AustraliaPublic sector2024–2025Department of Health, Disability and Ageing
Medicare Benefits Schedule AI fraud-detection model
Australia's health department replaced a Medicare AI model after review capacity could not keep up
Problem
The department needed to identify potential fraud and serious non-compliance in Medicare provider claims. Suspected cases required manual assessment before further investigation.
Approach
The department used an AI-enabled model within its fraud-detection system from July 2024. In December 2025, it replaced that model with logistic regression to control the volume of flagged providers. The national auditor found that staff could not keep up with the potential matters generated.
Results
No published figures
Takeaway
Manual assessment capacity constrained use of the AI model. The department did not assess the costs and benefits of replacing it.
Categories
- Size
- Large enterprise
- Industry
- Public sector
- Business function
- Finance, risk and legal
- Innovation type
- Process innovation
- AI technology
- Predictive analytics and ML
- Adoption
- Built in-house
- Goal
- Quality and risk
- Evidence
- Regulator, audit or court
Sources
Source summaries
The auditor examined the department's management of AI in Medicare compliance. It found that the AI model operated from July 2024 to December 2025 before replacement, with insufficient manual assessment capacity contributing to the decision.
Full details are in the original sources.
