Fenn and Health Insurance Commission [2001] AATA 315 (19 April 2001)

Last Updated: 4 June 2001

DECISION AND REASONS FOR DECISION [2001] AATA 315

ADMINISTRATIVE APPEALS TRIBUNAL )

) No N2001/183

GENERAL ADMINISTRATIVE DIVISION )

Re ANDREW GUY FENN

Applicant

And HEALTH INSURANCE COMMISSION

Respondent

DECISION

Tribunal M J Sassella, Senior Member

Date 19 April 2001

Place Sydney

Decision The Tribunal does not have jurisdiction to review the decision in this matter.

[Sgd] M J Sassella

Senior Member

CATCHWORDS

Extension of time - Tribunal jurisdiction

Administrative Appeals Tribunal Act 1975, s 25(1) and (3)

Health and Other Services Act (Compensation) Act 1995, ss 17, 18, 21, 24 and 33G:

REASONS FOR DECISION

19 April 2001 M J Sassella, Senior Member

History of Application

1. On 15 May 1998 the Applicant sustained injuries in respect of which he took common law action for damages (Exhibit A1).

2. On 18 February 2000 Sidis J entered a verdict in favour of the Applicant in the common law damages action (Exhibit A3). The Applicant was to receive damages of $85,575-11 plus costs. The damages were in fact assessed at $114,100-15 gross, however the Applicant was adjudged 25% contributorily negligent and so the gross figure was reduced by $28,525-04. On the same date the defendant's insurance company, CGU Insurance, paid $7,500-00 to the Health Insurance Commission ("HIC") (Exhibit A8, remittance advice).

3. On 2 March 2000 the Applicant's solicitor, Mr D J Curran, wrote to the Applicant (Exhibit A3). He explained how the damages figure was constructed and alerted the Applicant that some money from the damages award would have to be paid to the HIC for refunding to Medicare in respect of medical accounts paid by Medicare for treatment associated with injuries covered by the damages award. The amount was estimated as approximately $2,101-15. Some money was also to be deducted for refunding to Centrelink in respect of social security paid to the Applicant between the date of the accident and the date of the damages verdict.

4. The solicitor wrote, "If HIC Medicare has not issued a current Notice of Charge then 10% of the Judgment monies will have to be sent to them and they will deduct what they are owed and will then refund you the balance."

5. On 27 March 2000 the Applicant's solicitor wrote again to the Applicant (Exhibit A4) to advise him, amongst other things, that the insurance company responsible for paying Mr Fenn's damages had made a payment of $7,500 (said to be 10% of settlement monies) to the HIC. He wrote, "Once a Notice of Charge has been issued by the HIC they will take their charge and then forward the balance of the 10% direct to you."

6. On 3 March 2000 the HIC wrote to the insurance company, CGU Insurance, providing a notice of past benefits (Exhibit A1). The amount identified as owing to the HIC was $2,126-70. The notice was valid until 3 June 2000.

7. On 28 April 2000 the HIC wrote to the Applicant enclosing a refund of $5,904-97 (Exhibit A5). That letter explained how the refund was calculated. $7,500 had been provided by CGU Insurance. Mr Fenn owed $2,126-70 for Medicare benefits. That would mean a refund of $5,473-30. However, the $2,126-70 repayable was reduced by 25%, the measure of Mr Fenn's contributory negligence. That was $431-67.

8. On 13 February 2001 the Applicant lodged an application for review with the Tribunal (Exhibit A6). He identified the decision under review as having been made on 3 March 2000 by HIC/Medicare. His reasons for the application were: "I advise that CGU Insurance are liable under section 24 of the act in accordance with section 21 of the Act 1995." In a letter accompanying his application for review the Applicant wrote :

"...On the 16^th of March 2000 a settlement was made. I settled for the sum of $75,000.00. I also agreed to pay HIC/Medicare 10% of settlement monies.

"CGU insurance made this payment of $7,5000 [sic] and HIC/Medicare deducted what they were owed and refunded me the difference of $5,904.97. The payment date was on the 2^nd of May 2000.

"As Notice of Charge was issued on the 3^rd of March 2000 and payment date was on the 5^th of May 2000. This Notice of Charge in accordance with section 21 of the Health and other services (compensation) ACT 1995. Under section 24 was valid until the 3^rd of June 2000.

