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2008-2009
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME BILL 2009
MIDWIFE PROFESSIONAL INDEMNITY (RUN-OFF COVER SUPPORT PAYMENT) BILL 2009
EXPLANATORY MEMORANDUM
(Circulated by the authority of the Minister for Health and Ageing,
the Hon. Nicola Roxon MP)
MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME BILL 2009
MIDWIFE PROFESSIONAL INDEMNITY (RUN-OFF COVER SUPPORT PAYMENT) BILL 2009
Introduction
The Midwife Professional Indemnity (Commonwealth Contribution) Scheme Bill
2009 and the Midwife Professional Indemnity (Run-off Cover Support Payment)
Bill 2009 give effect to the Government's new professional indemnity scheme
for certain midwives. The package was announced during the 2010 Budget by
the Government.
Professional indemnity insurance is currently not available for private
midwife practitioners in Australia. From the perspective of the insurance
industry, the two most commonly stated reasons for this are: (1) there is a
lack of accurate and up-to-date data (which is necessary for insurers to be
able to assess their actuarial liability); and (2) the potential premium
pool is very low and would currently not support a market-priced premium
level that is affordable for midwives.
The Commonwealth intends to contract with an insurer (through a national
tender process) to provide this type of insurance at an affordable price to
certain midwives. In doing so, it will also require the contracted insurer
to develop and maintain a database that the wider insurance market will be
able to use in developing longer-term products.
The insurance is intended to be available so that eligible midwives can be
appropriately covered from 1 July 2010, in line with proposed new
requirements of the National Accreditation and Registration Scheme.
The Bills create schemes in which the Commonwealth provides assistance to
insurers for the cost of the claims against eligible midwives. The
insurance product offered to eligible midwives will be required to comply
with all relevant provisions of relevant insurance law.
MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME BILL 2009
OUTLINE
The Bills provide for phase-in of Government assistance at specific cost
points for each eligible claim. This will allow the Commonwealth to assume
liability for a significant proportion of the claim, whilst still providing
a financial incentive for the eligible insurer to manage the claim in a
cost effective manner.
The Commonwealth Contribution Bill provides that the Government will pay
certain amounts for claims against an eligible midwife. In the case of
practising eligible midwives, the Bill will provide as follows.
. For each claim, the insurer will pay the first $100,000;
. For each claim over $100,000 the Government will pay 80% of the cost
that exceeds that threshold, up to a ceiling of $2 million (claims
within this $100,000 to $2 million range are referred to as Level 1
Commonwealth contribution payments); and
. For each claim that exceeds $2 million, the Government will pay at the
Level 1 rate for the first $2 million, plus 100% of the cost of the
claim above that threshold (claims above the $2 million threshold are
referred to as Level 2 Commonwealth contributions).
This Bill provides a capacity for the Government to change the $100,000
threshold, the $2 million threshold and rate of subsidy applying to both
Level 1 and Level 2 claims by Rules.
Claims may not be finalised until many years later (for cases involving
births, under various State and Territory tort law, claims may be made more
than 21 years after the incident). The contracted insurer will remain
responsible for managing and finalising claims for all notified incidents
during the period of its contract with the Commonwealth.
Examples of how the process will work are shown next. For claims notified
against an eligible midwife in the financial year beginning 1 July 2010:
. Claim 1 of $90,000 is within the $100,000 threshold, so the insurer pays
the whole claim.
. Claim 2 of $500,000 exceeds the threshold by $400,000 (and is therefore
a Level 1 Commonwealth contribution claim):
- the insurer pays the first $100,000 and 20% of the remaining $400,000;
- the Commonwealth pays 80% of $400,000;
. Claim 3 of $2,800,000 exceeds the $2 million threshold by $800,000 (and
is therefore a Level 2 Commonwealth contribution claim):
- the insurer pays the first $100,000 and 20% of $1,900,000
- the Commonwealth pays 80% of $1,900,000 and all of the remaining
$800,000 over the $2 million threshold.
For Level 1 and Level 2 Commonwealth contributions a claim will only be
paid if the claim has been certified as a qualifying claim by the Medicare
Australia CEO.
The scheme will also provide that, when a claim is made against an eligible
midwife who has ceased practice for certain reasons (e.g. retirement or
disability), the midwife's insurer will continue to provide 'run-off cover'
for that midwife. The Commonwealth will make a contribution to the insurer
for amounts the insurer is liable to pay under that cover. The
Commonwealth's contribution will be partly funded through a levy on the
relevant insurer's premium income for providing insurance cover to eligible
midwives.
Broadly, the scheme provides for apportionment where a claim has been made
in relation to the same incident which involves a person other than the
midwife or the eligible insurer. The Medicare Australia CEO will issue
apportionment certificates which set out how a claim should be apportioned
between the midwife and the other person or persons having regard to
information provided by the applicant and other relevant information.
The Bill will not cover any incident that occurs before 1 July 2010.
Overseas practice will not be covered either.
The Midwife Professional Indemnity (Run-off Cover Support Payment) Bill
2009 imposes the run-off cover support payment as a levy on insurers by
reference to their premium income.
MIDWIFE PROFESSIONAL INDEMNITY (RUN-OFF COVER SUPPORT PAYMENT) BILL 2009
OUTLINE
Under the run-off cover scheme eligible midwives claims will be paid out by
the Australian Government and the cost of this scheme will be funded by a
levy on eligible insurers.
This Bill imposes the run-off cover support payment as a levy on insurers
by reference to their midwife professional indemnity premium income.
Financial impact statement
The measures that these Bills will enable (including through delegated
legislation), have a total cost of $25.2million over four years. The
budgeted annual costs, which include administrative and Department of
Health and Ageing costs, and administrative costs for Medicare Australia to
introduce the necessary systems changes and manage the program, are set out
in the table below:
|2009-10 |2010-11 |2011-12 |2012-13 |Total |
|($ million) |($ million) |($ million) |($ million) |($ million) |
|$4.7 |$8.1 |$4.4 |$7.9 |$25.2 |
MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME BILL 2009
NOTES ON CLAUSES
General note on the use of Rules
A number of provisions in the Bill provide for certain things to be
specified in Rules made by the Minister. This is so that aspects of the
Midwife Professional Indemnity (Commonwealth Contribution) Scheme can be
readily and speedily modified if required. Any Rules will be legislative
instruments, subject to the requirements of the Legislative Instruments Act
2003, and in particular may be subject to disallowance.
Chapter 1-Introduction
Part 1-Preliminary
Division 1-Preliminary
Clause 1 Short title
This clause sets out the short title of the Bill, once enacted.
Clause 2 Commencement
This clause sets out that the Bill, once enacted, will commence on 1 July
2010.
Division 2-Objects and Guide
Clause 3 Objects of this Act and the Commonwealth contribution legislation
This clause sets out the Objects of this Bill, including providing
Commonwealth assistance to support access by eligible midwives to
professional indemnity arrangements. This assistance is provided by
meeting part of the costs of certain large claims, and meeting the costs of
certain claims for midwives no longer in private practice.
Clause 4 Guide to this Act
This clause describes the chapters in the Bill.
Division 3-Definitions
Clause 5 Definitions
This clause defines terms used in the Bill, or indicates where else in the
Bill terms are defined.
Division 4-Other general matters
Clause 6 External Territories
This clause provides that the Bill extends to the external Territories.
Clause 7 Rules may set termination dates
This clause provides that the Rules may set:
. a Level 1 termination date;
. a Level 2 termination date;
. a run-off cover termination date.
Chapter 2-Midwife Professional Indemnity Commonwealth Contributions
Part 1-Guide to this Chapter
Clause 8 Guide to this Chapter
This clause provides that Chapter 2 is about midwife professional indemnity
Commonwealth contributions. Part 2 deals with Level 1 and Level 2
Commonwealth contributions. Part 3 deals with run-off cover Commonwealth
contributions. Part 4 deals with the administration of these schemes.
Part 2-Level 1 and Level 2 Commonwealth contributions
Division 1-Preliminary
Clause 9 Guide to the Level 1 and Level 2 Commonwealth contribution
provisions
This clause sets out a guide to Level 1 and Level 2 Commonwealth
contribution provisions.
Subclause (1) provides that a Level 1 Commonwealth contribution may be paid
to an eligible insurer that pays more than a particular amount on a claim
that arises from the practice by the person as an eligible midwife. This
claim must be certified as a qualifying claim before a payment can be made.
Subclause (2) provides that a Level 2 Commonwealth contribution may be paid
in relation to a liability of a midwife if:
. the liability relates to a claim against the midwife in relation to an
incident that occurs in the course of, or in connection with, the
practice by the person as an eligible midwife, and the claim has been
certified as a qualifying claim; and
. the liability exceeds the amount payable under an insurance contract
that limits the insurer's liability under the contract. The limit of
the insurer's liability must equal or exceed the Level 2 claim threshold
set in subclause 10(2).
Subclause (3) sets out where in the Division particular provisions may be
found.
Clause 10 Level 1 and Level 2 claim thresholds
This clause sets the Level 1 and Level 2 threshold in the following terms:
. the Level 1 threshold is $100,000, or such other amount as is specified
in the Rules;
. the Level 2 threshold is $2 million, or such other amount as is
specified in the Rules.
The Note explains that claims cannot be aggregated, so each claim must
individually reach each threshold before Commonwealth contribution
commences.
A variation to the threshold in the Rules only applies to a contract of
insurance entered into or renewed after the Rule takes effect. This
will be the date on which the Rules are registered on the Federal
Register of Legislative Instruments or a later day specified in the
Rules.
