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Midwife Professional Indemnity (Commonwealth Contribution) Scheme Bill 2010

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2008-2009

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME BILL 2009

 

MIDWIFE PROFESSIONAL INDEMNITY (RUN-OFF COVER SUPPORT PAYMENT) BILL 2009

 

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

(Circulated by the authority of the Minister for Health and Ageing, the Hon. Nicola Roxon MP)



 



MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME BILL 2009

MIDWIFE PROFESSIONAL INDEMNITY (RUN-OFF COVER SUPPORT PAYMENT) BILL 2009

 

Introduction

 

The Midwife Professional Indemnity (Commonwealth Contribution) Scheme Bill 2009 and the Midwife Professional Indemnity (Run-off Cover Support Payment) Bill 2009give effect to the Government’s new professional indemnity scheme for certain midwives.  The package was announced during the 2010 Budget by the Government.

 

Professional indemnity insurance is currently not available for private midwife practitioners in Australia.  From the perspective of the insurance industry, the two most commonly stated reasons for this are: (1) there is a lack of accurate and up-to-date data (which is necessary for insurers to be able to assess their actuarial liability); and (2) the potential premium pool is very low and would currently not support a market-priced premium level that is affordable for midwives.

 

The Commonwealth intends to contract with an insurer (through a national tender process) to provide this type of insurance at an affordable price to certain midwives.  In doing so, it will also require the contracted insurer to develop and maintain a database that the wider insurance market will be able to use in developing longer-term products. 

 

The insurance is intended to be available so that eligible midwives can be appropriately covered from 1 July 2010, in line with proposed new requirements of the National Accreditation and Registration Scheme.

 

The Bills create schemes in which the Commonwealth provides assistance to insurers for the cost of the claims against eligible midwives.  The insurance product offered to eligible midwives will be required to comply with all relevant provisions of relevant insurance law.

 

MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME BILL 2009

 

OUTLINE

 

The Bills provide for phase-in of Government assistance at specific cost points for each eligible claim.  This will allow the Commonwealth to assume liability for a significant proportion of the claim, whilst still providing a financial incentive for the eligible insurer to manage the claim in a cost effective manner.

 

The Commonwealth Contribution Bill provides that the Government will pay certain amounts for claims against an eligible midwife.  In the case of practising eligible midwives, the Bill will provide as follows.

      For each claim, the insurer will pay the first $100,000;

      For each claim over $100,000 the Government will pay 80% of the cost that exceeds that threshold, up to a ceiling of $2 million (claims within this $100,000 to $2 million range are referred to as Level 1 Commonwealth contribution payments); and

      For each claim that exceeds $2 million, the Government will pay at the Level 1 rate for the first $2 million, plus 100% of the cost of the claim above that threshold (claims above the $2 million threshold are referred to as Level 2 Commonwealth contributions).

 

This Bill provides a capacity for the Government to change the $100,000 threshold, the $2 million threshold and rate of subsidy applying to both Level 1 and Level 2 claims by Rules.

 

Claims may not be finalised until many years later (for cases involving births, under various State and Territory tort law, claims may be made more than 21 years after the incident).  The contracted insurer will remain responsible for managing and finalising claims for all notified incidents during the period of its contract with the Commonwealth.

 

Examples of how the process will work are shown next.  For claims notified against an eligible midwife in the financial year beginning 1 July 2010:

      Claim 1 of $90,000 is within the $100,000 threshold, so the insurer pays the whole claim.

      Claim 2 of $500,000 exceeds the threshold by $400,000 (and is therefore a Level 1 Commonwealth contribution claim):

-            the insurer pays the first $100,000 and 20% of the remaining $400,000;

-            the Commonwealth pays 80% of $400,000;

      Claim 3 of $2,800,000 exceeds the $2 million threshold by $800,000 (and is therefore a Level 2 Commonwealth contribution claim):

-            the insurer pays the first $100,000 and 20% of $1,900,000

-            the Commonwealth pays 80% of $1,900,000 and all of the remaining $800,000 over the $2 million threshold.

 

For Level 1 and Level 2 Commonwealth contributions a claim will only be paid if the claim has been certified as a qualifying claim by the Medicare Australia CEO.

 

The scheme will also provide that, when a claim is made against an eligible midwife who has ceased practice for certain reasons (e.g. retirement or disability), the midwife's insurer will continue to provide 'run-off cover' for that midwife.  The Commonwealth will make a contribution to the insurer for amounts the insurer is liable to pay under that cover.  The Commonwealth's contribution will be partly funded through a levy on the relevant insurer's premium income for providing insurance cover to eligible midwives.

 

Broadly, the scheme provides for apportionment where a claim has been made in relation to the same incident which involves a person other than the midwife or the eligible insurer.  The Medicare Australia CEO will issue apportionment certificates which set out how a claim should be apportioned between the midwife and the other person or persons having regard to information provided by the applicant and other relevant information.

 

The Bill will not cover any incident that occurs before 1 July 2010.  Overseas practice will not be covered either.

 

The Midwife Professional Indemnity (Run-off Cover Support Payment) Bill 2009 imposes the run-off cover support payment as a levy on insurers by reference to their premium income.

 

MIDWIFE PROFESSIONAL INDEMNITY (RUN-OFF COVER SUPPORT PAYMENT) BILL 2009

 

OUTLINE

 

Under the run-off cover scheme eligible midwives claims will be paid out by the Australian Government and the cost of this scheme will be funded by a levy on eligible insurers.

 

This Bill imposes the run-off cover support payment as a levy on insurers by reference to their midwife professional indemnity premium income.

 

Financial impact statement

 

The measures that these Bills will enable (including through delegated legislation), have a total cost of $25.2million over four years.  The budgeted annual costs, which include administrative and Department of Health and Ageing costs, and administrative costs for Medicare Australia to introduce the necessary systems changes and manage the program, are set out in the table below:

 

2009-10

($ million)

2010-11

($ million)

2011-12

($ million)

2012-13

($ million)

Total

($ million)

$4.7         

$8.1       

$4.4      

$7.9

$25.2

 

 



MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME BILL 2009

NOTES ON CLAUSES

General note on the use of Rules

A number of provisions in the Bill provide for certain things to be specified in Rules made by the Minister.  This is so that aspects of the Midwife Professional Indemnity (Commonwealth Contribution) Scheme can be readily and speedily modified if required.  Any Rules will be legislative instruments, subject to the requirements of the Legislative Instruments Act 2003 , and in particular may be subject to disallowance.

 

Chapter 1 Introduction

 

Part 1 Preliminary

 

Division 1 Preliminary

 

Clause 1  Short title

This clause sets out the short title of the Bill, once enacted.

 

Clause 2  Commencement

This clause sets out that the Bill, once enacted, will commence on 1 July 2010.

 

Division 2 Objects and Guide

 

Clause 3  Objects of this Act and the Commonwealth contribution legislation

This clause sets out the Objects of this Bill, including providing Commonwealth assistance to support access by eligible midwives to professional indemnity arrangements.  This assistance is provided by meeting part of the costs of certain large claims, and meeting the costs of certain claims for midwives no longer in private practice.

 

Clause 4  Guide to this Act

This clause describes the chapters in the Bill.

 

Division 3 Definitions

 

Clause 5  Definitions

This clause defines terms used in the Bill, or indicates where else in the Bill terms are defined.

