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Tuesday, 25 November 2003
Page: 22774


Mr JOHNSON (7:02 PM) —I am pleased to speak on the Medical Indemnity Amendment Bill 2003 and the Medical Indemnity (IBNR Indemnity) Contribution Amendment Bill 2003, which are before the parliament today. I am pleased to speak on the bills for a number of reasons, but above all because the amendments contained in these bills will have a positive impact on the Australian health system and will inject confidence into Australia's medical indemnity insurance system. I take much pleasure in reporting to the people of Ryan, as their local member, that the Howard government is working hard to address the challenges of medical indemnity that we have in this country and especially to come up with workable solutions.

The federal government, under the stewardship of the recently appointed Minister for Health and Ageing, Tony Abbott, is making great strides in addressing the big questions surrounding medical indemnity—so much so that the minister has most appropriately received generous endorsement from the President of the Federal AMA, Dr Bill Glasson, and many of his colleagues. I want to take this opportunity at the outset to make the parliament aware of one of Dr Glasson's remarks in relation to the new minister for health. This is what Dr Glasson had to say, following negotiations with the health minister:

The AMA finds it refreshing that the Government has displayed an energetic and sincere willingness to examine and repair the whole medical indemnity system so it can no longer haunt the medical profession and patients.

That is a very real acknowledgment from someone who is at the coalface in understanding this issue. He is paying tribute to the government when it should indeed be paid tribute.

Medical indemnity is a critical issue for all Australians because it affects the quality and delivery of medical services. We all want a comprehensive and robust health system that can respond to the needs of the Australian community. The instability that has been experienced in the health system with regard to medical indemnity is symptomatic of the international insurance crisis. We are all aware that since September 2001 global commerce, for a start, has been turned upside down and inside out because of the uncertainty and rising costs of insuring business activities and risk. Regrettably, this has flowed on to public indemnity in our own backyards and has affected everyday Australians in many ways.

In relation to medical indemnity specifically, the Howard government has worked exceptionally hard to respond to the community's concerns and the effect of this crisis on our health system and the medical profession. As we all know, the industry suffered terribly after the collapse of HIH—not to mention the impact of substantial increases in the number of claims, massive costs payments against doctors and of course the abysmal failure of managers in insurance companies such as UMP to properly provide for future claims. Not surprisingly, the public has looked to the Howard government for leadership and workable solutions.

The government passed the Medical Indemnity Act in 2002 and, earlier this year, the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003. The effect of those two pieces of legislation was initially to stabilise the medical indemnity sector and, very importantly, to bring certainty to the medical profession and to those medical specialists in particular who work very hard and who are very dedicated to their patients. To further strengthen this legislation and to respond to community concerns, the government has introduced the Medical Indemnity Amendment Bill 2003 and the Medical Indemnity (IBNR Indemnity) Contribution Amendment Bill 2003. The legislation currently before the House puts into effect agreements reached with the AMA in October and introduces an 18-month moratorium on IBNR contributions. During that time, contributions will be capped at $1,000 per year. The amendments also allow for the withdrawal of all current IBNR levy notices and refund existing payments. New levy notices will be issued after the review process is completed. The amendments address doctors' concerns about the financial burden of the IBNR contribution and about the equity of how it was to be determined.

A new aspect of the legislation is the Exceptional Claims Scheme, which fully indemnifies doctors for the component of settlement or judgment amounts that exceed the doctor's level of insurance cover. The Commonwealth government will pay the component amount that exceeds the insurance cover level. With this amendment, doctors can be confident that they can continue to practise with a strong medical indemnity regime to support them.

Following negotiations with the AMA undertaken in October, the minister announced a number of important measures to address industry and public concerns, and I want to refer to some of those in this speech. This included the formation of a policy review committee to begin quickly and to work towards solutions in a specified time frame. The policy review committee is due to report to the Prime Minister early next month, on 10 December 2003, and is in fact chaired by the minister for health himself. In addition, reflecting the importance of this committee and the mandate that it has, the Assistant Treasurer, the Hon. Senator Helen Coonan, sits on the committee, and two doctors, an insurance lawyer and an actuarial expert complete the committee's makeup. So this is a very important committee. It reflects the very serious approach of the government to this issue and our very strong determination to get to grips with this important issue facing the profession and of course the country generally.

The government also gave the undertaking that all current IBNR notices would be withdrawn and existing payments refunded, with new levy notices issued after the policy review process is completed. A number of exemptions from IBNR fees were also announced and undertaken by the government. These included exemptions for all doctors employed by public hospitals or where their private medical income is returned to these hospitals, exemptions for all doctors over 65 regardless of practice income, and exemptions for all doctors who retire early due to disability or permanent injury.

The High Cost Claims Scheme was also extended to cover 50 per cent of claims between $500,000 and $20 million. This means that the government will actually take up 50 per cent of the burden of high-cost claims between $500,000 and $20 million. The $20 million threshold will apply from 1 July 2003. I just remind the House that this is taxpayers' money. I think the opposition especially sometimes need reminding that, when the federal government spends money, it is coming from the hard-earned taxes of people who live in my electorate of Ryan—in suburbs like The Gap, Toowong and Taringa—and of course other hardworking Australians up and down the length and breadth of this country. Accommodating for this amount of funds is entirely responsible and appropriate, given the critical importance of medical indemnity to the medical profession and, as I alluded to earlier, to the broad community. It is important to maintain the confidence of the Australian people in our health system, and this legislation certainly does that.

