Dr Kerryn Phelps, AMA President, NSW Parliament House, Sydney

And Craig Knowles has been talking to the other state health ministers and Bob Carr is talking to the other premiers about putting in place some changes along the lines of the public liability changes as well.

The whole thing, sort of, has blown up all at the same time.

QUESTION: Obviously a welcome move then?

PHELPS: Indeed.

Doctors and patients in Australia are the winners out of the announcement by the Government to provide a capital guarantee to UMP for $35 million. This will ensure the short term viability of UMP.

We were really facing the situation where medical services in Australia were under serious threat. We now have some time to put in place some state and federal law changes so that the medical indemnity situation, which has blown out of all proportion, can regain some commonsense so that we can have some long-term solutions.

QUESTION: Does the Government now need to step in to look towards these long-term solutions or who needs to work towards that?

PHELPS: The entire community needs to work together to find long-term solutions, that is the medical profession, the legal profession, patients, communities and, particularly, state and federal governments because we'll be looking to the State and Federal Governments for the changes to the laws that are required to put some commonsense back into medical indemnity.

We are at serious risk of losing essential medical services, particularly in obstetrics and neurosurgery, unless we get substantial changes. And this will spread not only across all of the specialities but it will spread right around the countryside. Rural and regional Australia and metropolitan Australia would be affected unless we had these changes.

QUESTION: Specifically, what sort of long term changes do we need?

PHELPS: The longterm changes we need include the Federal Government acting to change the taxation situation for structured settlements so that we don't have these enormous lump sums that are very difficult to predict.

The second thing they need to do is to put in place a coordinated national scheme to take care of the rehabilitation and care costs for people who are severely injured by medical accidents.

State Governments need to have a uniform approach to state government tort law reform, similar to those introduced in New South Wales by Craig Knowles just last year and, that will mean that the way that the courts handle medical negligence cases will be more efficient, less expensive and more socially just.

QUESTION: How optimistic are you that all of those changes will be given the green light?

PHELPS: Unless we get these changes the situation will be disastrous. We have to have a coordinated federal and state approach. The medical profession has been working very hard with governments at both levels to ensure that everybody understands how grave the situation is and we've been working towards solutions. We know the problem is there. The medical profession has been working on solutions.

Now, this will involve, of course, new risk management processes as well, new ways of perhaps reporting, new ways of mediating with patients when there's been an adverse outcome and new ways of dealing with situations that arise where there is an adverse outcome for patients.

QUESTION: Do you have any comments on the PBS?

PHELPS: If the reports are true, that the Government is planning a $2 billion budget cut to the PBS over the next four years, this could have disastrous implications for the people who are the most sick and disadvantaged in our community and those are the people with chronic illness and particularly with multiple pathologies. If they have, for example, diabetes and heart disease it could be very expensive and if the PBS wasn't there to provide a safety net for those people then they either wouldn't be able to afford the medication or they wouldn't be able to get access to them.

The second thing we don't need is more bureaucratic red tape and if you add on more layers of authority that doctors have to apply for in order to get patients PBS subsidies, then that's more bureaucratic work that doctors have to do and it's less time that we're able to spend with the patients.

So we would urge the Government to work with the medical profession to find solutions that are practical and it's not all about doctors prescribing, it's about a whole vast range of other issues. Doctor prescribing is probably the last thing you would target.

We need to look at, for example, direct consumer advertising so that you don't get this enormous demand for drugs like Zyban and Celebrex until the medical profession has a chance to assess these new treatments and to work out where they best fit in the treatment of cases for the benefit of patients' medical care.

Ends