 

Division 4 Other general matters

 

Clause 6  External Territories

This clause provides that the Bill extends to the external Territories.



Clause 7  Rules may set termination dates

This clause provides that the Rules may set:

      a Level 1 termination date;

      a Level 2 termination date;

      a run-off cover termination date.

 

Chapter 2 Midwife Professional Indemnity Commonwealth Contributions

 

Part 1 Guide to this Chapter

 

Clause 8  Guide to this Chapter

This clause provides that Chapter 2 is about midwife professional indemnity Commonwealth contributions.  Part 2 deals with Level 1 and Level 2 Commonwealth contributions.  Part 3 deals with run-off cover Commonwealth contributions.  Part 4 deals with the administration of these schemes.

 

Part 2 Level 1 and Level 2 Commonwealth contributions

 

Division 1 Preliminary

 

Clause 9  Guide to the Level 1 and Level 2 Commonwealth contribution provisions

This clause sets out a guide to Level 1 and Level 2 Commonwealth contribution provisions.

 

Subclause (1) provides that a Level 1 Commonwealth contribution may be paid to an eligible insurer that pays more than a particular amount on a claim that arises from the practice by the person as an eligible midwife.  This claim must be certified as a qualifying claim before a payment can be made.

 

Subclause (2) provides that a Level 2 Commonwealth contribution may be paid in relation to a liability of a midwife if:

      the liability relates to a claim against the midwife in relation to an incident that occurs in the course of, or in connection with, the practice by the person as an eligible midwife, and the claim has been certified as a qualifying claim; and

      the liability exceeds the amount payable under an insurance contract that limits the insurer’s liability under the contract.  The limit of the insurer’s liability must equal or exceed the Level 2 claim threshold set in subclause 10(2).

 

Subclause (3) sets out where in the Division particular provisions may be found.

 

Clause 10  Level 1 and Level 2 claim thresholds

This clause sets the Level 1 and Level 2 threshold in the following terms:

      the Level 1 threshold is $100,000, or such other amount as is specified in the Rules;

      the Level 2 threshold is $2 million, or such other amount as is specified in the Rules.

The Note explains that claims cannot be aggregated, so each claim must individually reach each threshold before Commonwealth contribution commences.

 

A variation to the threshold in the Rules only applies to a contract of insurance entered into or renewed after the Rule takes effect.  This will be the date on which the Rules are registered on the Federal Register of Legislative Instruments or a later day specified in the Rules.

 

Division 2—Certification

 

Clause 11  When may the Medicare Australia CEO certify a claim as a qualifying claim?

A person will only be entitled to a payment of a Level 1 or Level 2 Commonwealth contribution where a qualifying claims certificate is in force in relation to the claim.  This clause sets out the criteria that must be met before the Medicare Australia CEO can issue a qualifying claim certificate.

 

Subclause (1) provides that the Medicare Australia CEO may issue a certificate that a claim is a Level 1 qualifying claim if the Medicare Australia CEO is satisfied that the criteria set out in subclause (3) has been satisfied, and a person has applied for a Level 1 qualifying claim certificate in relation to the claim in accordance with clause 12.

 

Subclause (2) provides that the Medicare Australia CEO may issue a certificate that a claim is a Level 2 qualifying claim if the Medicare Australia CEO is satisfied that the common requirements set out in subclause (3) have been satisfied, the claim meets the additional Level 2 requirements set out in subclause (4), and a person has applied for a Level 2 qualifying claim certificate in relation to the claim in accordance with clause 12.

 

Subclause (3) sets out the common requirements that a Level 1 or Level 2 claim must meet before a qualifying certificate can be issued.  These requirements are:

      the claim is or was made against a person (the midwife); and

      the claim relates to an incident that occurs or occurred in the course of, or in connection with, the midwife’s practice as an eligible midwife; and

      except if specified in the Rules, the incident occurs or occurred in Australia or an external Territory; and

      the incident did not occur in the course of, or in connection with, treating public patients of a hospital; and

      the claim does not relate to an incident for which the Commonwealth, a State or a Territory, or local governing body or, an authority established under a law of the Commonwealth, a State or a Territory, indemnifies eligible midwives from liability relating to compensation; and

      the claim does not relate to an incident which is indemnified, or would in the ordinary course of business be indemnified from liability by the midwife’s employer; and

      for a Level 1 qualifying claim certificate—the incident occurs or occurred on or after 1 July 2010, and on or before the Level 1 termination date (if any); and

      for a Level 2 qualifying claim certificate—the incident occurs or occurred on or after 1 July 2010, and on or before the Level 2 termination date (if any); and

      the claim is not in substance an aggregation of two or more separate claims; and

      the claim is not a claim of a class specified in the Rules; and

      the claim does not relate to an incident of a kind specified in Rules; and

      the claim does not relate to a type of midwifery practice specified in Rules.

 

An example of an incident that would, in the ordinary course of business, be indemnified by an employer would be an incident that occurs while a midwife is continuing a prior employment relationship which has changed only in the aspect of the employer no longer paying for the midwife’s professional indemnity insurance.  This exclusion ensures consistency in meeting the Commonwealth’s outcomes.

 

Subclause (4) sets out the following additional requirements for Level 2 qualifying claim certificates:

      there is a contract of insurance entered into by an eligible insurer in relation to which the following requirements are met:

-            the contract provides cover for the midwife in relation to the claim, or but for the limit on the eligible insurer’s liability it would cover the midwife in relation to the claim;

-            the limit on the eligible insurer’s liability under the contract equals or exceeds the Level 2 threshold for the claim against the midwife;

-            the eligible insurer is a general insurer within the meaning of the Insurance Act 1973 ;

-            the eligible insurer entered into the contract in the ordinary course of the insurer’s business; and

      the contract of insurance is not a contract of a class specified in the Rules.

 

When a certificate is in force

Subclause (5) provides that the certificate comes into force when it is issued and remains in force until it is revoked.  These actions are undertaken by the Medicare Australia CEO.

 

Matters to be identified or specified in certificate

Subclause (6) provides that the certificate must:

      identify the midwife, the claim, and if the certificate is a Level 2 qualifying certificate, the contract of insurance in relation to which paragraph (4)(a) is satisfied; and

      specify the relevant threshold; and

      the certificate may also contain other material.

 

AAT review of decision to refuse

Subclause (7) provides that an application may be made to the Administrative Appeals Tribunal for review of a decision of the Medicare Australia CEO to refuse to issue a qualifying claim certificate.  The note explains that section 27A of the

Administrative Appeals Tribunal Act 1975 requires notification of a decision that is reviewable.



Medicare Australia CEO to give applicant copy of certificate

Subclause (8) provides that if the Medicare Australia CEO decides to issue a qualifying claim certificate, the Medicare Australia CEO must, within 28 days of making his or her decision, unless it is not reasonably practicable to do so, give the applicant a copy of the certificate.  However, a failure to comply does not affect the validity of the decision.

 

Subclause (9) provides that a qualifying claim certificate is not a legislative instrument.  This provision has been included to assist the reader, as the instrument would not be a legislative instrument within the meaning of section 5 of the Legislative Instruments Act 2003 .

 

Clause 12  Application for a qualifying claim certificate

This clause sets out how an application for a qualifying claim certificate must be made.

 

Subclause (1) provides that an application for the issue of a Level 1 qualifying claim certificate may be made by an eligible insurer.