Division 2-Certification
Clause 11 When may the Medicare Australia CEO certify a claim as a
qualifying claim?
A person will only be entitled to a payment of a Level 1 or Level 2
Commonwealth contribution where a qualifying claims certificate is in force
in relation to the claim. This clause sets out the criteria that must be
met before the Medicare Australia CEO can issue a qualifying claim
certificate.
Subclause (1) provides that the Medicare Australia CEO may issue a
certificate that a claim is a Level 1 qualifying claim if the Medicare
Australia CEO is satisfied that the criteria set out in subclause (3) has
been satisfied, and a person has applied for a Level 1 qualifying claim
certificate in relation to the claim in accordance with clause 12.
Subclause (2) provides that the Medicare Australia CEO may issue a
certificate that a claim is a Level 2 qualifying claim if the Medicare
Australia CEO is satisfied that the common requirements set out in
subclause (3) have been satisfied, the claim meets the additional Level 2
requirements set out in subclause (4), and a person has applied for a Level
2 qualifying claim certificate in relation to the claim in accordance with
clause 12.
Subclause (3) sets out the common requirements that a Level 1 or Level 2
claim must meet before a qualifying certificate can be issued. These
requirements are:
. the claim is or was made against a person (the midwife); and
. the claim relates to an incident that occurs or occurred in the course
of, or in connection with, the midwife's practice as an eligible
midwife; and
. except if specified in the Rules, the incident occurs or occurred in
Australia or an external Territory; and
. the incident did not occur in the course of, or in connection with,
treating public patients of a hospital; and
. the claim does not relate to an incident for which the Commonwealth, a
State or a Territory, or local governing body or, an authority
established under a law of the Commonwealth, a State or a Territory,
indemnifies eligible midwives from liability relating to compensation;
and
. the claim does not relate to an incident which is indemnified, or would
in the ordinary course of business be indemnified from liability by the
midwife's employer; and
. for a Level 1 qualifying claim certificate-the incident occurs or
occurred on or after 1 July 2010, and on or before the Level 1
termination date (if any); and
. for a Level 2 qualifying claim certificate-the incident occurs or
occurred on or after 1 July 2010, and on or before the Level 2
termination date (if any); and
. the claim is not in substance an aggregation of two or more separate
claims; and
. the claim is not a claim of a class specified in the Rules; and
. the claim does not relate to an incident of a kind specified in Rules;
and
. the claim does not relate to a type of midwifery practice specified in
Rules.
An example of an incident that would, in the ordinary course of
business, be indemnified by an employer would be an incident that occurs
while a midwife is continuing a prior employment relationship which has
changed only in the aspect of the employer no longer paying for the
midwife's professional indemnity insurance. This exclusion ensures
consistency in meeting the Commonwealth's outcomes.
Subclause (4) sets out the following additional requirements for Level 2
qualifying claim certificates:
. there is a contract of insurance entered into by an eligible insurer in
relation to which the following requirements are met:
- the contract provides cover for the midwife in relation to the claim, or
but for the limit on the eligible insurer's liability it would cover the
midwife in relation to the claim;
- the limit on the eligible insurer's liability under the contract equals
or exceeds the Level 2 threshold for the claim against the midwife;
- the eligible insurer is a general insurer within the meaning of the
Insurance Act 1973;
- the eligible insurer entered into the contract in the ordinary course of
the insurer's business; and
. the contract of insurance is not a contract of a class specified in the
Rules.
When a certificate is in force
Subclause (5) provides that the certificate comes into force when it is
issued and remains in force until it is revoked. These actions are
undertaken by the Medicare Australia CEO.
Matters to be identified or specified in certificate
Subclause (6) provides that the certificate must:
. identify the midwife, the claim, and if the certificate is a Level 2
qualifying certificate, the contract of insurance in relation to which
paragraph (4)(a) is satisfied; and
. specify the relevant threshold; and
. the certificate may also contain other material.
AAT review of decision to refuse
Subclause (7) provides that an application may be made to the
Administrative Appeals Tribunal for review of a decision of the Medicare
Australia CEO to refuse to issue a qualifying claim certificate. The note
explains that section 27A of the
Administrative Appeals Tribunal Act 1975 requires notification of a
decision that is reviewable.
Medicare Australia CEO to give applicant copy of certificate
Subclause (8) provides that if the Medicare Australia CEO decides to issue
a qualifying claim certificate, the Medicare Australia CEO must, within 28
days of making his or her decision, unless it is not reasonably practicable
to do so, give the applicant a copy of the certificate. However, a failure
to comply does not affect the validity of the decision.
Subclause (9) provides that a qualifying claim certificate is not a
legislative instrument. This provision has been included to assist the
reader, as the instrument would not be a legislative instrument within the
meaning of section 5 of the Legislative Instruments Act 2003.
Clause 12 Application for a qualifying claim certificate
This clause sets out how an application for a qualifying claim certificate
must be made.
Subclause (1) provides that an application for the issue of a Level 1
qualifying claim certificate may be made by an eligible insurer.
Subclause (2) provides that an application for the issue of a Level 2
qualifying claim certificate may be made by an eligible insurer, or the
person against whom the claim is or was made, or by a person acting on that
person's behalf. The person against whom the claim is made is the midwife.
Subclause (3) provides that the application must:
. be made in writing using a form approved by the Medicare Australia CEO;
and
. specify whether it is an application for a Level 1 qualifying claim
certificate or a Level 2 qualifying claim certificate; and
. specify each person, other than the midwife concerned, against whom a
claim has been or is reasonably likely to be made, in relation to the
incident to which the claim relates; and
. be accompanied by the documents and other information required by the
form approved by the Medicare Australia CEO.
Clause 13 Time by which an application must be decided
This clause sets out when an application for a qualifying certificate must
be decided by.
Subclause (1) provides that, subject to subclause (2), the Medicare
Australia CEO is to decide an application for the issue of a qualifying
claim certificate on or before the 21st day after the day on which the
application is received by the Medicare Australia CEO.
Subclause (2) provides that, if the Medicare Australia CEO requests a
person to give information under clause 62 in relation to the application,
the Medicare Australia CEO does not have to decide the application until
the 21st day after the day on which the person gives the information to the
Medicare Australia CEO.
Clause 14 Obligation to notify the Medicare Australia CEO if information
is incorrect or incomplete
This clause requires the Medicare Australia CEO to be notified of incorrect
or incomplete information in relation to qualifying claim certificates that
have been issued.
Subclause (1) provides that, if:
. a qualifying claim certificate is in force in relation to a claim; and
. a person becomes aware that the information provided to the Medicare
Australia CEO in connection with the application for the certificate was
incorrect or incomplete, or is no longer correct or complete; and
. the person is:
- the person who applied for the certificate; or
- another person who has applied for a payment of Level 1 or Level 2
Commonwealth contribution in relation to the claim;
the person must notify the Medicare Australia CEO of the respect in which
the information was incorrect or incomplete, or is no longer correct or
complete.
The note explains that failure to notify is an offence (see clause 67).
Subclause (2) provides that the notification must:
. be made in writing (paragraph (a)); and
. be given to the Medicare Australia CEO within 28 days after the person
becomes aware as mentioned in subclause (1) (paragraph (b)).
Clause 15 Revocation and variation of qualifying claim certificates
This clause gives the Medicare Australia CEO the power to revoke or vary a
qualifying claim certificate.
Revocation
Subclause (1) provides that the Medicare Australia CEO may revoke a
qualifying claim certificate if the Medicare Australia CEO is no longer
satisfied as mentioned in subclauses 11(1) or (2) in relation to the claim.
Subclause (2) provides that, to avoid doubt, in considering whether he
or she is still satisfied as mentioned in subclauses 11(1) or (2) in
relation to the claim, the Medicare Australia CEO may have regard to
matters that have occurred since the decision to issue the qualifying
claim certificate was made, including for example:
. the making of Rules; or
. changes to the terms and conditions of the contract of insurance
identified in the certificate.
Variation
Subclause (3) provides that, if the Medicare Australia CEO is satisfied
that a matter is not correctly identified or specified in a qualifying
claim certificate, the Medicare Australia CEO may vary the certificate so
that it correctly identifies or specifies the matter.
Effect of revocation
Subclause (4) provides that, if:
. the Medicare Australia CEO revokes a qualifying claim certificate; and
. an amount of Level 1 or Level 2 Commonwealth contribution has already
been paid in relation to the claim and that amount exceeds the amount
that would have been paid if the amount had been determined having
regard to the certificate as varied;
the amount is an amount overpaid to which clause 64 applies (the
recovery of overpayments).
Effect of variation
Subclause (5) provides that, if:
. the Medicare Australia CEO varies a qualifying claim certificate; and
. an amount of Level 1 or Level 2 Commonwealth contribution has already
been paid in relation to the claim, and that amount exceeds the amount
that would have been paid if the amount of indemnity had been determined
having regard to the certificate as varied;
the amount of the excess is an amount overpaid to which clause 64 applies
(the recovery of overpayments).
AAT review of decision to revoke or vary
Subclause (6) provides that an application may be made to the
Administrative Appeals Tribunal for review of a decision of the Medicare
Australia CEO to revoke or vary a qualifying claim certificate.
The note explains that section 27A of the Administrative Appeals
Tribunal Act 1975 requires notification of a decision that is
reviewable.