This new legislation will do much to strengthen the confidence of doctors themselves in the medical indemnity insurance system and the confidence of the public in the health system. It should be made clear that the minister's negotiations and dealings with the AMA have been acknowledged by those who sometimes are the hardest to please, by those who rarely mince their words. At the outset of my speech, I quoted Dr Bill Glasson, and I want to take the opportunity to again quote Dr Glasson, because I think it is very important for the community to be aware that, when someone of his stature and rank speaks very positively about the minister or the government and the efforts of the government to come to a workable solution, it is very genuinely meant. So let me quote what the federal president of the AMA said of Tony Abbott's commitment to making things happen. Dr Glasson said:

Tony Abbott has today shown a solid understanding of the problem and has displayed a strong commitment to finding a workable and sustainable solution for doctors, patients and the whole community.

I think the key word there is `sustainable'. This is all about finding something that will endure and make a difference. It is no good coming up with short-term solutions. This can make a very important difference. I think all members, including some from the opposition, would accept that the remarks of Dr Glasson reflect well on the minister's tireless efforts and his commitment to obtaining a workable solution. The fact that the shadow minister and the previous speaker alluded to the opposition's support for these bills also reflect that.

The government has responded seriously to the very real concerns of doctors about their ability to continue practising with a strong and viable medical indemnity insurance system standing behind them. No-one in this country—not one single Australian—would question the tremendous contribution and the immense dedication the medical profession collectively makes to our community, and this government not only pays tribute to the work that doctors perform but indeed salutes the work ethic of doctors and the entire health industry throughout the country. We all know that doctors work very long hours. We all know that they are very dedicated to their profession, to the ethics and values of the profession and what they represent but, most importantly, to the health and wellbeing of their patients.

As a member of the federal parliament, as a member who represents the constituents in the electorate of Ryan, I want to take this opportunity to express a very sincere thanks to doctors, nurses and indeed all those in the medical and allied health profession who make a difference to our lives. For my part, with a brother who is in the medical profession—he is a neurosurgeon—and with a sister who has just gained acceptance into medical school, I can certainly assure the House and the voters of Ryan that I for one am made aware of the challenges facing the medical profession in terms of not only medical indemnity issues but also the broader issues facing the medical profession.

I stated at the outset that I was pleased to speak on these bills because of the positive impact of the proposed amendments. This is precisely what will transpire when the parliament passes these bills with the full support of the opposition. I know the people in my electorate of Ryan are very interested to know what the Howard Liberal government is doing on the health front, so it is important for me, as their local federal member, to report back to them on the activities and initiatives of the Howard government. This is just one example of the Howard government taking the ball up, as it were, to make things happen and to find workable and sustainable solutions.

Part of the long-term solution to this issue clearly lies in a major overhaul of the law of negligence that currently sees, at times, ridiculous amounts of money paid out to patients where the circumstances do not justify those massive payments. I want to stress that point: where the circumstances do not justify the massive payments. I do not want that to be taken out of context. No-one would begrudge a patient's just and appropriate compensation when there has been absolute gross negligence on the part of a doctor or a specialist, but it is also important to get some balance. It is also important to recognise that the work of specialists, doctors and those in the medical profession is inherently risky. It is a risky craft, a risky skill, that they practise, and the specialists need the understanding and support of the community for the truly incredible work that they perform. So changes to tort law will minimise disproportionate sums awarded by the courts. These sums are paid for by the public through insurers, because when insurers have these claims put to them they just pass them on to the public. This becomes untenable at the end of the day.

It is important that all the state and territory governments make contributions on this issue. I acknowledge the very strong efforts of the state Labor governments throughout the country. This is a good example of how Labor governments and the federal coalition can work together in the interests of the people of Australia. On such a very important issue facing the country, with the lives of our fellow Australians perhaps at stake at times, it is important that we can show the Australian people that we can work together, and I certainly want to acknowledge the contribution and efforts of the state governments. No doubt much more can be done to make things happen quickly.

As for my home state of Queensland, I understand that the Queensland government are also playing their part, but it is important that the electorate is broadly made aware of exactly what they are doing because, whilst they are perhaps making some inroads into tort law reform, I certainly have constituents raising this issue with me. In fact, only several weeks ago I had a retired justice of the Queensland Supreme Court approach me at a function to express his interest in being involved in this because he felt that not enough was being done. Whilst he did acknowledge that things were happening in terms of the state government's part in this, the fact that he approached me wanting to play a part in the resolution of this very important issue signals to me that perhaps much more can be done much more quickly.

In conclusion, I want to compliment the new health minister, the Hon. Tony Abbott, on his outstanding leadership in the portfolio that he has assumed responsibility for. To be able to negotiate with a group such as the AMA is no small thing and to have done it successfully and to have earned the tributes of that association's federal president reflects very strongly and very generously on the skills of the health minister. So I want to compliment the minister on his outstanding leadership and his stewardship of the Health portfolio and commend the bill to the parliament. I again encourage the opposition to support the government on its other pieces of legislation that are coming before the parliament before we break for Christmas.