 

Subclause (2) provides that an application for the issue of a Level 2 qualifying claim certificate may be made by an eligible insurer, or the person against whom the claim is or was made, or by a person acting on that person’s behalf.  The person against whom the claim is made is the midwife.

 

Subclause (3) provides that the application must:

      be made in writing using a form approved by the Medicare Australia CEO; and

      specify whether it is an application for a Level 1 qualifying claim certificate or a Level 2 qualifying claim certificate; and

      specify each person, other than the midwife concerned, against whom a claim has been or is reasonably likely to be made, in relation to the incident to which the claim relates; and

      be accompanied by the documents and other information required by the form approved by the Medicare Australia CEO.

 

Clause 13  Time by which an application must be decided

This clause sets out when an application for a qualifying certificate must be decided by.

 

Subclause (1) provides that, subject to subclause (2), the Medicare Australia CEO is to decide an application for the issue of a qualifying claim certificate on or before the 21st day after the day on which the application is received by the Medicare Australia CEO.

 

Subclause (2) provides that, if the Medicare Australia CEO requests a person to give information under clause 62 in relation to the application, the Medicare Australia CEO does not have to decide the application until the 21st day after the day on which the person gives the information to the Medicare Australia CEO.



Clause 14  Obligation to notify the Medicare Australia CEO if information is incorrect or incomplete

This clause requires the Medicare Australia CEO to be notified of incorrect or incomplete information in relation to qualifying claim certificates that have been issued.

 

Subclause (1) provides that, if:

      a qualifying claim certificate is in force in relation to a claim; and

      a person becomes aware that the information provided to the Medicare Australia CEO in connection with the application for the certificate was incorrect or incomplete, or is no longer correct or complete; and

      the person is:

-            the person who applied for the certificate; or

-            another person who has applied for a payment of Level 1 or Level 2 Commonwealth contribution in relation to the claim;

the person must notify the Medicare Australia CEO of the respect in which the information was incorrect or incomplete, or is no longer correct or complete.

 

The note explains that failure to notify is an offence (see clause 67).

 

Subclause (2) provides that the notification must:

      be made in writing (paragraph (a)); and

      be given to the Medicare Australia CEO within 28 days after the person becomes aware as mentioned in subclause (1) (paragraph (b)).

 

Clause 15   Revocation and variation of qualifying claim certificates

This clause gives the Medicare Australia CEO the power to revoke or vary a qualifying claim certificate.

 

Revocation

Subclause (1) provides that the Medicare Australia CEO may revoke a qualifying claim certificate if the Medicare Australia CEO is no longer satisfied as mentioned in subclauses 11(1) or (2) in relation to the claim.

 

Subclause (2) provides that, to avoid doubt, in considering whether he or she is still satisfied as mentioned in subclauses 11(1) or (2) in relation to the claim, the Medicare Australia CEO may have regard to matters that have occurred since the decision to issue the qualifying claim certificate was made, including for example:

      the making of Rules; or

      changes to the terms and conditions of the contract of insurance identified in the certificate.

 

Variation

Subclause (3) provides that, if the Medicare Australia CEO is satisfied that a matter is not correctly identified or specified in a qualifying claim certificate, the Medicare Australia CEO may vary the certificate so that it correctly identifies or specifies the matter.



Effect of revocation

Subclause (4) provides that, if:

      the Medicare Australia CEO revokes a qualifying claim certificate; and

      an amount of Level 1 or Level 2 Commonwealth contribution has already been paid in relation to the claim and that amount exceeds the amount that would have been paid if the amount had been determined having regard to the certificate as varied;

the amount is an amount overpaid to which clause 64 applies (the recovery of overpayments).

 

Effect of variation

Subclause (5) provides that, if:

      the Medicare Australia CEO varies a qualifying claim certificate; and

      an amount of Level 1 or Level 2 Commonwealth contribution has already been paid in relation to the claim, and that amount exceeds the amount that would have been paid if the amount of indemnity had been determined having regard to the certificate as varied;

the amount of the excess is an amount overpaid to which clause 64 applies (the recovery of overpayments).

 

AAT review of decision to revoke or vary

Subclause (6) provides that an application may be made to the Administrative Appeals Tribunal for review of a decision of the Medicare Australia CEO to revoke or vary a qualifying claim certificate.

 

The note explains that section 27A of the Administrative Appeals Tribunal Act 1975 requires notification of a decision that is reviewable.

 

Medicare Australia CEO to give applicant copy of varied certificate

Subclause (7) provides that if the Medicare Australia CEO decides to vary a qualifying claim certificate, the Medicare Australia CEO must, within 28 days of making the decision, give the applicant a copy of the varied certificate.  However, a failure to comply does not affect the validity of the decision.

 

Division 3 Payability

 

Subdivision A Level 1 payability

 

Clause 16  When is a Level 1 Commonwealth contribution payable?

This clause sets out the circumstances when a Level 1 Commonwealth contribution will be payable.

 

Basic payability rule

Subclause (1) provides that a Level 1 Commonwealth contribution is payable to an eligible insurer if:

      a claim (the current claim) is or was, made against a person (the midwife); and

      a Level 1 qualifying claim certificate is in force in relation to the current claim; and

      an apportionment certificate has been issued, if applicable, or an apportionment certificate has not been issued because of the operation of clause 52 (which deals with the claims for which there is a final judgement or order of a court); and

      the insurer has a qualifying payment (as defined in subclause (3)); and

      the amount of the qualifying payment exceeds the Level 1 claim threshold at the time the eligible insurer was first notified of the claim or incident; and

      a person has applied for the Level 1 Commonwealth contribution; and

      any other requirements specified in the Rules are met; and

      the current claim is not a claim included in a class specified in Rules.

 

Subclause (2) provides that the Rules made for the purposes of this clause do not apply to an incident if the claim relating to that incident was made before the Rules take effect.

 

Qualifying payments

Subclause (3) provides that an eligible insurer has a qualifying payment if the insurer:

      pays an amount in relation to the claim or is liable to pay an amount under a written agreement or court order or judgment not stayed or subject to appeal; and

      pays, or is liable to pay, the amount under an insurance contract with the midwife; and

      pays, or becomes liable to pay, the amount in the ordinary course of the insurer’s business; and

      the amount paid or payable is consistent with the amount specified in an apportionment certificate, if applicable.

 

Clause 17  Amount of Level 1 Commonwealth contribution

This clause sets the amount of the Level 1 Commonwealth contribution as 80% (or such other percentage as is specified in the Rules) of the amount by which the eligible insurer’s qualifying payments exceed the Level 1 claim threshold (but does not exceed the Level 2 claim threshold).

 

Subdivision B Level 2 payability

 

Clause 18  When is a Level 2 Commonwealth contribution payable?

This clause sets out the circumstances when a Level 2 Commonwealth contribution is payable.

