Doctors deals on trial

The recent despair among doctors over new indemnity arrangements after July 1 is not entirely based on uncertainty about detail.

The fear is also coupled with resentment.

This is towards the Federal Government over what it has done, plus the WA Government over what it has not organised early enough.

It started with the near-collapse of the Sydney-based United Medical Protection medical defence organisation two years ago, WA AMA president Pearn-Rowe said.

This put in jeopardy the livelihood of 26,000 doctors, who needed the cover, not only for potential claims, but to be able to practise in New South Wales.

The "fix" could have been confined to NSW, Dr Pearn-Rowe said, as other medical defence organisations, particularly those in South Australia and WA, were run professionally and soundly.

Prior to July 1 this year, the medical defence organisations - run by mutual organisations of doctors – collected subscriptions and reinsured internationally to cover members’ claims.

But July 1 will be the start of "a whole new era of professional indemnity," Dr Pearn-Rowe said.

All medical indemnity will come under the full jurisdiction of the Australian Prudential Regulatory Authority from July 1, under a new framework imposed by the Federal Government on medical practice throughout Australia.

Indemnity contracts will be required to be "cut and dried" and prescriptive about what they do and do not offer, whereas previously the MDO could use its discretion over whether or not to support a particular claim.

Certainty will be afforded, but flexibility lost, and many held some resentment that the UMP crisis and the Federal Government response had forced such change on the nation, Dr Pearn-Rowe said.

The Federal Government recently agreed to help support the MDOs in their cover of private work by practitioners who were covered by their employer’s insurance, but not for services they provided in public hospitals.

All Australian State Governments, with the exception of WA, have been covering this type of public hospital work.

The WA Government has now agreed to provide full medical indemnity cover to non-salaried medical practitioners treating public patients in public hospitals from   July 1.

This will include full retirement cover and cover for incidents incurred but not reported.

Kalgoorlie doctor and General Practice Divisions of WA chair Charley Nadin described the gesture by the WA Government as extraordinarily important and timely.

But despite the WA Government providing an information package to doctors, and draft insurance contracts to those in rural and regional areas, some medical practitioners say they are uncertain of their position.

These include doctors working as sole employees of their own incorporated companies, and those who care for public patients at the Joondalup and Peel hospitals.

Joondalup and Peel are privatised hospitals, but 95 per cent of the patients are public patients, the AMA says.

The Federal Government’s indemnity reimbursement proposal for rural GPs who perform obstetrics and surgery does not include rural surgical specialists.

"The rural surgical specialists are a small but vitally important group," Dr Nadin said.

The medical defence organisations are not the favourite of rural doctors, either.

While the WA Government will cover for the first time private doctors who provide services for public patients in public hospitals for 12 months, the MDOs are nonetheless increasing premiums.

"Most country doctors provide services for public patients in public hospitals, so these MDO increases are extraordinary," Dr Nadin said.

"They will be charging more for covering less."

The WA Government plans to legislate to restrict the time over which medical negligence and damages claims can be lodged, but Dr Nadin said this, too, remained an issue.

"There will be a proviso regarding ‘exceptional circumstances’, and this will especially affect obstetricians," he said.

"It leaves them feeling extraordinarily exposed."

WA-founded indemnity fund MDA National (formerly MDAWA) would increase general subscriptions by five per cent from July 1, but stamp duty, introduced in the recent State budget, would make the rise equivalent to 11 per cent, MDA National president David Watson said.

The WA Government will review its public hospital cover after 12 months, after it has had time to assess its impact, plus that of Federal Government changes.

Should MDOs change the scope of their cover, following the yet to be passed Medical Indemnity (Prudential Supervision and Product Standards) Bill 2002, the WA Government would need to change its scheme, a spokesperson for the Health Minister said.

The State Government is also planning to change tort law reform under the Limitations Act 1935, to modify evidence requirements for medical negligence findings.

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