"CONCLUSION: CGU Insurance are liable in accordance with section 21 Health and other services (compensation) ACT 1995 under section 24 of the ACT. For not paying the specified amount in Notice of Charge."

9. On 16 February 2001 the Tribunal's Deputy Registrar wrote to the Applicant (Exhibit A7) saying that she was "unable to find any legislation which would allow the Tribunal to review the decisions which you seek to have reviewed." The Applicant was given 14 days in which to advise in writing whether he considered the Tribunal had jurisdiction.

10. On 27 February 2001 the Applicant responded (Exhibit A8) and provided copies of other documents. As part of his response he wrote:

"On the 18^th of February 2000 HIC/Medicare received a payment of $7,500 from CGU Insurance. This payment is not the specified amount payable to the commonwealth as it is not 10% of judgment monies. As settlement was not made until the 16^th of March 2000 it is not my responsibility for this matter.

"CGU Insurance by making this payment became liable in accordance with section 21 of the Health and other services (compensation) ACT 1995 under section 24 of the ACT. In conjunction with judgment."

11. On 28 February 2001 the Tribunal's Deputy Registrar wrote to the Applicant (Exhibit A9) to seek a request for an extension of time as the application was lodged beyond the 60 days time limit.

12. On 6 March 2001 the Applicant lodged an application for extension of time for lodging an application for review of a decision (Exhibit A10). That application did not explain the delay in proceeding. In an attached letter he said his purpose in appealing was to show that the insurer had disregarded the law in not complying with it. The insurer disregarded the HIC notice of charge and the judge's authority.

13. On 21 March 2001 Ms C McMullen wrote, for the HIC (Exhibit A11), stating in essence that Mr Fenn's issues were with CGU Insurance, not the HIC, and suggesting that CGU had acted lawfully in their dealings with the HIC. In essence this was because, at the date of the judgment, there was no notice of charge issued. The insurer was justified in electing to send 10% of the settlement figure to the HIC within 28 days of the judgment.

Issues for the Tribunal

14. There are several issues before the Tribunal. These are:

1. Should the Tribunal grant the Applicant an extension of time?

2. Does the Tribunal have jurisdiction to consider the application for review, in any event?

Legal situation

15. The relevant legislation in this matter is the Administrative Appeals Tribunal Act 1975 ("the AAT Act), s 25(1) and (3), and the Health and Other Services (Compensation) Act 1995, ss 17, 18, 21, 24 and 33G:

The AAT Act

"25 Tribunal may review certain decisions

(1) An enactment may provide that applications may be made to the Tribunal:

(a) for review of decisions made in the exercise of powers conferred by that enactment; or

(b) for the review of decisions made in the exercise of powers conferred, or that may be conferred, by another enactment having effect under that enactment.

(3) Where an enactment makes provision in accordance with subsection (1), that enactment:

(a) shall specify the person or persons to whose decisions the provision applies;

(b) may be expressed to apply to all decisions of a person, or to a class of such decisions; and

(c) may specify conditions subject to which applications may be made."

Health and Other Services (Compensation) Act 1995

"Section 17

Notice to claimant

17. (1) The Managing Director may, in respect of the claim for compensation, give to the claimant a written notice that requires the claimant to give to the Commission a written statement specifying:

(a) the professional services (if any), in respect of which medicare benefit has been paid, that have been rendered in the course of treatment of, or as a result of, the injury the claimant claims to have suffered; and

(b) whether nursing home care or residential care has been provided in the course of treatment of, or as a result of, the injury the claimant claims to have suffered.

(2) The notice must specify the professional services (if any), in respect of which medicare benefit has been paid, that have been rendered to the claimant since the claimant claims to have suffered the injury.

(3) The notice must:

(a) state the period within which the claimant is required to give the statement to the Commission; and

(b) contain a statement of the claimant's rights to seek an extension of that period and to apply for reconsideration of decisions about extensions of the period.

(4) The Managing Director may give more than one notice to the claimant in respect of the same claim for compensation.

(5) The claimant or the notifiable person may request the Commission to give the claimant a notice under this section.

(6) The Managing Director must comply with such a request:

(a) if the claim for compensation was made more than 5 years before the request-within 60 days after the request was made; or

(b) otherwise-within 28 days after the request was made.

Section 18 Statement by claimant of past benefits

18. (1) Subject to subsection (3), the claimant must give to the Commission the statement required by the notice within the period of28 days after being given the notice.