 

Basic Payability Rule

Subclause (1) provides that the Medicare CEO may determine that a Level 2 Commonwealth contribution is payable in relation to a liability of a person (the midwife) if:

      a claim for compensation or damages (the current claim) is, or was, made against the midwife by another person; and

      a Level 2 qualifying claim certificate is in force in relation to the current claim; and

      the liability is a qualifying liability of the midwife in relation to the current claim (see clause 19); and

      the Medicare CEO has issued an apportionment certificate in relation to the claim, if applicable, or an apportionment certificate has not been issued because of the operation of clause 52 (which deals with the claims for which there is a final judgement or order of a court); and

      because of the limit of the insurer’s liability in relation to the contract of insurance identified in the qualifying claim certificate, the contract does not cover, or does not fully cover, the liability; and

      the amount that, if the limit had been high enough to cover the whole of the liability, the insurer would (subject to the other terms and conditions of the contract) have been liable to pay under the contract of insurance in relation to the liability exceeds the actual amount (if any) that the insurer has paid or is liable to pay under the contract in relation to the liability; and

      the amount that the insurer has paid, or is liable to pay, under the contract (including in relation to the claim); and

      the amount (if any) the eligible insurer has paid, or is liable to pay, under the contract equals or exceeds the Level 2 threshold identified in the qualifying claim certificate; and

      a person has applied for the Level 2 Commonwealth contribution in accordance with clause 60; and

      the claim is not a claim included in a class specified in Rules.

 

The notes explain the interactions with other clauses and that payments and liabilities to pay must meet the ordinary course of business requirement set out in subclause (3).

 

Who the contribution is payable to

Subclause (2) provides that the contribution is to be paid to the person who applies for it.

 

The note points out that clause 60 provides details on who can apply.

 

Ordinary course of business test for insurance payments

Subclause (3) provides that an amount that an eligible insurer has paid, or is liable to pay, under the contract does not count for the purpose of subparagraph (1)(g)(i) or (ii), unless it is an amount that the insurer paid, or is liable to pay, in the ordinary course of the insurer’s business.

 

AAT review of decision to refuse, or to pay a particular amount of contribution

Subclause (4) provides that an application may be made to the Administrative Appeals Tribunal for review of a decision of the Medicare Australia CEO to refuse an application for Level 2 Commonwealth contribution, or to pay a particular amount of Level 2 Commonwealth contribution.

 

The note explains that section 27A of the Administrative Appeals Tribunal Act 1975 requires notification of a decision that is reviewable.



Clause 19   Qualifying liabilities

A Level 2 Commonwealth contribution will only be payable if the liability is a qualifying liability in relation to the claim (see paragraph 18(1)(c)).  This clause sets out the criteria of a qualifying liability.

 

Subclause (1) provides that a person (the midwife) has a qualifying liability in relation to a claim made against the person if:

      one of the following applies:

-            the liability is under a judgment or order of a court in relation to the claim, being a judgment or order that is not stayed and is not subject to appeal;

-            the liability is under a settlement of the claim that takes the form of a written agreement between the parties to the claim;

-            the liability is some other kind of liability of the midwife (for example, a liability to legal costs) that relates to the claim; and

      the defence of the claim against the midwife was conducted appropriately (see subclause (2)) up to the time when:

-            if the liability is under a judgment or order of a court—the date on which the judgment or order became a judgment or order that is not stayed and is not subject to appeal; or

-            if the liability is under a settlement of the claim—the date on which the settlement agreement was entered into; or

-            if the liability is some other kind of liability—the date on which the liability was incurred; and

      if the liability is under a settlement of the claim, or is under a consent order made by a court—a legal practitioner has given a statutory declaration certifying that the amount of the liability is reasonable; and

      the amount paid or payable is consistent with an apportionment certificate that is in force in relation to the claim, if applicable.

 

Subclause (2) provides that, for the purposes of paragraph (1)(b), the defence of the claim is conducted appropriately if, and only if:

      to the extent it is conducted on the midwife’s behalf by an insurer, or by a legal practitioner engaged by the insurer—the defence is conducted to a standard that is consistent with the insurer’s usual standard for the conduct of the defence of claims; and

      to the extent it is conducted by the midwife, or by a legal practitioner engaged by the midwife—the defence is conducted prudently.

 

Subclause (3) defines defence of the claim to include any settlement negotiations on behalf of the midwife.

 

Clause 20  Interaction with Level 1 Commonwealth contribution and run-off cover

The clause provides that for the purposes of determining the limit of the eligible insurer’s liability under the contract of insurance and paragraphs 18(1)(e) and (f), an amount paid or payable under a contract of insurance is not to be reduced on account of a Level 1 Commonwealth contribution, or a run-off cover Commonwealth contribution, paid or payable to the eligible insurer.



Clause 21   Amount of Level 2 Commonwealth contribution

This clause provides that the amount of Level 2 Commonwealth contribution that is payable in relation to a particular qualifying liability is the amount of the excess referred to in paragraph 18(1)(e).

 

The note explains that it is only liabilities that exceed the limit will be covered by a Level 2 Commonwealth contribution (even if the Level 2 claim threshold is less than that limit).

 

Clause 22   How Level 2 Commonwealth contribution is to be applied

Subclause (1) provides that this clause applies if a Level 2 Commonwealth contribution (the contribution) is paid to a person (the recipient) in relation to a liability of a person (the midwife).

 

The note explains that the recipient will either be the midwife himself or herself, or a person acting on behalf of the midwife.

 

Medicare Australia CEO to give recipient of payment a notice identifying the liability to be discharged

Subclause (2) provides that the Medicare Australia CEO must give the recipient a written notice (the payment notice) identifying the liability in relation to which the contribution is paid, and advising the recipient how this clause requires the contribution to be dealt with.

 

Recipient’s obligation if the amount of the contribution equals or is less than the liability

Subclause (3) provides that if the amount of the contribution equals or is less than the undischarged amount of the liability identified in the payment notice, the recipient must apply the whole of the contribution towards the discharge of the liability.

 

Recipient’s obligation if the amount of the contribution exceeds the liability

Subclause (4) provides that if the amount of the contribution is greater than the undischarged amount of the liability identified in the payment notice, the recipient must:

      apply so much of the contribution as equals the undischarged amount of the liability towards the discharge of the liability; and

      if the recipient is not the midwife—deal with the balance of the contribution in accordance with the directions of the midwife.

 

Time by which recipient must comply with obligation

Subclause (5) provides that the recipient must comply with whichever of subclauses (3) and (4) applies:

      by the time specified in a written direction (whether contained in the payment notice or otherwise) given to the recipient by the Medicare Australia CEO; or

      if no such direction is given to the recipient—as soon as practicable after the Commonwealth contribution is received by the recipient.

 

To avoid doubt, the Medicare Australia CEO may vary a notice under paragraph (a) to specify a different time.

 

Debt to Commonwealth if recipient does not comply with obligation on time

Subclause (6) provides that if the recipient does not comply with whichever of subclauses (3) and (4) which applies by the time required by subclause (5), the amount of the contribution is a debt due to the Commonwealth.

 

Subclause (7) provides that the debt may be recovered:

      by action by the Medicare Australia CEO against the recipient in a court of competent jurisdiction; or

      under clause 65.

 

Subclause (8) provides that if the amount of the contribution is recoverable, or has been recovered, under subclause (7), no amount is recoverable under clause 25 or clause 64 in relation to the same payment of contribution.

 

Clause 23   Who is liable to repay an overpayment of Level 2 Commonwealth contribution?

Subclause (1) provides that this clause applies, in relation to a Level 2 Commonwealth contribution that has been paid, if there is an amount overpaid as described in subclause 25(2) or 64(2).