Medicare Australia CEO to give applicant copy of varied certificate
Subclause (7) provides that if the Medicare Australia CEO decides to vary a
qualifying claim certificate, the Medicare Australia CEO must, within 28
days of making the decision, give the applicant a copy of the varied
certificate. However, a failure to comply does not affect the validity of
the decision.
Division 3-Payability
Subdivision A-Level 1 payability
Clause 16 When is a Level 1 Commonwealth contribution payable?
This clause sets out the circumstances when a Level 1 Commonwealth
contribution will be payable.
Basic payability rule
Subclause (1) provides that a Level 1 Commonwealth contribution is payable
to an eligible insurer if:
. a claim (the current claim) is or was, made against a person (the
midwife); and
. a Level 1 qualifying claim certificate is in force in relation to the
current claim; and
. an apportionment certificate has been issued, if applicable, or an
apportionment certificate has not been issued because of the operation
of clause 52 (which deals with the claims for which there is a final
judgement or order of a court); and
. the insurer has a qualifying payment (as defined in subclause (3)); and
. the amount of the qualifying payment exceeds the Level 1 claim threshold
at the time the eligible insurer was first notified of the claim or
incident; and
. a person has applied for the Level 1 Commonwealth contribution; and
. any other requirements specified in the Rules are met; and
. the current claim is not a claim included in a class specified in Rules.
Subclause (2) provides that the Rules made for the purposes of this clause
do not apply to an incident if the claim relating to that incident was made
before the Rules take effect.
Qualifying payments
Subclause (3) provides that an eligible insurer has a qualifying payment if
the insurer:
. pays an amount in relation to the claim or is liable to pay an amount
under a written agreement or court order or judgment not stayed or
subject to appeal; and
. pays, or is liable to pay, the amount under an insurance contract with
the midwife; and
. pays, or becomes liable to pay, the amount in the ordinary course of the
insurer's business; and
. the amount paid or payable is consistent with the amount specified in an
apportionment certificate, if applicable.
Clause 17 Amount of Level 1 Commonwealth contribution
This clause sets the amount of the Level 1 Commonwealth contribution as 80%
(or such other percentage as is specified in the Rules) of the amount by
which the eligible insurer's qualifying payments exceed the Level 1 claim
threshold (but does not exceed the Level 2 claim threshold).
Subdivision B-Level 2 payability
Clause 18 When is a Level 2 Commonwealth contribution payable?
This clause sets out the circumstances when a Level 2 Commonwealth
contribution is payable.
Basic Payability Rule
Subclause (1) provides that the Medicare CEO may determine that a Level 2
Commonwealth contribution is payable in relation to a liability of a person
(the midwife) if:
. a claim for compensation or damages (the current claim) is, or was, made
against the midwife by another person; and
. a Level 2 qualifying claim certificate is in force in relation to the
current claim; and
. the liability is a qualifying liability of the midwife in relation to
the current claim (see clause 19); and
. the Medicare CEO has issued an apportionment certificate in relation to
the claim, if applicable, or an apportionment certificate has not been
issued because of the operation of clause 52 (which deals with the
claims for which there is a final judgement or order of a court); and
. because of the limit of the insurer's liability in relation to the
contract of insurance identified in the qualifying claim certificate,
the contract does not cover, or does not fully cover, the liability; and
. the amount that, if the limit had been high enough to cover the whole of
the liability, the insurer would (subject to the other terms and
conditions of the contract) have been liable to pay under the contract
of insurance in relation to the liability exceeds the actual amount (if
any) that the insurer has paid or is liable to pay under the contract in
relation to the liability; and
. the amount that the insurer has paid, or is liable to pay, under the
contract (including in relation to the claim); and
. the amount (if any) the eligible insurer has paid, or is liable to pay,
under the contract equals or exceeds the Level 2 threshold identified in
the qualifying claim certificate; and
. a person has applied for the Level 2 Commonwealth contribution in
accordance with clause 60; and
. the claim is not a claim included in a class specified in Rules.
The notes explain the interactions with other clauses and that payments and
liabilities to pay must meet the ordinary course of business requirement
set out in subclause (3).
Who the contribution is payable to
Subclause (2) provides that the contribution is to be paid to the person
who applies for it.
The note points out that clause 60 provides details on who can apply.
Ordinary course of business test for insurance payments
Subclause (3) provides that an amount that an eligible insurer has paid, or
is liable to pay, under the contract does not count for the purpose of
subparagraph (1)(g)(i) or (ii), unless it is an amount that the insurer
paid, or is liable to pay, in the ordinary course of the insurer's
business.
AAT review of decision to refuse, or to pay a particular amount of
contribution
Subclause (4) provides that an application may be made to the
Administrative Appeals Tribunal for review of a decision of the Medicare
Australia CEO to refuse an application for Level 2 Commonwealth
contribution, or to pay a particular amount of Level 2 Commonwealth
contribution.
The note explains that section 27A of the Administrative Appeals Tribunal
Act 1975 requires notification of a decision that is reviewable.
Clause 19 Qualifying liabilities
A Level 2 Commonwealth contribution will only be payable if the liability
is a qualifying liability in relation to the claim (see paragraph
18(1)(c)). This clause sets out the criteria of a qualifying liability.
Subclause (1) provides that a person (the midwife) has a qualifying
liability in relation to a claim made against the person if:
. one of the following applies:
- the liability is under a judgment or order of a court in relation to the
claim, being a judgment or order that is not stayed and is not subject
to appeal;
- the liability is under a settlement of the claim that takes the form of
a written agreement between the parties to the claim;
- the liability is some other kind of liability of the midwife (for
example, a liability to legal costs) that relates to the claim; and
. the defence of the claim against the midwife was conducted appropriately
(see subclause (2)) up to the time when:
- if the liability is under a judgment or order of a court-the date on
which the judgment or order became a judgment or order that is not
stayed and is not subject to appeal; or
- if the liability is under a settlement of the claim-the date on which
the settlement agreement was entered into; or
- if the liability is some other kind of liability-the date on which the
liability was incurred; and
. if the liability is under a settlement of the claim, or is under a
consent order made by a court-a legal practitioner has given a statutory
declaration certifying that the amount of the liability is reasonable;
and
. the amount paid or payable is consistent with an apportionment
certificate that is in force in relation to the claim, if applicable.
Subclause (2) provides that, for the purposes of paragraph (1)(b), the
defence of the claim is conducted appropriately if, and only if:
. to the extent it is conducted on the midwife's behalf by an insurer, or
by a legal practitioner engaged by the insurer-the defence is conducted
to a standard that is consistent with the insurer's usual standard for
the conduct of the defence of claims; and
. to the extent it is conducted by the midwife, or by a legal practitioner
engaged by the midwife-the defence is conducted prudently.
Subclause (3) defines defence of the claim to include any settlement
negotiations on behalf of the midwife.
Clause 20 Interaction with Level 1 Commonwealth contribution and run-off
cover
The clause provides that for the purposes of determining the limit of the
eligible insurer's liability under the contract of insurance and paragraphs
18(1)(e) and (f), an amount paid or payable under a contract of insurance
is not to be reduced on account of a Level 1 Commonwealth contribution, or
a run-off cover Commonwealth contribution, paid or payable to the eligible
insurer.
Clause 21 Amount of Level 2 Commonwealth contribution
This clause provides that the amount of Level 2 Commonwealth contribution
that is payable in relation to a particular qualifying liability is the
amount of the excess referred to in paragraph 18(1)(e).
The note explains that it is only liabilities that exceed the limit will be
covered by a Level 2 Commonwealth contribution (even if the Level 2 claim
threshold is less than that limit).
Clause 22 How Level 2 Commonwealth contribution is to be applied
Subclause (1) provides that this clause applies if a Level 2 Commonwealth
contribution (the contribution) is paid to a person (the recipient) in
relation to a liability of a person (the midwife).
The note explains that the recipient will either be the midwife himself or
herself, or a person acting on behalf of the midwife.
Medicare Australia CEO to give recipient of payment a notice identifying
the liability to be discharged
Subclause (2) provides that the Medicare Australia CEO must give the
recipient a written notice (the payment notice) identifying the liability
in relation to which the contribution is paid, and advising the recipient
how this clause requires the contribution to be dealt with.
Recipient's obligation if the amount of the contribution equals or is less
than the liability
Subclause (3) provides that if the amount of the contribution equals or is
less than the undischarged amount of the liability identified in the
payment notice, the recipient must apply the whole of the contribution
towards the discharge of the liability.
Recipient's obligation if the amount of the contribution exceeds the
liability
Subclause (4) provides that if the amount of the contribution is greater
than the undischarged amount of the liability identified in the payment
notice, the recipient must:
. apply so much of the contribution as equals the undischarged amount of
the liability towards the discharge of the liability; and
. if the recipient is not the midwife-deal with the balance of the
contribution in accordance with the directions of the midwife.
Time by which recipient must comply with obligation
Subclause (5) provides that the recipient must comply with whichever of
subclauses (3) and (4) applies:
. by the time specified in a written direction (whether contained in the
payment notice or otherwise) given to the recipient by the Medicare
Australia CEO; or
. if no such direction is given to the recipient-as soon as practicable
after the Commonwealth contribution is received by the recipient.
To avoid doubt, the Medicare Australia CEO may vary a notice under
paragraph (a) to specify a different time.
Debt to Commonwealth if recipient does not comply with obligation on time
Subclause (6) provides that if the recipient does not comply with whichever
of subclauses (3) and (4) which applies by the time required by subclause
(5), the amount of the contribution is a debt due to the Commonwealth.
Subclause (7) provides that the debt may be recovered:
. by action by the Medicare Australia CEO against the recipient in a court
of competent jurisdiction; or
. under clause 65.
