care you provide. The irony of PSR audits is that many practitioners who are found to have engaged in 'inappropriate practice' did in fact provide the services — they simply failed to document them adequately.

Investing in structured, disciplined clinical documentation is one of the most important risk management steps a GP can take. Whether you use AI-assisted tools, MBS-compliant note templates, or traditional dictation, the principle is the same: if it is not documented, it did not happen.

For more information about MBS-compliant documentation templates, visit Grounded Scribe for GPs.

Important Disclaimer

*This article is for informational purposes only and does not constitute legal, clinical, or regulatory advice. Grounded Scribe is a documentation tool — it does not provide legal guidance or ensure compliance with any specific legislative, regulatory, or registration body requirements. Practitioners are solely responsible for ensuring their documentation meets the standards of their registration board, employer, and applicable legislation. All AI-generated content must be reviewed, edited, and approved by the practitioner before it becomes part of the clinical record. For medico-legal, child protection, or tribunal documentation, always seek independent legal and professional advice relevant to your jurisdiction and specific circumstances.*

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