 

Subclause (2) provides that the liable person, in relation to the amount overpaid, is:

      if the contribution has not been dealt with in accordance with whichever of subclauses 22(3) and (4) applies—the recipient referred to in subclause 22(1); or

      if the contribution has been dealt with in accordance with whichever of those subclauses applies—the midwife referred to in subclause 22(1).

 

The note explains that the recipient and the midwife will be the same person if the contribution was paid to the midwife.

 

Subclause (3) provides that if:

      the recipient and the midwife referred to in subclause 22(1) are not the same person; and

      when the overpayment is recovered as a debt, the liable person is the recipient;

the fact the recipient may later deal with the remainder of the contribution in accordance with subclause 22(3) or (4) does not mean that the overpayment should instead have been recovered from the midwife.

 

Subdivision C Payments that would have reduced the amount paid out under the contract of insurance

 

Clause 24   Amounts paid before payment of Level 2 Commonwealth contribution

Clause 24 provides for amounts, which reduce the amount that an insurer would pay for a claim, to be taken into account to reduce the amount of Level 2 Commonwealth contribution paid to the insurer.



Subclause (2) provides that this clause does not apply to any of the following:

      an amount paid to an insurer by another insurer under a right of contribution;

      a payment of Level 1 Commonwealth contribution;

      a payment of run-off cover Commonwealth contribution;

      an amount of a kind specified in the Rules for the purposes of this paragraph.

 

Clause 25   Amounts paid after payment of Level 2 Commonwealth contribution

This clause deals with circumstances when another payment is made in relation to a claim where Level 2 Commonwealth contribution has already been made, and that other payment is not taken into account when calculating the Level 2 Commonwealth contribution.  If the other payment had been taken into account and this would have reduced the Level 2 Commonwealth contribution payable, an overpayment arises which becomes a debt owed to the Commonwealth. 

 

Subclause (1) provides that this provision applies if:

      an amount (the actual contribution amount) of Level 2 Commonwealth contribution has been paid in relation to a qualifying liability that relates to a claim made against a person (the midwife); and

      another amount (not being an amount referred to in subclause (5)) is paid to the midwife, an eligible insurer or another person in relation to the incident to which the claim relates; and

      the other amount was not taken into account in calculating the actual contribution amount; and

      if the other amount had been so taken into account—a lesser amount (the reduced contribution amount, which could be zero) of Level 2 Commonwealth contribution would have been paid in relation to the liability.

 

Subclause (2) provides that the amount overpaid is the amount by which the actual contribution amount exceeds the reduced contribution amount.

 

Subclause (3) provides that if the Medicare Australia CEO has given the liable person (the recipient or midwife outlined in subclause 23(2)) a notice under clause 27(1) in relation to the amount overpaid, the amount is a debt owed to the Commonwealth by the liable person.

 

Note 1 explains that, if the contribution is or was not dealt with in accordance with whichever of subclauses 22(3) and (4) applies by the time required by subclause 22(5), the whole amount of the contribution is a debt owed by the recipient, and no amount is recoverable under this clause (see subclauses 22(6) to (8)).

 

Note 2 explains that if:

      the recipient and the midwife referred to in subclause 22(1) are not the same person; and

      the midwife becomes the liable person;

then, subject to subclause 22(3), the recipient ceases to be the liable person, and the amount overpaid must instead be recovered from the midwife.

 

Subclause (4) provides that the amount overpaid may be recovered:

      by action by the Medicare Australia CEO against the liable person in a court of competent jurisdiction; or

      under clause 65.

 

Subclause (5) provides that this new clause does not apply to any of the following:

      an amount paid to an eligible insurer by another insurer under a right of contribution;

      a payment of Level 1 Commonwealth contribution;

      a payment of run-off cover Commonwealth contribution;

      an amount of a kind specified in the Rules.

 

Clause 26   Obligation to notify the Medicare Australia CEO that amount has been paid

Subclause (1) provides that if:

      an amount of Level 2 Commonwealth contribution has been paid in relation to a qualifying liability that relates to a claim made against a person (the midwife) (paragraph (a)); and

      the person (the applicant) who applied for the or Level 2 Commonwealth contribution becomes aware that another amount has been paid to the midwife, an insurer or another person in relation to the incident or incidents to which the claim relates, or in relation to one or more other incidents (paragraph (b)); and

      because of the payment of the other amount, there is an amount overpaid as described in subclause 25(2) (paragraph (c));

the applicant must notify the Medicare Australia CEO that the other amount has been paid.

 

The note provides that failure to notify is an offence (see clause 67).

 

Subclause (2) provides that the notification must:

      be in writing (paragraph (a)); and

      be given to the Medicare Australia CEO within 28 days after the applicant becomes aware that the other amount has been paid (paragraph (b)).

 

Clause 27   The Medicare Australia CEO to notify of amount of debt due

This provision gives the Medicare Australia CEO the power to send a notice in circumstances where an overpayment is made.  The notice lets the recipient know that the overpayment is a debt owed to the Commonwealth and when it must be paid.

 

Subclause (1) provides that if:

      an amount of Level 2 Commonwealth contribution has been paid in relation to a qualifying liability that relates to a claim made against a person (the midwife) (paragraph (a)); and

      another amount is paid to the midwife, an insurer or another person in relation to the incident or incidents to which the claim relates, or in relation to one or more other incidents (paragraph (b)); and

      because of the payment of the other amount, there is an amount overpaid as described in subclause 25(2) (paragraph (c));

the Medicare Australia CEO may give the liable person (see subclause  23(2)) a written notice that specifies:

      the amount overpaid, and that it is a debt owed to the Commonwealth under subclause 25(3); and

      the day before which the amount must be paid to the Commonwealth; and

      the effect of clause 28.

 

The day specified under paragraph (e) must be at least 28 days after the day on which the notice is given.

 

Subclause (2) provides that the debt becomes due and payable on the day specified under paragraph (1)(e).

 

Clause 28  Penalty imposed if an amount is repaid late

This clause sets out when a person may be liable to pay a penalty for late repayment of a debt, and how that penalty is calculated.

 

Subclause (1) provides that if:

      a person owes a debt to the Commonwealth under subclause 25(3); and

      the debt remains wholly or partly unpaid after it becomes due and payable;

the person is liable to pay a late payment penalty under this clause.

 

Subclause (2) provides that the late payment penalty is calculated:

      at the rate specified in the Rules; and

      on the unpaid amount; and

      for the period:

-            starting when the amount becomes due and payable; and

-            ending when the amount and the penalty payable under this clause in relation to the amount have been paid in full.

 

A Rule is required to set a rate at which late payment penalty is calculated.

 

Subclause (3) provides that the Medicare Australia CEO may remit the whole or a part of an amount of late payment penalty if the Medicare Australia CEO considers that there are good reasons for doing so.

 

Subclause (4) provides that an application may be made to the Administrative Appeals Tribunal for review of a decision of the Medicare Australia CEO not to remit, or to remit only part of, an amount of late payment penalty.

 

The note explains that section 27A of the Administrative Appeals Tribunal Act 1975 requires notification of a decision that is reviewable.

 

Subclause (5) provides that if:

      the recipient and the midwife referred to in subclause 22(1) are not the same person; and

      the midwife becomes the liable person; and

      the recipient has or had a liability under this clause to pay late payment penalty;

the recipient’s liability to the late payment penalty is not affected by the fact that the recipient is no longer the person who owes the debt to the Commonwealth under subclause 25(3), except that the period referred to in paragraph (2)(c) ends when the midwife becomes the liable person.