Subclause (8) provides that if the amount of the contribution is
recoverable, or has been recovered, under subclause (7), no amount is
recoverable under clause 25 or clause 64 in relation to the same payment of
contribution.
Clause 23 Who is liable to repay an overpayment of Level 2 Commonwealth
contribution?
Subclause (1) provides that this clause applies, in relation to a Level 2
Commonwealth contribution that has been paid, if there is an amount
overpaid as described in subclause 25(2) or 64(2).
Subclause (2) provides that the liable person, in relation to the amount
overpaid, is:
. if the contribution has not been dealt with in accordance with whichever
of subclauses 22(3) and (4) applies-the recipient referred to in
subclause 22(1); or
. if the contribution has been dealt with in accordance with whichever of
those subclauses applies-the midwife referred to in subclause 22(1).
The note explains that the recipient and the midwife will be the same
person if the contribution was paid to the midwife.
Subclause (3) provides that if:
. the recipient and the midwife referred to in subclause 22(1) are not the
same person; and
. when the overpayment is recovered as a debt, the liable person is the
recipient;
the fact the recipient may later deal with the remainder of the
contribution in accordance with subclause 22(3) or (4) does not mean that
the overpayment should instead have been recovered from the midwife.
Subdivision C-Payments that would have reduced the amount paid out under
the contract of insurance
Clause 24 Amounts paid before payment of Level 2 Commonwealth contribution
Clause 24 provides for amounts, which reduce the amount that an insurer
would pay for a claim, to be taken into account to reduce the amount of
Level 2 Commonwealth contribution paid to the insurer.
Subclause (2) provides that this clause does not apply to any of the
following:
. an amount paid to an insurer by another insurer under a right of
contribution;
. a payment of Level 1 Commonwealth contribution;
. a payment of run-off cover Commonwealth contribution;
. an amount of a kind specified in the Rules for the purposes of this
paragraph.
Clause 25 Amounts paid after payment of Level 2 Commonwealth contribution
This clause deals with circumstances when another payment is made in
relation to a claim where Level 2 Commonwealth contribution has already
been made, and that other payment is not taken into account when
calculating the Level 2 Commonwealth contribution. If the other payment
had been taken into account and this would have reduced the Level 2
Commonwealth contribution payable, an overpayment arises which becomes a
debt owed to the Commonwealth.
Subclause (1) provides that this provision applies if:
. an amount (the actual contribution amount) of Level 2 Commonwealth
contribution has been paid in relation to a qualifying liability that
relates to a claim made against a person (the midwife); and
. another amount (not being an amount referred to in subclause (5)) is
paid to the midwife, an eligible insurer or another person in relation
to the incident to which the claim relates; and
. the other amount was not taken into account in calculating the actual
contribution amount; and
. if the other amount had been so taken into account-a lesser amount (the
reduced contribution amount, which could be zero) of Level 2
Commonwealth contribution would have been paid in relation to the
liability.
Subclause (2) provides that the amount overpaid is the amount by which the
actual contribution amount exceeds the reduced contribution amount.
Subclause (3) provides that if the Medicare Australia CEO has given the
liable person (the recipient or midwife outlined in subclause 23(2)) a
notice under clause 27(1) in relation to the amount overpaid, the amount is
a debt owed to the Commonwealth by the liable person.
Note 1 explains that, if the contribution is or was not dealt with in
accordance with whichever of subclauses 22(3) and (4) applies by the time
required by subclause 22(5), the whole amount of the contribution is a debt
owed by the recipient, and no amount is recoverable under this clause (see
subclauses 22(6) to (8)).
Note 2 explains that if:
. the recipient and the midwife referred to in subclause 22(1) are not the
same person; and
. the midwife becomes the liable person;
then, subject to subclause 22(3), the recipient ceases to be the liable
person, and the amount overpaid must instead be recovered from the
midwife.
Subclause (4) provides that the amount overpaid may be recovered:
. by action by the Medicare Australia CEO against the liable person in a
court of competent jurisdiction; or
. under clause 65.
Subclause (5) provides that this new clause does not apply to any of the
following:
. an amount paid to an eligible insurer by another insurer under a right
of contribution;
. a payment of Level 1 Commonwealth contribution;
. a payment of run-off cover Commonwealth contribution;
. an amount of a kind specified in the Rules.
Clause 26 Obligation to notify the Medicare Australia CEO that amount has
been paid
Subclause (1) provides that if:
. an amount of Level 2 Commonwealth contribution has been paid in relation
to a qualifying liability that relates to a claim made against a person
(the midwife) (paragraph (a)); and
. the person (the applicant) who applied for the or Level 2 Commonwealth
contribution becomes aware that another amount has been paid to the
midwife, an insurer or another person in relation to the incident or
incidents to which the claim relates, or in relation to one or more
other incidents (paragraph (b)); and
. because of the payment of the other amount, there is an amount overpaid
as described in subclause 25(2) (paragraph (c));
the applicant must notify the Medicare Australia CEO that the other amount
has been paid.
The note provides that failure to notify is an offence (see clause 67).
Subclause (2) provides that the notification must:
. be in writing (paragraph (a)); and
. be given to the Medicare Australia CEO within 28 days after the
applicant becomes aware that the other amount has been paid (paragraph
(b)).
Clause 27 The Medicare Australia CEO to notify of amount of debt due
This provision gives the Medicare Australia CEO the power to send a notice
in circumstances where an overpayment is made. The notice lets the
recipient know that the overpayment is a debt owed to the Commonwealth and
when it must be paid.
Subclause (1) provides that if:
. an amount of Level 2 Commonwealth contribution has been paid in relation
to a qualifying liability that relates to a claim made against a person
(the midwife) (paragraph (a)); and
. another amount is paid to the midwife, an insurer or another person in
relation to the incident or incidents to which the claim relates, or in
relation to one or more other incidents (paragraph (b)); and
. because of the payment of the other amount, there is an amount overpaid
as described in subclause 25(2) (paragraph (c));
the Medicare Australia CEO may give the liable person (see subclause
23(2)) a written notice that specifies:
. the amount overpaid, and that it is a debt owed to the Commonwealth
under subclause 25(3); and
. the day before which the amount must be paid to the Commonwealth; and
. the effect of clause 28.
The day specified under paragraph (e) must be at least 28 days after the
day on which the notice is given.
Subclause (2) provides that the debt becomes due and payable on the day
specified under paragraph (1)(e).
Clause 28 Penalty imposed if an amount is repaid late
This clause sets out when a person may be liable to pay a penalty for late
repayment of a debt, and how that penalty is calculated.
Subclause (1) provides that if:
. a person owes a debt to the Commonwealth under subclause 25(3); and
. the debt remains wholly or partly unpaid after it becomes due and
payable;
the person is liable to pay a late payment penalty under this clause.
Subclause (2) provides that the late payment penalty is calculated:
. at the rate specified in the Rules; and
. on the unpaid amount; and
. for the period:
- starting when the amount becomes due and payable; and
- ending when the amount and the penalty payable under this clause in
relation to the amount have been paid in full.
A Rule is required to set a rate at which late payment penalty is
calculated.
Subclause (3) provides that the Medicare Australia CEO may remit the whole
or a part of an amount of late payment penalty if the Medicare Australia
CEO considers that there are good reasons for doing so.
Subclause (4) provides that an application may be made to the
Administrative Appeals Tribunal for review of a decision of the Medicare
Australia CEO not to remit, or to remit only part of, an amount of late
payment penalty.
The note explains that section 27A of the Administrative Appeals Tribunal
Act 1975 requires notification of a decision that is reviewable.
Subclause (5) provides that if:
. the recipient and the midwife referred to in subclause 22(1) are not the
same person; and
. the midwife becomes the liable person; and
. the recipient has or had a liability under this clause to pay late
payment penalty;
the recipient's liability to the late payment penalty is not affected by
the fact that the recipient is no longer the person who owes the debt to
the Commonwealth under subclause 25(3), except that the period referred to
in paragraph (2)(c) ends when the midwife becomes the liable person.
Part 3-Run-off cover Commonwealth contributions
Division 1-Introduction
Clause 29 Guide to run-off cover Commonwealth contributions
This guide outlines that this Division provides for a run-off cover
Commonwealth contribution to be paid in relation to a liability of an
eligible midwife if the liability relates to an eligible run-off claim. A
table is also included which outlines where to find the provisions dealing
with various issues.
Clause 31 Eligible run-off claims
This clause sets out the criteria that must be satisfied before a claim
will be an eligible run-off claim.
Subclause (1) sets out the following criteria that must be met for a claim
to be an eligible run-off claim:
. the claim is made against a person who, at the time the claim is made,
is a person to whom subclause (2) applies;
. it relates to incident that occurred on or after 1 July 2010 and on or
before the run-off cover termination date in the course of, or in
connection with, the person's practice as an eligible midwife;
. in the event that the scheme is terminated, a person already eligible
for the scheme would continue to have their claims covered by the
terminated scheme until they cease to be eligible. A person who would
have become eligible after the termination date (if the scheme had not
been terminated) would not become eligible;
. the person has midwife professional indemnity run-off cover that
indemnifies the person in relation to the claim.
Subclause (2) provides for who will be covered by the scheme. Some
midwives will be eligible for the scheme permanently (until their estate
is wound up) and others will be eligible temporarily - they are taken to
have left the scheme when they no longer meet the eligibility criteria
(for example, they return to private practice).
