Dr Trevor Mudge, AMA Vice President, with Steve Liebmann, Radio 2UE, 'Drive'
LIEBMANN: The country's biggest medical indemnity insurer has put up its premium by an average of 52 per cent and consequently we're being warned today that doctors, in fact, are issuing the warning of rises in patients fees of up to $400. Now, when I read that story by the Sydney Morning Herald's health writer Mark Robertson, I thought, 'that cannot possibly be right', but I'm assured it probably is. On the line is Dr Trevor Mudge, the Federal Vice President of the Australian Medical Association. Dr Mudge, good afternoon to you.
MUDGE: Good afternoon, Steve.
LIEBMANN: Is that figure right?
MUDGE: Yes, it is. It's hard to estimate with any certainty, but it's going to be of that sort of order for a confinement.
LIEBMANN: That's an extraordinary jump in fees though.
MUDGE: Well, it's an extraordinary jump in insurance premiums. We're going from $60,000 to about $103,000 for an obstetrician. Now, $103,000, given that the average number of deliveries per obstetrician in this country is about 90, if you divide that out, it's going to be in the order of $400 per confinement.
LIEBMANN: And as a result of this we're warned that some GPs and some specialists, especially those in country areas could literally leave the profession.
MUDGE: Yes, I think this will happen. It's been happening and this new hike is going to make all of us, as obstetricians, think very seriously about the economics of continuing in practice. It's happened elsewhere in the world that the State of Florida in the US found all its obstetricians giving up practice in the mid 1980s, and it wasn't until there were no obstetricians in the state that there was some reform to the tort system there. And, of course, there needs to be tort law reform here because obstetrics first, neuro-surgery second, and I guess orthopaedic surgery third will be priced out of the market, really, if this continues.
LIEBMANN: The Federal Government's saying it's a state matter, the states are saying they need help from the Commonwealth.
MUDGE: Gee, isn't that a familiar thing?
LIEBMANN: Yes, it is. But I mean, it doesn't get us anywhere, does it?
MUDGE: No, it doesn't and, of course, the answer is that governments need to take a leadership role and your state government has taken a leadership role in the sense that they recognise this problem and your Health Minister, Craig Knowles introduced reforms to tort law in New South Wales.
LIEBMANN: He put a ceiling on it.
MUDGE: Several months ago, yes. But in spite of that we've had a jump of 50 per cent or more and I guess that's what we've been saying, that yes, it's very good for New South Wales to have recognised the problem, but unfortunately it needs fundamental change of the system, not some tinkering around the edges, although give the Minister his due, that it did take some political will to achieve what has been achieved, but this indicates it isn't enough.
LIEBMANN: But when you talk about fundamental change, are you talking about change that has to come from Canberra, or is it a state-by-state change that you're looking for?
MUDGE: Well, we think it really needs to come from Canberra. We'd like to see a bipartisan approach to what's a problem for society in general, but both bipartisan in a political sense and also in a standard gauge rail sense between the Feds and the States, although that doesn't tend to happen very much in Australia, does it?
LIEBMANN: No. To your knowledge, in terms of doctors numbers, how many have we lost or are we likely to lose?
MUDGE: It's been progressive. It's hard to know what the figures are, but we have evidence within the College of Obstetricians and Gynaecologists that we've lost probably 15 per cent of practising obstetricians in the last three years.
LIEBMANN: And what do they do?
MUDGE: They practice gynaecology, only.
LIEBMANN: Okay.
MUDGE: They give up the delivering of babies. It's delivering babies where the real indemnity cost is because of the incidents of cerebral palsy and the very high future care costs, the Caloundre Simpson case, for example, in your state recently, $15 million, and bear in mind that was 20 years after the delivery. Now, I could deliver a baby today and be sued by that child's family in 27 years time. Now, 20 years ago the people insuring Caloundre Simpson didn't think that they'd be facing a $15 million settlement in 20 years. Now in 27 years, my settlement might be, I don't know, 15 billion. I mean, how do you know, given the escalation in costs. The whole problem with the industry is the uncertainty of future liability and that's why today, St Paul's, the biggest insurance group in the world in medical indemnity, have announced that they've pulled out of medical indemnity around the world. They clearly consider that insuring doctors is not a viable proposition and it's because of the uncertainty.
LIEBMANN: It's an ominous sign, isn't it?
MUDGE: It is an ominous sign, very ominous.
LIEBMANN: Okay, thanks for talking to us.
Ends