 

Part 3 Run-off cover Commonwealth contributions

 

Division 1 Introduction

 

Clause 29   Guide to run-off cover Commonwealth contributions

This guide outlines that this Division provides for a run-off cover Commonwealth contribution to be paid in relation to a liability of an eligible midwife if the liability relates to an eligible run-off claim.  A table is also included which outlines where to find the provisions dealing with various issues.

 

Clause 31   Eligible run-off claims

This clause sets out the criteria that must be satisfied before a claim will be an eligible run-off claim. 

 

Subclause (1) sets out the following criteria that must be met for a claim to be an eligible run-off claim:

      the claim is made against a person who, at the time the claim is made, is a person to whom subclause (2) applies;

      it relates to incident that occurred on or after 1 July 2010 and on or before the run-off cover termination date in the course of, or in connection with, the person’s practice as an eligible midwife;

      in the event that the scheme is terminated, a person already eligible for the scheme would continue to have their claims covered by the terminated scheme until they cease to be eligible.  A person who would have become eligible after the termination date (if the scheme had not been terminated) would not become eligible;

      the person has midwife professional indemnity run-off cover that indemnifies the person in relation to the claim.

 

Subclause (2) provides for who will be covered by the scheme.  Some midwives will be eligible for the scheme permanently (until their estate is wound up) and others will be eligible temporarily - they are taken to have left the scheme when they no longer meet the eligibility criteria (for example, they return to private practice).

 

In general terms, the following midwifes will be covered by the scheme:

      retirees over 65;

      a person who has not engaged in private practice as an eligible midwife for three years;

      midwives on maternity leave;

      midwives who no longer practice because of permanent disability;

      the legal representative of a deceased midwife’s estate; and

      midwives included by the Rules. 

 

Classes of persons may be excluded by the Rules.

 

Subclause (3) provides that a person is taken to have ceased the person’s practice as a midwife because of maternity if and only if:

      the person is pregnant, or has given birth, or is recovering from a pregnancy (including a miscarriage or a stillbirth); and

      another person who is a medical practitioner has certified, in the form approved by the Medicare Australia CEO, that the person is pregnant, has given birth or is recovering from a pregnancy;

      the person has ceased all practice as a eligible midwife because

-            she is pregnant or

-            in order to care for the child/ren to whom she has given birth or

-            in order to recover from the pregnancy; and

      any other requirements specified in the Rules have been met.

 

Subclause (4) provides that a person is taken to have ceased the person’s practice as a midwife because of a permanent disability if and only if:

      the person has incurred an injury, or suffers from an illness, that is permanent or is likely to be permanent; and

      as a result of the injury or illness, the person can no longer practise the profession of midwifery; and

      another person who is a medical practitioner has certified that the person is has incurred an injury or suffers from an illness that is permanent or is likely to be permanent and can no longer practise as an eligible midwife; and

      the person has permanently ceased all practice as an eligible midwife.

 

Subclause (5) defines, for the purposes of clause 31, private practice as a midwife to mean practice as a midwife other than:

      practice consisting of treatment of public patients of a public hospital; or

      practice for which the Commonwealth, a State or a Territory, or a local governing body, or an authority established under a law of the Commonwealth, a State or a Territory indemnifies eligible midwives from liability relating to compensation; or

      practice indemnified from liability relating to compensation by the midwife’s employer; or

      practice conducted outside both Australia and the external Territories; or

      practice of a kind specified in the Rules.

 

Division 2 Run-off cover Commonwealth contributions

 

Clause 32   Circumstances in which run-off cover Commonwealth contributions are payable

This clause sets out the circumstances when Commonwealth run-off cover contributions are payable.

 

Subclause (1) provides that a Commonwealth run-off cover contribution is payable to an eligible insurer for an eligible run-off claim if:

      the claim relates to an incident that occurred in the course of or in connection with a person’s practice as an eligible midwife; and

      at the time the claim is first notified to the eligible insurer, the person is a person to whom subclause 31(2) applies; and

      the Medicare CEO has issued an apportionment certificate in relation to the claim, if applicable, or has not issued an apportionment certificate because of the operation of clause 52; and

      the eligible insurer would pay under contract while the person is eligible under clause 31(2); and

      the incident occurs, or occurred, on or after 1 July 2010 and on or before any run-off cover termination date; and

      the eligible insurer applies to the Medicare Australia CEO for the Commonwealth run-off cover contribution in accordance with clause 58; and

      the payment is consistent the terms of an apportionment certificate, if applicable.

 

Subclause (2) provides that paragraph (1)(d) does not apply to a payment that an eligible insurer makes, or is liable to make, unless the payment is or would be made:

      in relation to a claim made in relation to which the midwife concerned has midwife professional indemnity run-off cover; and

      in the eligible insurer’s ordinary course of business.

 

Clause 33  Clarification of circumstances in which run-off cover Commonwealth contributions are payable

This clause provides for a run-off cover Commonwealth contribution to be payable even if the claim is covered by reinsurance or the eligible insurer has paid an amount by an insurer in relation to the payment.

 

Clause 34   Exceptions

This clause provides that a run-off cover Commonwealth contribution is not payable to an eligible insurer if the payment is an insurer-to-insurer payment or the payment is a payment prescribed by the Rules for the purposes of this clause.

 

Clause 35   Amount of run-off cover Commonwealth contribution

The effect of this clause is that the amount of a run-off cover contribution is the amount of the payment referred to in paragraph 32(1)(d), but only to the extent the payment is or would be made: in relation to a claim for which the midwife has run-off cover, and in the eligible insurer's ordinary course of business.

 

Subclause (2) provides that if a run-off cover Commonwealth contribution is paid, the claim is first funded by the relevant Level 1 Commonwealth contribution or Level 2 Commonwealth contribution (or both), then any amount of the Commonwealth contribution in excess of the Level 2 threshold is funded by the run-off cover Commonwealth contribution.  This makes better use of the funding that is sourced from  the run-off cover scheme, and therefore minimises the tax that would have to be imposed through the Midwife Professional Indemnity (Run-off Cover Support Payment) Bill 2009.

 

Division 3 Payments that would have reduced the amount of run-off cover Commonwealth contribution

 

Clause 36  Amounts paid before run-off cover Commonwealth contribution

Clause 36 provides for amounts which reduce the amount that an insurer would pay for a claim to be taken into account to reduce the amount of run-off cover Commonwealth contribution paid to the insurer.

 

This clause does not apply to:

      an amount paid to an eligible insurer under a right of contribution;

      a payment of Level 1 Commonwealth contribution;

      a payment of Level 2 Commonwealth contribution; and

      an amount of a kind specified in the Rules for the purposes of this paragraph.

 

Clause 37   Amounts paid after payment of run-off cover Commonwealth contribution

Clause 37 deals with amounts paid after payment of a run-off cover contribution, that (if taken into account) would have reduced the amount of run-off cover contribution that would have been payable.  If the payment of those amounts means that run-off cover contribution has been overpaid, and the Medicare CEO notifies the eligible insurer of this, the insurer will owe the overpaid amount as a debt to the Commonwealth.

 

This clause does not apply to:

      an amount paid to an insurer by another insurer under a right of contribution, as specified in the Apportionment Certificate;

      a payment of Level 1 Commonwealth contribution;

      a payment of Level 2 Commonwealth contribution; and

      an amount of a kind specified in the regulations for the purposes of this paragraph.