(2) The statement must be verified by statutory declaration.

(3) Subject to subsections (4) and (4A) and section 20, the Managing Director may, by notice in writing, grant the claimant one or more extensions of the period.

(4) The period cannot be extended if:

(a) the notice in question under subsection 17(1) was given in relation to a claim for compensation in respect of which a judgment or settlement had already been made; and

(b) the Managing Director had not given a notice under section 21, in respect of the claim for compensation, during the 3 months preceding the judgment or settlement; and

(c) an advance payment has not been made in respect of the compensation payable under the judgment or settlement.

(4A) If an advance payment has been made under section 33B, the period cannot be extended:

(a) if only one notice under section 17 has been given to the claimant in relation to the claim for compensation in question-beyond the period of 12 months after the claimant received that notice; or

(b) in any other case-beyond the period of 12 months after the claimant received the last notice given to the claimant in relation to the claim for compensation.

(5) If the claimant does not give to the Commission a statement as required by this section, all the professional services specified in the notice under subsection 17(2) are taken for the purposes of this Act and the Charges Act to have been rendered in the course of treatment of, or as a result of, the injury the claimant claims to have suffered."

"Section 21

Notice of past benefits

21. (1) If, in relation to each notice given to the claimant under section 17 in respect of the claim for compensation, either:

(a) the claimant has given to the Commission a statement under section 18; or

(b) the period for giving the statement has expired;

the Managing Director may give to the notifiable person a notice under this section.

(2) The notice must set out:

(a) the period covered by the notice; and

(b) the total amount of eligible benefits paid by the Commonwealth, during that period, in respect of services and care rendered or provided in the course of treatment of, or as a result of, the injury the claimant claims to have suffered.

(3) If the claimant had given to the Commission a statement under section 18 prior to the Managing Director giving the notice, the notice must not, in relation to the period covered by the statement, take account of any eligible benefits that were paid in respect of services or care not specified in the statement.

(4) Without limiting the matters that the notice may include, it may include information about amounts that may become payable to the Commonwealth under this Act or the Charges Act in respect of the amount of compensation in question.

(5) Without limiting the matters that the notice may include, it may include a statement to the effect that, if a judgment or settlement is made in respect of the claim within 3 months after the notice was given, the notice is taken to be a notice of charge under section 24, given by the Managing Director on the day on which the judgment or settlement is made.

(6) If a notice contains a statement of a kind referred to in subsection (5), it must also contain a statement to the effect that, subject to subsection (7), if:

(a) the notice is taken to be a notice of charge under section 24; and

(b) the judgment or settlement fixes the amount of compensation on the basis that liability for the injury should be apportioned between the compensable person and the compensation payer; and

(c) as a result, the amount of compensation is less that it would have been if liability had not been so apportioned;

the amount specified in the notice as payable to the Commonwealth is reduced by the proportion corresponding to the proportion of liability for the injury that is apportioned to the compensable person by the judgment or settlement.

(7) If a notice contains a statement of a kind referred to in subsection (5), it must also contain a statement to the effect that, if:

(a) the notice is taken to be a notice of charge under section 24; and

(b) the amount of compensation is fixed by a judgment that specifies an amount (the "past expenses component"), being a portion of the amount of compensation, to be a component for either or both of the following:

(i) the medical expenses already incurred relating to the injury;

(ii) the expenses in respect of nursing home care or residential care already incurred relating to the injury;

the past expenses component is taken to be the amount specified in the notice as payable to the Commonwealth.

(8) Without limiting the matters that the notice may include, it may include a statement to the effect that if a reimbursement arrangement is made in respect of the claim, the notice is taken to be a notice of charge under section 25, given by the Managing Director on:

(a) if the reimbursement arrangement was made before the Managing Director gives the notice to the notifiable person-the day on which the Managing Director gives the notice to the notifiable person; or

(b) in any other case-the day on which the reimbursement arrangement is made.

(9) The Managing Director must give a copy of any such notice to the claimant.

(10) The Managing Director may give more than one notice to the notifiable person in respect of the same claim for compensation.

(11) Subject to subsection (13), the claimant or the notifiable person may request the Commission to give the notifiable person a notice.

