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Medical Indemnity Legislation Amendment Bill 2006
WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments. This Digest does not have
any official legal status. Other sources should be consulted to determine
the subsequent official status of the Bill.
CONTENTS
Passage History
Purpose
Background
Main Provisions
Concluding Comments
Endnotes
Contact Officer & Copyright Details
Medical Indemnity Legislation Amendment Bill 2006
Date introduced:
House: House of Representatives
Portfolio: Health and Ageing
Commencement: Schedule 1 items 1, 20 and
21 are taken to have commenced on
This Bill makes some amendments to the Run Off Cover Scheme (ROCS). ROCS is one of a suite of measures that was implemented by the Federal Government at the height of the medical indemnity crisis to improve the affordability of medical indemnity insurance. The Bill also makes some minor amendments to other aspects of the medical indemnity regime.
This Bill changes the eligibility criteria for health care professionals to the ROCS scheme. Item 1 deletes paragraph 34ZB(1)(c). This removes the requirement currently in the Act for a health care professional to have had medical indemnity cover at the time of the incident to be covered by ROCS. Items 20 and 21 also make the same amendment to the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003. This amendment was necessary as insurers and medical practitioners have often not kept complete records of their insurance history and hence could not produce evidence to substantiate the requirement that they held medical indemnity cover at the time of the incident.
Persons entitled to ROCS are set out in 34ZB(2). They include:
Item 3 makes it clear that the time for determining whether a person falls within one of these categories is the time the claim is first notified to the MDO or medical indemnity insurer.
The Bill makes a series of amendments to clarify that the entitlements to reimbursements under the Medical Indemnity Act 2002 is linked to the ROCS regime which is set up under the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003. The amendments are contained in items 2, 4, 5, 6, 7 and 8.
The Bill amends the Medicare notification period that MDOs and medical indemnity insurers have when a health care professional ceases to be covered by ROCS, increasing the period from 28 days to 61 days (item 9).
The period that insurers have to notify Medicare that a practitioner is covered by the ROCS regime is also increased from 28 days to 61 days (items 22 and 23).
Item 18 changes the offence provisions for written acceptance of retroactive cover so that where an offer for insurance does not include retroactive cover, the contract cannot be entered into until the practitioner has given a response in writing regarding retroactive cover. The explanatory memorandum to the bill notes that
The effect of this will be that where doctors refuse the retroactive component, they must do so in writing, but where the doctor accepts the retroactive component, there is no requirement for consent to be in writing. (in practice this will often be indicated by payments of the invoice).
This will ensure that doctors who take out medical indemnity insurance without a retroactive component do not do so inadvertently.(6)
The Bill contains a series of other minor technical amendments and some minor consequential changes needed as a result of the commencement of the Legislative Instruments Act 2003.
This Bill contains some technical amendments to the medical indemnity regime. In particular, the Bill makes some changes to the operation of the run off cover scheme. The changes are uncontroversial.
This paper has been prepared to support the work of the Australian Parliament using information available at the time of production. The views expressed do not reflect an official position of the Parliamentary Library, nor do they constitute professional legal opinion.
ISSN 1328-8091
© Commonwealth of Australia 2006
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Published by the Parliamentary Library, 2006.