 

Clause 38   Obligation to notify the Medicare Australia CEO that amount has been paid

Clause 38 provides that the insurer has an obligation to notify the Medicare Australia CEO in writing that another amount has been paid which has resulted in an overpayment described in subclause 37(2).  Notification must be given within 28 days after the applicant becomes aware of the overpayment.  Failure to notify is an offence.



Clause 39   The Medicare Australia CEO to notify of amount of debt due

Clause 39 provides for the Medicare Australia CEO to notify the insurer of the amount of an overpayment that is a debt due, and the due date for the payment of the debt.

 

Clause 40   Penalty imposed if an amount is repaid late

Clause 40 provides for a late payment penalty if the amount owing under subclause 37(3) is paid back late.  The payment is calculated at the rate specified in the Rules on unpaid amounts for the period commencing when the amount become due and payable and ending when the amount and the penalty on that amount has been paid in full. 

 

The Medicare Australia CEO may remit the whole or a part of an amount of late payment penalty if the Medicare Australia CEO considers that there are good reasons for doing so.  Such a decision is reviewable by the Administrative Appeals Tribunal.

 

Division 4 Effect of setting a run-off cover termination date

 

Clause 41  Commonwealth’s obligations if a run-off cover termination date is set

Clause 41 provides that, subject to the Rules setting out alternative arrangements, if a termination date is set for the run-off cover scheme the Commonwealth becomes liable to pay an amount in accordance with this Division in relation to affected eligible midwives.

 

Clause 42  Affected eligible midwife

Clause 42 provides that an eligible midwife is an affected eligible midwife if:

      a run-off cover termination date has been set;

      before the termination date, premiums have been paid for midwife professional indemnity cover for the eligible midwife for 12 months;

      the eligible midwife was not a person to whom subclause 31(2) applies.

 

Clause 43  Payments in relation to affected eligible midwife

This clause sets out when and to whom the Commonwealth is liable to make a payment in relation to affected eligible midwives.  These amounts:

      must be paid to a person who is nominated by the eligible midwife and has provided midwife professional indemnity cover for the eligible midwife under a contract of insurance;

      must be paid as all or part of the premium payable for the provision of that cover; and

      must be paid within 12 months after that date; and

      must not exceed the eligible midwife’s total run-off cover credit (see clause 44).

 

These amounts are payable out of the Consolidated Revenue Fund, which is appropriated accordingly.

 

Clause 44  Total run-off cover credits

Clause 44 sets out how to work out an affected eligible midwife’s total run-off cover credit.  Broadly, this will be equal to a percentage of the premiums paid under a contract of insurance to an eligible insurer for midwife professional indemnity cover and interest on those amounts.

 

Subclause (1) sets out a three step process for the calculation of the total run-off cover credit:

      Step 1:  For the first financial year after 30 June 2010, multiply the eligible midwife’s run-off cover credit for the financial year by the interest rate adjustment;

      Step 2:  For each subsequent financial year (if any) until the financial year in which the termination date occurs, multiply:

-            the sum of the eligible midwife’s run off cover credit for the financial year and the amount worked out under step or this step, for the immediately preceding financial year; by

-            the interest rate adjustment for the financial year;

      Step 3:  The total run-off cover credit is the total of:

-            the eligible midwife’s run-off cover credit for the financial year in which the run-off cover termination date occurs; and

-            the last of the amounts worked out under step 1 or step 2.

 

Subclause (2) provides that the eligible midwife’s run-off cover credit for a financial year is the sum of all run-off cover support payments that are attributable to the eligible midwife in relation to the financial year.

 

Subclause (3) provides that payments are attributable to the eligible midwife in the financial year if they relate to the premiums paid during the financial year to an eligible insurer for midwife professional indemnity cover provided for the eligible midwife by one or more contracts of insurance with the eligible insurer.

 

Subclause (4) sets out the interest rate adjustment for a financial year.  Broadly, this factor is 1 plus the applicable interest rate (that is, the amount set out in the Rules or, if no rate is specified, the short term bond rate for the June quarter immediately preceding the financial year).

 

The June quarter is defined to mean a period of 3 months commencing on 1 April.  The short term bond rate is also defined.

 

Clause 45  Eligible insurers must provide information attributing run-off cover support payments

Clause 45 requires an eligible insurer, in relation to a run-off cover support payment that the eligible insurer is liable to make, to give written notification to the Medicare Australia CEO of:

      each eligible midwife to whom the payment is attributable;

      for each such eligible midwife, each financial year in relation to which the payment is attributable; and

      for each such eligible midwife and financial year, the extent to which the payment is attributable to the midwife in relation to the financial year.

 

The notification must be given in writing before the payment day for the run-off cover support payment.

 

Division 5 Miscellaneous

 

Clause 46  Medicare Australia CEO must be notified of a person ceasing to be covered by the midwife run-off cover provisions

This clause requires the eligible insurer to notify the Medicare CEO, in writing, if a person ceases to be a person who is eligible for midwife professional indemnity run-off cover.

 

The notification must set out the details of the cessation and must be given within 61 days, or such greater number of days specified in the Rules.

 

Clause 47  Invoices for midwife professional indemnity cover

This clause provides that if an eligible insurer gives an invoice for midwife professional indemnity cover for which the insurer is liable to pay run-off cover support payment, the insurer must ensure the invoice states the total premium payable and the proportion and amount of the premium that represents a run-off cover support payment.

 

Clause 48  Reports on run-off cover Commonwealth provision

This clause requires the Minister to:

      cause a report to be prepared of the operation of this Part within 6 months after the end of the financial year; and

      cause a copy of the report to be tabled in each House of the Parliament within 15 sitting days of that House after its receipt by the Minister.

 

This report includes:

      the number of persons who were eligible for run-off cover indemnity at the end of the financial year;

      the amounts paid for run-off cover indemnity by the Commonwealth during the financial year;

      the total of all the amounts of run-off cover support payments remitted to the Commonwealth during the financial year; and

      estimates by the Actuary of the Commonwealth’s future liabilities.

This clause does not apply in relation to a financial year starting after any termination of the run-off cover scheme.

 

Clause 49  Modifications and exclusions

This clause provides for the Rules to modify the application of the Division in respect of claims, contracts of insurance, or specified classes of liabilities.  It also allows Rules to prescribe modifications regarding liabilities under an order of a court requiring an amount to be paid pending the outcome of an appeal.

 

It does not allow the Rules to modify a provision that creates an offence, or that imposes an obligation which, if contravened, constitutes an offence.

 

The power for these Rules to be made is required to allow the scheme to reflect the any emerging changes to the market for professional indemnity insurance.

 

The Rules will allow the scheme to respond to the industry's provision of new types of insurance products to cover new types of claims, and to respond to contracts and claims that are affected in an unintentional manner by the legislation.

 

Part 4 Administration of provisions relating to Commonwealth contributions

 

Division 1 Guide

 

Clause 50   Guide to this Part

This guide outlines that this Part provides for the administration of the Level 1 Commonwealth contributions, the Level 2 Commonwealth contributions and the run-off cover Commonwealth contributions.

 

Subclause (2) provides a table outlining where to find the provisions dealing with various issues.