(12) The Managing Director must comply with such a request:

(a) if, at the time the request was made, the claimant had been given a notice under section 17 with which he or she had not yet complied but the period for compliance had not expired-within 28 days after he or she complies or within 28 days after the period for compliance expires, whichever happens first; or

(b) if the Managing Director gives to the claimant a notice under section 17 within 28 days after the request was made-within 28 days after the claimant complies with the notice, or within 28 days after the period for compliance expires, whichever happens first; or

(c) in any other case-within 28 days after the request was made.

(13) Subsection (11) does not apply if:

(a) the Managing Director had given the notifiable person a notice within the period of 3 months prior to the request; or

(b) a judgment has been made in respect of the claim for compensation."

"Section 24

Notice of charge-claims resulting in judgments or settlements

24. (1) Subject to subsection (1A), if the Commission receives a notice under subsection 23(1), the Managing Director must give to:

(a) if the notifiable person in relation to the claim for compensation from which the judgment or settlement resulted is an insurer-that insurer; or

(b) otherwise-the compensation payer;

written notice specifying the sum of the amounts (if any) that are payable to the Commonwealth under this Act or the Charges Act in respect of the amount of compensation.

(1A) A notice under subsection (1) is not required if the compensation payer or insurer makes an advance payment in respect of the compensation.

(2) The notice must also specify, in relation to each kind of eligible benefit that the Commonwealth has paid in respect of any service or care rendered or provided in the course of treatment of, or as a result of, the claimant's injury, the sum of the amounts (if any) that will be payable to the Commonwealth under this Act or the Charges Act.

(3) The notice must not, in relation to any period covered by a notice under section 21 in respect of the claim, take account of any eligible benefits that were paid in respect of services or care not specified in the notice under section 21.

(4) The Managing Director must give the notice to the notifiable person:

(a) if the Managing Director had not given a notice under section 21, in respect of the claim for compensation, during the 3 months preceding the judgment or settlement-within 3 months after the Commission receives the notice under subsection 23(1); or

(b) otherwise-within 28 days after the Commission receives the notice under subsection 23(1).

(5) The Managing Director must give a copy of the notice to the compensable person.

(6) A notice under section 21 is taken also to be a notice under this section given by the Managing Director to the insurer or compensation payer (as the case requires) on the day on which the judgment or settlement is made if:

(a) the notice under section 21 includes statements of the kinds referred to in subsections 21(5), (6) and (7); and

(b) the judgment or settlement is made within 3 months after the notice was given.

(7) Subject to subsections (8) and (9), if subsection (6) applies to a notice, the amount specified in the notice pursuant to paragraph 21(2)(b) is taken to be the amount set out for the purpose of subsection (2) of this section.

(8) Despite subsection (7), if:

(a) subsection (6) applies to a notice; and

(b) the judgment or settlement fixes the amount of compensation on the basis that liability for the injury should be apportioned between the compensable person and the compensation payer; and

(c) as a result, the amount of compensation is less that it would have been if liability had not been so apportioned; and

(d) subsection (9) does not apply;

the amount specified in the notice pursuant to paragraph 21(2)(b), reduced by the proportion corresponding to the proportion of liability for the injury that is apportioned to the compensable person by the judgment or settlement, is taken to be the amount set out for the purpose of subsection (2).

(9) Despite subsection (7), if:

(a) subsection (6) applies to a notice; and

(b) the amount of compensation is fixed by a judgment that specifies an amount (the "past expenses component"), being a portion of the amount of compensation, to be a component for either or both of the following:

(i) the medical expenses already incurred relating to the injury;

(ii) the expenses in respect of nursing home care or residential care already incurred relating to the injury;

the past expenses component is taken to be the amount set out for the purpose of subsection (2)."

"Section 33G

Review of decision under section 33E by the Administrative Appeals Tribunal

33G. (1) Application may be made to the Administrative Appeals Tribunal for review of a decision by the Managing Director that a statement under section 18, or an amended statement under section 33E, is not substantially correct.

Note: Section 27A of the Administrative Appeals Tribunal Act 1975 requires the decision-maker to notify persons whose interests are affected by the decision of the making of the decision and their right to have the decision reviewed. In so notifying, the decision-maker must have regard to the Code of Practice determined under section 27B of that Act.

(2) Despite subsection 43(6) of the Administrative Appeals Tribunal Act 1975, the Tribunal's decision has effect on and from the day on which it is made."

