Medical indemnity reform wins
Strong advocacy efforts over two years has paid off, with the AMA securing bipartisan political support for medical indemnity stability.
The Medical and Midwife Indemnity Legislation Amendment Bill 2019 will ensure the AMA’s hard-won medical indemnity reforms of 2002 will continue to provide confidence for doctors, their patients, and insurers.
The bill was introduced to Parliament by Health Minister Greg Hunt and found the support of both sides of Parliament.
The ability of doctors to continue to practise medicine securely into the future has been strengthened.
The AMA played a critical role steering two indemnity reviews over the past two years.
AMA President Dr Tony Bartone said bringing the reviews to their conclusions was both challenging and rewarding.
“The AMA has fought hard to maintain the stability of our medical indemnity system and preserve the underwriting from the Commonwealth, which we achieved well over a decade ago,” Dr Bartone said.
“In 2016, there was a sudden and substantial cut to medical indemnity schemes, followed by the announcement of the two reviews.
“Concerned about the Government’s ongoing commitment to these schemes, the AMA advocated forcefully at each and every consultation, meeting, roundtable, and re-draft of the schemes.
“On behalf of the entire profession, we have worked with indemnity insurers, other peak groups, the Department of Health, the Minister’s office, and the Australian Financial Complaints Authority, to name but a few.”
Dr Bartone said the AMA had spent considerable time and significant resources on the review process.
He said that was because the AMA knows how critical a stable medical indemnity sector is to every doctors’ ability to practise medicine and focus on what really matters – their patients.
“There will be no further cuts to the Commonwealth’s funding of these schemes, including but not limited to the High Cost Claims Scheme and the Premium Support Schemes,” he said.
“This should ensure that the premium stability we have enjoyed continues.”
There will now be a separate scheme for allied health practitioners, meaning they are no longer part of the Medical Indemnity Schemes.
Dr Bartone said that was an important and welcome development for the medical profession.
“It returns us to a fundamental principle for these schemes that was there in the first place – they were designed for medical professionals,” he said.
“Improvements have also been made to the schemes, as well as additional monitoring and appeal processes for both indemnity insurers and practitioners.
“The AMA commends the Government for delivering on its promise to use the reviews to demonstrate an understanding of the link between Commonwealth support, affordable indemnity insurance, and cost-efficient stable health care provision.
“We also recognise the contribution of the medical indemnity industry in their collaborative work with the AMA in shaping these reforms.
“In an era of Medicare freezes, funding shortfalls, declining public hospital performance, and shrinking private health insurance membership, it is reassuring that the profession’s collaborative hard work has been successful in ensuring stability in this vital area.”
In the Minister’s Second Reading Speech, Mr Hunt said the improvements would take effect from July next year, allowing insurers ample time to implement necessary changes.
He said the legislation creates a level playing field for medical indemnity insurers.
“The Australian Government decided to subsidise the medical indemnity market to prevent market failure and stabilise the industry after Australia's largest medical indemnity provider, United Medical Protection, was placed in provisional liquidation in May 2002,” Mr Hunt said.
“At the time, there was uncertainty as to whether practitioners could access indemnity insurance, coinciding with an increase in claims, costs and premiums. “The Government continues to fund seven professional indemnity schemes to enable privately practising doctors, health practitioners and midwives to access affordable professional indemnity insurance.
“The Government remains committed to guaranteeing that these schemes continue to operate… This bill continues and extends that support but places it on a sustainable and competitive basis going forwards.”
Published: 22 Oct 2019