In general terms, the following midwifes will be covered by the scheme:
. retirees over 65;
. a person who has not engaged in private practice as an eligible midwife
for three years;
. midwives on maternity leave;
. midwives who no longer practice because of permanent disability;
. the legal representative of a deceased midwife's estate; and
. midwives included by the Rules.
Classes of persons may be excluded by the Rules.
Subclause (3) provides that a person is taken to have ceased the
person's practice as a midwife because of maternity if and only if:
. the person is pregnant, or has given birth, or is recovering from a
pregnancy (including a miscarriage or a stillbirth); and
. another person who is a medical practitioner has certified, in the form
approved by the Medicare Australia CEO, that the person is pregnant, has
given birth or is recovering from a pregnancy;
. the person has ceased all practice as a eligible midwife because
- she is pregnant or
- in order to care for the child/ren to whom she has given birth or
- in order to recover from the pregnancy; and
. any other requirements specified in the Rules have been met.
Subclause (4) provides that a person is taken to have ceased the
person's practice as a midwife because of a permanent disability if and
only if:
. the person has incurred an injury, or suffers from an illness, that is
permanent or is likely to be permanent; and
. as a result of the injury or illness, the person can no longer practise
the profession of midwifery; and
. another person who is a medical practitioner has certified that the
person is has incurred an injury or suffers from an illness that is
permanent or is likely to be permanent and can no longer practise as an
eligible midwife; and
. the person has permanently ceased all practice as an eligible midwife.
Subclause (5) defines, for the purposes of clause 31, private practice as a
midwife to mean practice as a midwife other than:
. practice consisting of treatment of public patients of a public
hospital; or
. practice for which the Commonwealth, a State or a Territory, or a local
governing body, or an authority established under a law of the
Commonwealth, a State or a Territory indemnifies eligible midwives from
liability relating to compensation; or
. practice indemnified from liability relating to compensation by the
midwife's employer; or
. practice conducted outside both Australia and the external Territories;
or
. practice of a kind specified in the Rules.
Division 2-Run-off cover Commonwealth contributions
Clause 32 Circumstances in which run-off cover Commonwealth contributions
are payable
This clause sets out the circumstances when Commonwealth run-off cover
contributions are payable.
Subclause (1) provides that a Commonwealth run-off cover contribution is
payable to an eligible insurer for an eligible run-off claim if:
. the claim relates to an incident that occurred in the course of or in
connection with a person's practice as an eligible midwife; and
. at the time the claim is first notified to the eligible insurer, the
person is a person to whom subclause 31(2) applies; and
. the Medicare CEO has issued an apportionment certificate in relation to
the claim, if applicable, or has not issued an apportionment certificate
because of the operation of clause 52; and
. the eligible insurer would pay under contract while the person is
eligible under clause 31(2); and
. the incident occurs, or occurred, on or after 1 July 2010 and on or
before any run-off cover termination date; and
. the eligible insurer applies to the Medicare Australia CEO for the
Commonwealth run-off cover contribution in accordance with clause 58;
and
. the payment is consistent the terms of an apportionment certificate, if
applicable.
Subclause (2) provides that paragraph (1)(d) does not apply to a payment
that an eligible insurer makes, or is liable to make, unless the payment is
or would be made:
. in relation to a claim made in relation to which the midwife concerned
has midwife professional indemnity run-off cover; and
. in the eligible insurer's ordinary course of business.
Clause 33 Clarification of circumstances in which run-off cover
Commonwealth contributions are payable
This clause provides for a run-off cover Commonwealth contribution to be
payable even if the claim is covered by reinsurance or the eligible insurer
has paid an amount by an insurer in relation to the payment.
Clause 34 Exceptions
This clause provides that a run-off cover Commonwealth contribution is not
payable to an eligible insurer if the payment is an insurer-to-insurer
payment or the payment is a payment prescribed by the Rules for the
purposes of this clause.
Clause 35 Amount of run-off cover Commonwealth contribution
The effect of this clause is that the amount of a run-off cover
contribution is the amount of the payment referred to in paragraph
32(1)(d), but only to the extent the payment is or would be made: in
relation to a claim for which the midwife has run-off cover, and in the
eligible insurer's ordinary course of business.
Subclause (2) provides that if a run-off cover Commonwealth contribution is
paid, the claim is first funded by the relevant Level 1 Commonwealth
contribution or Level 2 Commonwealth contribution (or both), then any
amount of the Commonwealth contribution in excess of the Level 2 threshold
is funded by the run-off cover Commonwealth contribution. This makes
better use of the funding that is sourced from the run-off cover scheme,
and therefore minimises the tax that would have to be imposed through the
Midwife Professional Indemnity (Run-off Cover Support Payment) Bill 2009.
Division 3-Payments that would have reduced the amount of run-off cover
Commonwealth contribution
Clause 36 Amounts paid before run-off cover Commonwealth contribution
Clause 36 provides for amounts which reduce the amount that an insurer
would pay for a claim to be taken into account to reduce the amount of run-
off cover Commonwealth contribution paid to the insurer.
This clause does not apply to:
. an amount paid to an eligible insurer under a right of contribution;
. a payment of Level 1 Commonwealth contribution;
. a payment of Level 2 Commonwealth contribution; and
. an amount of a kind specified in the Rules for the purposes of this
paragraph.
Clause 37 Amounts paid after payment of run-off cover Commonwealth
contribution
Clause 37 deals with amounts paid after payment of a run-off cover
contribution, that (if taken into account) would have reduced the amount of
run-off cover contribution that would have been payable. If the payment of
those amounts means that run-off cover contribution has been overpaid, and
the Medicare CEO notifies the eligible insurer of this, the insurer will
owe the overpaid amount as a debt to the Commonwealth.
This clause does not apply to:
. an amount paid to an insurer by another insurer under a right of
contribution, as specified in the Apportionment Certificate;
. a payment of Level 1 Commonwealth contribution;
. a payment of Level 2 Commonwealth contribution; and
. an amount of a kind specified in the regulations for the purposes of
this paragraph.
Clause 38 Obligation to notify the Medicare Australia CEO that amount has
been paid
Clause 38 provides that the insurer has an obligation to notify the
Medicare Australia CEO in writing that another amount has been paid which
has resulted in an overpayment described in subclause 37(2). Notification
must be given within 28 days after the applicant becomes aware of the
overpayment. Failure to notify is an offence.
Clause 39 The Medicare Australia CEO to notify of amount of debt due
Clause 39 provides for the Medicare Australia CEO to notify the insurer of
the amount of an overpayment that is a debt due, and the due date for the
payment of the debt.
Clause 40 Penalty imposed if an amount is repaid late
Clause 40 provides for a late payment penalty if the amount owing under
subclause 37(3) is paid back late. The payment is calculated at the rate
specified in the Rules on unpaid amounts for the period commencing when the
amount become due and payable and ending when the amount and the penalty on
that amount has been paid in full.
The Medicare Australia CEO may remit the whole or a part of an amount of
late payment penalty if the Medicare Australia CEO considers that there are
good reasons for doing so. Such a decision is reviewable by the
Administrative Appeals Tribunal.
Division 4-Effect of setting a run-off cover termination date
Clause 41 Commonwealth's obligations if a run-off cover termination date
is set
Clause 41 provides that, subject to the Rules setting out alternative
arrangements, if a termination date is set for the run-off cover scheme the
Commonwealth becomes liable to pay an amount in accordance with this
Division in relation to affected eligible midwives.
Clause 42 Affected eligible midwife
Clause 42 provides that an eligible midwife is an affected eligible midwife
if:
. a run-off cover termination date has been set;
. before the termination date, premiums have been paid for midwife
professional indemnity cover for the eligible midwife for 12 months;
. the eligible midwife was not a person to whom subclause 31(2) applies.
Clause 43 Payments in relation to affected eligible midwife
This clause sets out when and to whom the Commonwealth is liable to make a
payment in relation to affected eligible midwives. These amounts:
. must be paid to a person who is nominated by the eligible midwife and
has provided midwife professional indemnity cover for the eligible
midwife under a contract of insurance;
. must be paid as all or part of the premium payable for the provision of
that cover; and
. must be paid within 12 months after that date; and
. must not exceed the eligible midwife's total run-off cover credit (see
clause 44).
These amounts are payable out of the Consolidated Revenue Fund, which is
appropriated accordingly.
Clause 44 Total run-off cover credits
Clause 44 sets out how to work out an affected eligible midwife's total run-
off cover credit. Broadly, this will be equal to a percentage of the
premiums paid under a contract of insurance to an eligible insurer for
midwife professional indemnity cover and interest on those amounts.
Subclause (1) sets out a three step process for the calculation of the
total run-off cover credit:
. Step 1: For the first financial year after 30 June 2010, multiply the
eligible midwife's run-off cover credit for the financial year by the
interest rate adjustment;
. Step 2: For each subsequent financial year (if any) until the financial
year in which the termination date occurs, multiply:
- the sum of the eligible midwife's run off cover credit for the financial
year and the amount worked out under step or this step, for the
immediately preceding financial year; by
- the interest rate adjustment for the financial year;
. Step 3: The total run-off cover credit is the total of:
- the eligible midwife's run-off cover credit for the financial year in
which the run-off cover termination date occurs; and
- the last of the amounts worked out under step 1 or step 2.
Subclause (2) provides that the eligible midwife's run-off cover credit for
a financial year is the sum of all run-off cover support payments that are
attributable to the eligible midwife in relation to the financial year.