Appearances

16. A hearing to discuss whether the Tribunal has jurisdiction to review the decision in question and, if it has, to hear argument as to the application for an extension of time, was held. Mr Fenn represented himself. The Respondent was represented by the General Counsel of the HIC, Mr Gath.

Argument

17. The Applicant advanced two main arguments. First, CGU Insurance advanced only $7,500 to the HIC on 18 February 2000. It should have advanced approximately $8,500 to the HIC in order to satisfy s 24 of the Act. In the Applicant's view, CGU Insurance had breached the Act and should be held to account for that breach. His second argument was that the HIC had retained from the $7,500 about $25 more as a result of the calculation of Mr Fenn's liability than it should have.

18. Mr Gath, for the Respondent, submitted that the Tribunal lacks jurisdiction to entertain this application. The Tribunal's jurisdiction under the Act is limited and stems from s 33G of the Act. Section 33G permits the Tribunal to review decisions made under ss 18 and 33E of the Act, and no other provision.

19. Mr Gath suggested that Mr Fenn's solicitor probably told the insurer that the settlement amount was $75,000 because he was retaining $10,000 to cover any of Mr Fenn's costs not recoverable from the defendant. While it was probably correct to say that the insurer had not fully complied with the requirements of s 24 of the Act in advancing less than $8,500, the HIC would not be interested in pursuing the insurer because it had been able to recover the money owing to it from the $7,500.

20. As regards the disputed $25, Mr Gath invited Mr Fenn to take this matter up with the HIC and set out why he thinks an excess $25 has been recovered from his funds.

Findings on material questions of fact with reference to evidence in support of those findings

21. The Tribunal refers to s 25 of the AAT Act. This section describes how the Tribunal comes to have jurisdiction to review a particular type of decision. An Act of Parliament, such as the Act, may provide, as s 33G does in the Act, that applications may be made to the Tribunal for review of decisions made in the exercise of powers conferred by the Act of Parliament. Section 25(3)(b) of the AAT Act provides that the provision in the empowering Act may be expressed to apply to all decisions of a person, or to a class of such decisions. The Act, in s 33G, provides for Tribunal review in respect of only a class of decisions.

22. To understand the operation of s 33G of the Act it is necessary to consider ss 17, 18 and 33E of the Act. Section 17 permits the Managing Director, in respect of a claim for compensation, to give to the claimant a written notice requiring the claimant to give the HIC a written statement specifying the professional services (if any) in respect of which Medicare benefit has been paid that have been rendered in the course of treatment of, or as a result of, the injury the claimant claims to have suffered. Similar provision is made for nursing home care and residential care.

23. Section 18 of the Act prescribes how the statement is to be presented. Section 33E regulates what occurs where an advance payment has been made and the Managing Director considers that the statement made under s 18 of the Act is not substantially correct. The Managing Director must give the compensable person a notice requiring the provision of an amended statement which is substantially correct.

24. Section 33G gives the Tribunal jurisdiction where the Managing Director has decided that a statement under s 18 of the Act, or an amended statement under s 33E of the Act, is not substantially correct. The compensable person may query the Managing Director's decision.

25. The exhibits before the Tribunal indicate that it is the operation of s 24, and possibly s 21, of the Act that the Applicant wishes to query in the Tribunal. His concerns do not relate at all to s 18 or s33E of the Act.

26. The Tribunal therefore finds that it lacks jurisdiction to entertain the Applicant's application for review. There is no purpose in considering whether to grant an extension of time.

27. In discussion with the Applicant at the hearing the Tribunal and Mr Gath suggested that Mr Fenn might consider approaching the HIC about the alleged $25 owing to him. On the other issues, and the $25 issue if the HIC does not resolve it, Mr Fenn may wish to contact the Commonwealth Ombudsman whose NSW contact details are:

Level 8, Landmark Building

345 George Street

Sydney 2000

[phone]

[phone] (fax)

1300 362 072 (country based complainants)

Mr Fenn may also wish to see his solicitor if he desires to progress his grievance against CGU Insurance.

Decision

28. The Tribunal does not have jurisdiction to review the decision in this matter.

I certify that the 28 preceding paragraphs are a true copy of the reasons for the decision herein of Mr M J Sassella, Senior Member.

Signed: .....................................................................................

Associate

Date of Hearing 17 April 2001

Date of Decision 19 April 2001

Representative for the Applicant Self-represented

Representative for the Respondent Mr S Gath