Subclause (3) provides that payments are attributable to the eligible
midwife in the financial year if they relate to the premiums paid during
the financial year to an eligible insurer for midwife professional
indemnity cover provided for the eligible midwife by one or more contracts
of insurance with the eligible insurer.
Subclause (4) sets out the interest rate adjustment for a financial year.
Broadly, this factor is 1 plus the applicable interest rate (that is, the
amount set out in the Rules or, if no rate is specified, the short term
bond rate for the June quarter immediately preceding the financial year).
The June quarter is defined to mean a period of 3 months commencing on 1
April. The short term bond rate is also defined.
Clause 45 Eligible insurers must provide information attributing run-off
cover support payments
Clause 45 requires an eligible insurer, in relation to a run-off cover
support payment that the eligible insurer is liable to make, to give
written notification to the Medicare Australia CEO of:
. each eligible midwife to whom the payment is attributable;
. for each such eligible midwife, each financial year in relation to which
the payment is attributable; and
. for each such eligible midwife and financial year, the extent to which
the payment is attributable to the midwife in relation to the financial
year.
The notification must be given in writing before the payment day for the
run-off cover support payment.
Division 5-Miscellaneous
Clause 46 Medicare Australia CEO must be notified of a person ceasing to
be covered by the midwife run-off cover provisions
This clause requires the eligible insurer to notify the Medicare CEO, in
writing, if a person ceases to be a person who is eligible for midwife
professional indemnity run-off cover.
The notification must set out the details of the cessation and must be
given within 61 days, or such greater number of days specified in the
Rules.
Clause 47 Invoices for midwife professional indemnity cover
This clause provides that if an eligible insurer gives an invoice for
midwife professional indemnity cover for which the insurer is liable to pay
run-off cover support payment, the insurer must ensure the invoice states
the total premium payable and the proportion and amount of the premium that
represents a run-off cover support payment.
Clause 48 Reports on run-off cover Commonwealth provision
This clause requires the Minister to:
. cause a report to be prepared of the operation of this Part within 6
months after the end of the financial year; and
. cause a copy of the report to be tabled in each House of the Parliament
within 15 sitting days of that House after its receipt by the Minister.
This report includes:
. the number of persons who were eligible for run-off cover indemnity at
the end of the financial year;
. the amounts paid for run-off cover indemnity by the Commonwealth during
the financial year;
. the total of all the amounts of run-off cover support payments remitted
to the Commonwealth during the financial year; and
. estimates by the Actuary of the Commonwealth's future liabilities.
This clause does not apply in relation to a financial year starting after
any termination of the run-off cover scheme.
Clause 49 Modifications and exclusions
This clause provides for the Rules to modify the application of the
Division in respect of claims, contracts of insurance, or specified classes
of liabilities. It also allows Rules to prescribe modifications regarding
liabilities under an order of a court requiring an amount to be paid
pending the outcome of an appeal.
It does not allow the Rules to modify a provision that creates an offence,
or that imposes an obligation which, if contravened, constitutes an
offence.
The power for these Rules to be made is required to allow the scheme to
reflect the any emerging changes to the market for professional indemnity
insurance.
The Rules will allow the scheme to respond to the industry's provision of
new types of insurance products to cover new types of claims, and to
respond to contracts and claims that are affected in an unintentional
manner by the legislation.
Part 4-Administration of provisions relating to Commonwealth contributions
Division 1-Guide
Clause 50 Guide to this Part
This guide outlines that this Part provides for the administration of the
Level 1 Commonwealth contributions, the Level 2 Commonwealth contributions
and the run-off cover Commonwealth contributions.
Subclause (2) provides a table outlining where to find the provisions
dealing with various issues.
Division 2-Apportionment certificates
Clause 51 When may the Medicare Australia CEO issue an apportionment
certificate in relation to a claim?
This clause sets out the circumstances when the Medicare Australia CEO may
issue an apportionment certificate in relation to a claim against a
midwife.
Subclause (1) provides that the Medicare Australia CEO may issue an
apportionment certificate if:
. either a qualifying claim certificate has been issued or the claim is an
eligible run-off claim; and
. the Medicare CEO is satisfied that there is a person (other than the
midwife or the eligible insurer) against whom a claim has been made, or
is reasonably likely to be made, in relation to the incident to which
the claim relates; and
. an application for the certificate has been made in accordance with
clause 53.
Subclause (2) requires the certificate to specify the proportion of
overall liability that should be attributed to the midwife and the other
person or persons against whom a claim is being made for an incident.
Subclause (3) provides that, in relation to the other person or persons,
the proportion of the overall liability may be specified for each of
those persons individually or those persons taken as a group. For
example, the certificate could specify that a claim be paid out in the
following proportions: 40% to the midwife, 60% to the hospital and
medical practitioner, or 40% to the midwife, 40% to the medical
practitioner and the remaining 20% to the hospital.
Subclauses (4), (5) and (6) provide that the proportion of the overall
liability set out in the certificate may be the same or different to the
proposed apportionment set out in the application. The key
consideration is whether the Medicare CEO is satisfied that the
apportionment is reasonable. In determining whether the apportionment
is reasonable, the Medicare CEO may have regard to the information in
the application and any other information that the Medicare CEO
considers appropriate.
Subclause (7) operates to enable the Medicare CEO to make his or her
decision having regard only to the information included in the
application.
Subclause (8) provides that an apportionment certificate is not a
legislative instrument. This provision has been included to assist the
reader, as the instrument would not be a legislative instrument within
the meaning of section 5 of the Legislative Instruments Act 2003.
Clause 52 Medicare CEO must not issue an apportionment certificate in
certain situations relating to court judgments or orders
Subclause (1) provides that an apportionment certificate must not be issued
if:
. a judgment or order of a court has been made in relation to the claim;
and
. the judgment or order specifies the liability of the eligible midwife in
relation to the claim
. the judgment or order is not stayed and is not subject to appeal; and
. the defence of the claim against the midwife was conducted
appropriately.
Subclause (2) sets out the circumstances where a claim is conducted
appropriately.
Subclause (3) defines defence of the claim to include any settlement
negotiations on behalf of the midwife.
Clause 53 Applications for apportionment certificates
This clause provides that a claim made by the eligible insurer in relation
to a claim must be in writing using a form approved by the Medicare
Australia CEO and be accompanied by the documents and other information
required by the form approved by the Medicare Australia CEO.
Clause 54 Time by which an application must be decided
This clause provides that the Medicare Australia CEO must make a decision
on an application for the issue of an apportionment certificate on or
before the 21st day after the day on which the application is received by
the Medicare Australia CEO. However, if the CEO requests a person to give
information under clause 62, the CEO does not have to decide the
application until 21 days after the day on which the person gives the
information to the Medicare Australia CEO.
Clause 55 Obligation to notify the Medicare Australia CEO if information
is incorrect or incomplete
This clause applies if an apportionment certificate is in force in relation
to a claim, and a person becomes aware that the information provided to the
Medicare Australia CEO in connection with the application for the
certificate was incorrect or incomplete, or is no longer correct or
complete. This clause imposes an obligation on a person, who applied for
an apportionment certificate or applied for a payment of Commonwealth
contribution, to notify the Medicare Australia CEO of any information
provided which was incorrect or incomplete, or is no longer correct or
complete. The notification must be made in writing and within 28 days
after the person became aware.
Clause 56 Revocation and variation of apportionment claim certificates
This clause gives the Medicare Australia CEO the power to revoke or vary an
apportionment certificate.
Revocation
Subclause (1) provides that the Medicare Australia CEO has the power to
revoke an apportionment certificate if the Medicare Australia CEO is no
longer satisfied for the purposes of subclauses 51(2) or (3).
Variation
Subclause (2) provides that the Medicare Australia CEO has the power to
vary an apportionment certificate so that it correctly identifies or
specifies the matter.
Effect of Revocation
Subclause (3) provides that an amount of Commonwealth contribution already
paid in relation to a claim before the Medicare Australia CEO revokes an
apportionment certificate will be an amount overpaid to which clause 64
applies.
Effect of Variation
Subclause (4) provides that if, as a result of a variation of an
apportionment certificate, an amount that has already been paid exceeds the
amount that would have been paid if the amount of Commonwealth contribution
had been determined having regard to the certificate as varied, the amount
of the excess is an amount overpaid to which clause 64 applies.
Medicare Australia CEO to give applicant copy of varied certificate
Subclause (5) provides that the Medicare Australia CEO must give a copy of
the varied certificate within 28 days of making his or her decision.
Clause 57 AAT review of decision to issue, revoke or vary
This clause provides for review of the following decisions by the
Administrative Appeals Tribunal:
. not to issue an apportionment certificate;
. specify a particular apportionment in an apportionment certificate; or
. revoke or vary an apportionment certificate.
Division 3-Applications for, and payment of, Commonwealth contribution
Clause 58 Application for Level 1 Commonwealth contribution or a
Commonwealth run-off cover contribution
Clause 58 provides that an application by an eligible insurer for a Level 1
Commonwealth contribution or a run-off cover Commonwealth contribution must
be made in writing using a form approved by the Medicare Australia CEO and
be accompanied by documents and information required by the approved form.
Clause 59 Payment date for Level 1 Commonwealth contribution or a run-off
cover Commonwealth contribution
This clause requires the Medicare Australia CEO to make a payment that is
payable to an insurer before the end of the month that follows the month in
which the insurer applied for the contribution or, if the Medicare
Australia CEO requested information from a person under clause 62, the end
of the month that follows the month in which the information in the request
is provided to the Medicare Australia CEO.
This clause also provides that the Medicare Australia CEO does not have to
decide the application for payment of a Level 1 Commonwealth contribution
until the Medicare Australia CEO has decided the application for the issue
of a qualifying claim certificate when both are received but not yet
decided.
Clause 60 Application for Level 2 Commonwealth contribution
Subclause (1) provides that an application for a Level 2 Commonwealth
contribution in relation to a qualifying liability that relates to a claim
may be made by the person against whom the claim is or was made, or by a
person acting on that person's behalf.
Subclause (2) provides that the application must be made in writing using a
form approved by the Medicare Australia CEO and be accompanied by the
documents and other information required by the form approved by the
Medicare Australia CEO.
Subclause (3) provides that subject to subclauses (4) and (5), the
application cannot be made more than 28 days after:
. if the liability is under a judgment or order of a court-the date on
which the judgment or order became or becomes a judgment or order that
is not stayed and is not subject to appeal; or
. if the liability is under a settlement of the claim-the date on which
the settlement agreement was entered into; or
. if the liability is some other kind of liability-the date on which the
liability was incurred.
Subclause (4) provides that the Medicare Australia CEO may accept a late
application if the Medicare Australia CEO considers that there are good
reasons for doing so.
Subclause (5) provides that an application may be made to the
Administrative Appeals Tribunal for review of a decision of the Medicare
Australia CEO not to accept a late application.
The note explains that section 27A of the Administrative Appeals Tribunal
Act 1975 requires notification of a decision that is reviewable.
Clause 61 Payment date for Level 2 Commonwealth contribution
Subclause (1) provides that, subject to subclauses (2) and (3), the
Medicare Australia CEO is to decide an application for Level 2 Commonwealth
contribution on or before the end of the 21st day after the day on which
the application is received.
Subclause (2) provides that if the Medicare Australia CEO requests a person
to give information under clause 62 in relation to an application for a
Level 2 Commonwealth contribution, the Medicare Australia CEO does not have
to decide the application until the 21st day after the day on which the
person gives the information to the Medicare Australia CEO.
Subclause (3) provides that if the Medicare Australia CEO has received, but
not yet decided on an application for a qualifying claim certificate and an
application for a Level 2 Commonwealth contribution, the Medicare Australia
CEO does not have to decide the application for payment of a Level 2
Commonwealth contribution until he or she has decided the application for
the issue of a qualifying claim certificate.
Time by which payment must be made
Subclause (4) provides that if the Medicare Australia CEO decides to grant
an application for a Level 2 Commonwealth contribution, the Medicare
Australia CEO must pay the contribution to the applicant as soon as
practicable after making that decision.
Division 4-Information gathering and record keeping
Clause 62 Medicare Australia CEO may request information
This clause provides that if the Medicare Australia CEO believes on
reasonable grounds that a person is capable of giving information relevant
to determining:
. whether a Commonwealth Contribution is payable;
. the amount of the Commonwealth contribution that is payable;
. whether a qualifying claim certificate or an apportionment certificate
should be issued, varied or revoked; or
. the Commonwealth's possible future liability to make Commonwealth
contributions, or a particular kind of Commonwealth contributions;
he or she may request the person to provide the information (including
records or copies of records maintained under clause 63).
Subclause (2) provides for the persons from whom the Medicare Australia
CEO can request information.
Subclause (3) provides for the Medicare Australia CEO to request a copy
of a record, if the record is required to be kept under clause 63.
Subclause (4) allows the Medicare Australia CEO to request information
periodically.
The request must be in writing, state what information is required,
specify a day at least 28 days after the notice is given to comply, and
state that a failure to comply with the request is an offence.
Clause 63 Main record keeping obligations
This clause requires a person who applies for a Commonwealth contribution
to maintain relevant records, including on matters determined by the
Medicare Australia CEO. A person who applies for a qualifying claim
certificate to maintain records relevant to satisfying the criteria in
subclause 11(1) or (2) and any other matter determined by the Medicare
Australia CEO.
The records must be maintained for five years after whichever is the later
of the day on which the records were made or the day this legislation
commenced.
A determination made by the Medicare Australia CEO must be published in the
Gazette at least 14 days before the determination is to take effect.
The clause does not operate to have required a person to do anything before
the commencement of this Bill.
Division 5-Overpayments of the contributions
Clause 64 Recovery of overpayments
This clause defines an amount overpaid as either an amount paid by way of a
Commonwealth contribution to a person when a Commonwealth contribution was
not payable, or an amount paid that was greater than the Commonwealth
contribution that was payable, and provides that the amount overpaid is a
debt due to the Commonwealth.
Subclause (4) provides that the amount overpaid may be recovered by action
against the insurer in a court of competent jurisdiction, by deduction from
the amount of a Level 1 Commonwealth contribution, a Level 2 Commonwealth
contribution or a run-off cover Commonwealth contribution payable to the
insurer, or under clause 65. It also provides that the amount recovered
must not exceed the amount overpaid.
Clause 65 Medicare Australia CEO may collect money from a person who owes
money to a person
This clause provides for the recovery of a debt to the Commonwealth under
clause 22(6), 25(3), 37(3), or 64(3) through garnishee action.
Subclause (2) provides for the Medicare Australia CEO to direct a third
party who owes or may owe money to a liable person, to pay some or all of
the money to the Medicare Australia CEO. The Medicare Australia CEO must
also provide a copy of the direction to the liable person.
Subclause (3) provides that the direction cannot require an amount to be
paid to the Medicare Australia CEO at a time before it becomes owing by the
third party to the liable person.
Subclause (4) provides that if:
. the repayment or overpayment debt relates to a Level 2 Commonwealth
contribution; and
. the recipient and the midwife referred to in subclause 22(1) are not the
same person; and
. the midwife because the liable person; and
. the direction was given to the recipient;
the direction ceases to have effect when the midwife becomes the liable
person.
Subclauses (5) and (6) provide that it is an offence of strict liability
for the third party to fail to comply with the direction unless they comply
with the direction so far as they are able to do so.
Subclause (7) provides that a court may order a person convicted of an
offence under subclause (5) to pay the Commonwealth an amount up to the
amount involved in the failure to comply as well as imposing a penalty.
Subclause (8) indemnifies the third party for any payment made under the
clause.
Subclauses (9) and (10) require the Medicare Australia CEO to give
immediate notice to the third party if the debt due to the Commonwealth is
fully or partly discharged before the third party has made a payment. If
the debt is partly discharged, the Medicare Australia CEO must vary the
direction under subclause (2).
Subclause (11) defines the circumstances in which a third party is taken to
owe money to an insurer.
Division 6-Offences
Clause 66 Failing to give information
This clause provides that a person who fails to comply with a request under
subclause 62(1) commits an offence of strict liability. A person is
excused from complying with the request if to do so would tend to
incriminate them or expose them to a penalty.
Clause 67 Failing to notify
This clause provides that a person who fails to notify the Medicare
Australia CEO under clauses 26 or 38 within a particular period commits an
offence of strict liability.
Clause 68 Failing to keep and retain records
This clause provides that a person who fails to keep and maintain records
as required by clause 63 commits an offence of strict liability.
Clause 69 Failing to include required information in invoices
This clause provides that a person commits an offence if the person is an
eligible insurer, and the person gives an invoice to another person and the
invoice does not state the matters required by clause 47.
Division 7-Finance
Clause 70 Appropriation
This clause provides that the Consolidated Revenue Fund is appropriated for
the purpose of paying Level 1 Commonwealth contributions, Level 2
Commonwealth contributions and run-off cover Commonwealth contributions.
Division 8-Reinsurance contracts
Clause 71 Commonwealth contributions disregarded for purposes of
reinsurance contracts
Subclause (1) provides that a contract of insurance between two insurers
governed by the laws of a State or Territory has effect as if the contract
provided that Commonwealth contributions and insurers' rights to
Commonwealth contributions were to be disregarded for the purposes of the
contract, and in particular in working out amounts payable under the
contract by the insurer providing the insurance.
Subclause (2) provides that subclause (1) applies to a contract entered
into on or after the commencement of this Bill.
Subclause (3) provides that subclause (1) applies to a contract entered
into before the commencement of this Bill.
Chapter 3-Run-off cover support payments
Part 1-Introduction
Clause 72 Guide to this Chapter
Subclause (1) outlines that this Chapter provides for the payment of run-
off cover support payments and the administration of run-off cover support
payments.
Subclause (2) provides that the proposed Midwives' Professional Indemnity
(Run-off cover Support Payment) Act 2009:
. imposes payments on eligible insurers for contribution years; and
. specifies the amount of those payments (by reference to an eligible
insurer's premium income for the contribution year)
Subclause (3) includes a table setting out where to locate provisions
within this Chapter.
Part 2-Payment of run-off cover support payment
Clause 73 Who is liable to pay the run-off cover support payment?
This clause provides that a person is liable to pay a run-off cover support
payment for a financial year that is a contribution year if they were an
eligible insurer and not exempt under clause 74.
Clause 74 Exemptions
This clause provides that a person is exempt from run-off cover support
payments in circumstances specified in the Rules. The Rules may provide
that a person is exempt from run-off cover support payment either generally
or for a particular contribution year.
Clause 75 When run-off cover support payment must be paid
The clause provides that a run-off cover support payment becomes due and
payable on 30 June in the contribution year, or such other day as is
specified in the Rules.
Clause 76 Late payment penalty
This clause provides that if an amount of contribution payable by a person
remains wholly or partly unpaid after it becomes due for payment, the
person is liable to pay a late payment penalty calculated at the prescribed
rate on the unpaid amount, from the date the contribution was due for
payment until the day the unpaid contribution and the late payment penalty
are paid in full.
Subclause (3) allows the Medicare Australia CEO to remit a late payment
penalty in whole or in part, and subclause (4) provides for a review by the
Administrative Appeals Tribunal of a decision by the Medicare Australia CEO
not to remit a late payment penalty or to remit only part of a late payment
penalty.
Clause 77 Method of paying certain amounts
This clause provides that a run-off cover support payment and a late
payment penalty payable under clause 76 must be paid to the Medicare
Australia CEO. The Rules may specify methods for paying these amounts.
Clause 78 Refund of overpaid amounts
This clause provide that if a person overpays an amount of run-off cover
support payment or a late payment penalty for a contribution year, the
overpaid amount must be refunded unless the amount has been previously
repaid to the person in accordance with an authorisation under section 33
of the Financial Management and Accountability Act 1997.
Subclause (2) provides that the Consolidated Revenue Fund is appropriated
for the purpose of providing a refund under this clause.
Clause 79 Recovery of payment debt
This clause provides that an amount of run-off cover support payment and a
late payment penalty under clause 76 are debts due to the Commonwealth and
may be recovered by the Medicare Australia CEO in a court of competent
jurisdiction.
Clause 80 Medicare Australia CEO may collect money from a person who owes
money to a person
This clause provides for the recovery of a debt to the Commonwealth under
clause 79 through garnishee action.
Subclause (2) provides for the Medicare Australia CEO to direct a third
party, who owes or may owe money to a liable person, to pay some or all of
the money to the Medicare Australia CEO. The Medicare Australia CEO must
also provide a copy of the direction to the liable person.
Subclause (3) provides that the direction cannot require an amount to be
paid to the Medicare Australia CEO at a time before it becomes owing by the
third party to the liable person, nor specify a period of less than 14 days
within which the third party must comply with the direction.
Subclauses (4), (5) and (6) provide that it is an offence of strict
liability for the third party to fail to comply with the direction unless
they comply with the direction so far as they are able to do so.
Subclause (7) provides that a court may order a person convicted of an
offence under subclause (4) to pay the Commonwealth an amount up to the
amount involved in the failure to comply as well as imposing a penalty.
Subclause (8) indemnifies the third party for any payment made under the
clause.
Subclauses (9) and (10) require the Medicare Australia CEO to give
immediate notice to the third party if the debt due to the Commonwealth is
fully or partly discharged before the third party has made a payment. If
the debt is partly discharged, the Medicare Australia CEO must vary the
direction under subclause (2).
Subclause (11) defines the circumstances in which a third party is taken to
owe money to the payment debtor.
Clause 81 Evidentiary certificates
This clause allows the Medicare Australia CEO to issue a written
certificate that a person is liable to pay a run-off cover support payment
or a late payment penalty in relation to a run-off cover support payment
setting out the particulars of that liability, and provides that the
certificate is prima facie evidence of the matters in the certificate in
any civil proceedings under this Bill.
Subclause (3) provides that a document purporting to be a certificate must
be taken to be a certificate and to have been properly issued unless the
contrary is established.
Subclauses (4) and (5) allow the Medicare Australia CEO to issue a
certified copy of a certificate and provide that it is to be treated as if
it were the original.
Part 3-Information gathering provisions
Clause 82 Medicare Australia CEO may request information
This clause provides that if the Medicare Australia CEO believes on
reasonable grounds that a person is capable of giving information relevant
to determining whether a person is liable to pay a run-off cover support
payment, and if so how much, or whether a person has midwife professional
indemnity cover, it may request the person to provide the information.
This clause is based on the equivalent provision in the Medical Indemnity
Act 2002, which provides similar schemes to subsidise the medical indemnity
insurance of medical professionals.
The request must be in writing, state what information is required, specify
a day at least 28 days after the notice is given to comply, and state that
a failure to comply with the request is an offence.
Clause 83 Medicare Australia CEO must be notified of a change in
circumstances etc.
This clause provides that a person who is exempt from the payment of a run-
off cover support payment because of particular circumstances must notify
the Medicare Australia CEO in writing within 28 days of the occurrence of a
change in circumstances affecting their exemption.
Clause 84 Failing to give information
This clause provides that a person who fails to comply with a request under
subclause 82(1) commits an offence of strict liability. A person is
excused from complying with the request if to do so would tend to
incriminate them or expose them to a penalty.
Clause 85 Failing to notify
This clause provides that a person who fails to notify the Medicare
Australia CEO within a particular period under clause 83 commits an offence
of strict liability.
Chapter 4-Miscellaneous
Clause 86 General administration of this Act and Midwife Professional
Indemnity (Run-off Cover Support Payment) Act 2009
This clause provides that the Medicare Australia CEO has the general
administration of this Bill and the proposed Midwife Professional Indemnity
(Run-off Cover Support Payment) Act 2009.
Clause 87 Additional functions of the Medicare Australia CEO
This clause provides that the Medicare Australia CEO has such functions,
additional to those under the Medicare Australia Act 1973, as are conferred
on it under this Bill and the proposed Midwife Professional Indemnity (Run-
off Cover Support Payment) Act 2009.
Clause 88 Officers to observe secrecy
Subclause (1) defines various terms used in the clause.
It defines protected information as information obtained by a person to
whom the clause applies (being a person who is or was an officer) in the
course of their duties or the exercise of their powers and functions under
the midwife professional indemnity legislation, and relates to a person's
affairs.
It defines a protected document as a document that contains protected
information.
Subclause (2) provides that a person to whom the clause applies commits an
offence if they copy, disclose or produce protected information or a
protected document to another person other than in the performance of their
duties or the exercise of their powers and functions, or to enable another
person to perform functions under certain Commonwealth legislation.
Subclause (3) provides that, despite subclause (2), the Secretary or the
Medicare Australia CEO may divulge protected information to a person if the
Minister certifies that it is necessary in the public interest, or may
divulge protected information to a person who the Minister believes is
expressly or impliedly authorised to obtain it by the person to whom the
information relates.
Subclause (4) provides that, despite subclause (2), the Secretary or the
Medicare Australia CEO may divulge protected information of a kind
prescribed in regulations to a person or authority prescribed in
regulations.
Subclause (5) provides that any person or authority, or person or employee
under the control of a person or authority, who receives information under
subclauses (3) and (4), is subject to subclause (2).
Subclause (6) provides that the clause does not prohibit divulging or
communicating to a person information that relates to them.
Clause 89 Act not to apply in relation to State insurance within a State
This clause provides that the Bill does not extend to State insurance
within a State.
Clause 90 Minister may make Rules
This clause gives the Minister the power to make Rules providing for
matters required or permitted to be made by this Bill or necessary or
convenient to be provided in order to carry out or give effect to the Bill.
The Rules may apply, adopt or incorporate with or without modification, any
matter contained in any other instrument or writing.
Clause 91 Regulations
This clause allows the Governor-General to make regulations prescribing
matters required or permitted to be prescribed under the Bill, or necessary
or convenient to be prescribed for carrying out or giving effect to the
Bill, including prescribing penalties not exceeding 10 penalty units (i.e.
$1,100) for offences against the regulations.
MIDWIFE PROFESSIONAL INDEMNITY (RUN-OFF COVER SUPPORT PAYMENT) BILL 2009
notes on clauses
Clause 1 Short title
This clause sets out the short title for the Bill, once enacted.
Clause 2 Commencement
This clause sets out that the Bill, once enacted, commences on 1 July 2010.
Clause 3 Definitions
This clause defines terms used in the Bill, or indicates where else in the
Bill terms are defined.
Clause 4 Imposition of run-off cover support payment
This clause imposes the run-off cover support payment as a tax on each
eligible insurer for each contribution year.
Clause 5 Contribution year
This clause provides for each financial year, or other period of 12 months
specified in the Rules, that starts on or after 1 July 2010 to be a
contribution year.
The Rules may specify different periods for a particular insurer or class
of insurer.
Clause 6 Amount of run-off cover support payment
This clause provides for the amount of the run-off cover support payment
imposed on an eligible insurer for a contribution year as a percentage of
the insurer's premium income for the period of 12 months ending on 31 May
in each contribution year, or such other period as specified in Rules.
The percentage is 15% or such lower percentage as is specified in the Rules
(which may specify different percentages for a particular eligible
insurer). The Government intends to amend the percentage to 10% by Rules.
This is consistent with the initial rate of contribution for the Run-off
Cover Scheme for medical practitioners. The Government will contribute $5
million to the Run-off Cover Scheme pool, and the remainder will be
contributed by this tax.
Clause 7 Premium income
This clause provides that premium income for a period is the sum of all
premiums paid during the period to the eligible insurer for midwife
professional indemnity cover provided for eligible midwives by contracts of
insurance with the insurer, and includes the sum of all amounts paid to the
insurer during the period that are amounts of a kind specified in the
Rules.
Subclause (2) provides that the amount of an eligible insurer's premium
income for a period excludes certain amounts. It excludes relevant amounts
of GST, stamp duty and amounts specified in Rules where they relate to the
make up of the premium.
Amounts worked out using the formula in subclause (3) are also excluded.
Clause 8 Rules
This clause confers power on the Minister to make Rules providing for
matter required or permitted by the Bill to be provided in the Rules, or
necessary or convenient to be provided in order to carry out or give effect
to the Bill.
Clause 9 Regulations
This clause allows the Governor-General to make regulations prescribing
matters required or permitted by the Bill, or necessary or convenient to be
provided in order to carry out or give effect to the Bill.