 

Division 2 Apportionment certificates

 

Clause 51  When may the Medicare Australia CEO issue an apportionment certificate in relation to a claim?

This clause sets out the circumstances when the Medicare Australia CEO may issue an apportionment certificate in relation to a claim against a midwife.

 

Subclause (1) provides that the Medicare Australia CEO may issue an apportionment certificate if:

      either a qualifying claim certificate has been issued or the claim is an eligible run-off claim; and

      the Medicare CEO is satisfied that there is a person (other than the midwife or the eligible insurer) against whom a claim has been made, or is reasonably likely to be made, in relation to the incident to which the claim relates; and

      an application for the certificate has been made in accordance with clause 53.

 

Subclause (2) requires the certificate to specify the proportion of overall liability that should be attributed to the midwife and the other person or persons against whom a claim is being made for an incident.

 

Subclause (3) provides that, in relation to the other person or persons, the proportion of the overall liability may be specified for each of those persons individually or those persons taken as a group.  For example, the certificate could specify that a claim be paid out in the following proportions: 40% to the midwife, 60% to the hospital and medical practitioner, or 40% to the midwife, 40% to the medical practitioner and the remaining 20% to the hospital.

 

Subclauses (4), (5) and (6) provide that the proportion of the overall liability set out in the certificate may be the same or different to the proposed apportionment set out in the application.  The key consideration is whether the Medicare CEO is satisfied that the apportionment is reasonable.  In determining whether the apportionment is reasonable, the Medicare CEO may have regard to the information in the application and any other information that the Medicare CEO considers appropriate.

 

Subclause (7) operates to enable the Medicare CEO to make his or her decision having regard only to the information included in the application.

 

Subclause (8) provides that an apportionment certificate is not a legislative instrument.  This provision has been included to assist the reader, as the instrument would not be a legislative instrument within the meaning of section 5 of the Legislative Instruments Act 2003 .

 

Clause 52  Medicare CEO must not issue an apportionment certificate in certain situations relating to court judgments or orders

Subclause (1) provides that an apportionment certificate must not be issued if:

      a judgment or order of a court has been made in relation to the claim; and

      the judgment or order specifies the liability of the eligible midwife in relation to the claim

      the judgment or order is not stayed and is not subject to appeal; and

      the defence of the claim against the midwife was conducted appropriately.

 

Subclause (2) sets out the circumstances where a claim is conducted appropriately.

 

Subclause (3) defines defence of the claim to include any settlement negotiations on behalf of the midwife.

 

Clause 53  Applications for apportionment certificates

This clause provides that a claim made by the eligible insurer in relation to a claim must be in writing using a form approved by the Medicare Australia CEO and be accompanied by the documents and other information required by the form approved by the Medicare Australia CEO.

 

Clause 54  Time by which an application must be decided

This clause provides that the Medicare Australia CEO must make a decision on an application for the issue of an apportionment certificate on or before the 21st day after the day on which the application is received by the Medicare Australia CEO.  However, if the CEO requests a person to give information under clause 62, the CEO does not have to decide the application until 21 days after the day on which the person gives the information to the Medicare Australia CEO.

 

Clause 55  Obligation to notify the Medicare Australia CEO if information is incorrect or incomplete

This clause applies if an apportionment certificate is in force in relation to a claim, and a person becomes aware that the information provided to the Medicare Australia CEO in connection with the application for the certificate was incorrect or incomplete, or is no longer correct or complete.  This clause imposes an obligation on a person, who applied for an apportionment certificate or applied for a payment of Commonwealth contribution, to notify the Medicare Australia CEO of any information provided which was incorrect or incomplete, or is no longer correct or complete.  The notification must be made in writing and within 28 days after the person became aware.

 

Clause 56  Revocation and variation of apportionment claim certificates

This clause gives the Medicare Australia CEO the power to revoke or vary an apportionment certificate.

 

Revocation

Subclause (1) provides that the Medicare Australia CEO has the power to revoke an apportionment certificate if the Medicare Australia CEO is no longer satisfied for the purposes of subclauses 51(2) or (3).

 

Variation

Subclause (2) provides that the Medicare Australia CEO has the power to vary an apportionment certificate so that it correctly identifies or specifies the matter.

 

Effect of Revocation

Subclause (3) provides that an amount of Commonwealth contribution already paid in relation to a claim before the Medicare Australia CEO revokes an apportionment certificate will be an amount overpaid to which clause 64 applies.

 

Effect of Variation

Subclause (4) provides that if, as a result of a variation of an apportionment certificate, an amount that has already been paid exceeds the amount that would have been paid if the amount of Commonwealth contribution had been determined having regard to the certificate as varied, the amount of the excess is an amount overpaid to which clause 64 applies.

 

Medicare Australia CEO to give applicant copy of varied certificate

Subclause (5) provides that the Medicare Australia CEO must give a copy of the varied certificate within 28 days of making his or her decision.

 

Clause 57  AAT review of decision to issue, revoke or vary

This clause provides for review of the following decisions by the Administrative Appeals Tribunal:

      not to issue an apportionment certificate;

      specify a particular apportionment in an apportionment certificate; or

      revoke or vary an apportionment certificate.



Division 3 Applications for, and payment of, Commonwealth contribution

 

Clause 58  Application for Level 1 Commonwealth contribution or a Commonwealth run-off cover contribution

Clause 58 provides that an application by an eligible insurer for a Level 1 Commonwealth contribution or a run-off cover Commonwealth contribution must be made in writing using a form approved by the Medicare Australia CEO and be accompanied by documents and information required by the approved form.

 

Clause 59  Payment date for Level 1 Commonwealth contribution or a run-off cover Commonwealth contribution

This clause requires the Medicare Australia CEO to make a payment that is payable to an insurer before the end of the month that follows the month in which the insurer applied for the contribution or, if the Medicare Australia CEO requested information from a person under clause 62, the end of the month that follows the month in which the information in the request is provided to the Medicare Australia CEO.

 

This clause also provides that the Medicare Australia CEO does not have to decide the application for payment of a Level 1 Commonwealth contribution until the Medicare Australia CEO has decided the application for the issue of a qualifying claim certificate when both are received but not yet decided.

 

Clause 60   Application for Level 2 Commonwealth contribution

Subclause (1) provides that an application for a Level 2 Commonwealth contribution in relation to a qualifying liability that relates to a claim may be made by the person against whom the claim is or was made, or by a person acting on that person’s behalf.

 

Subclause (2) provides that the application must be made in writing using a form approved by the Medicare Australia CEO and be accompanied by the documents and other information required by the form approved by the Medicare Australia CEO.

 

Subclause (3) provides that subject to subclauses (4) and (5), the application cannot be made more than 28 days after:

      if the liability is under a judgment or order of a court—the date on which the judgment or order became or becomes a judgment or order that is not stayed and is not subject to appeal; or

      if the liability is under a settlement of the claim—the date on which the settlement agreement was entered into; or

      if the liability is some other kind of liability—the date on which the liability was incurred.

 

Subclause (4) provides that the Medicare Australia CEO may accept a late application if the Medicare Australia CEO considers that there are good reasons for doing so.

 

Subclause (5) provides that an application may be made to the Administrative Appeals Tribunal for review of a decision of the Medicare Australia CEO not to accept a late application.

The note explains that section 27A of the Administrative Appeals Tribunal Act 1975 requires notification of a decision that is reviewable.

 

Clause 61  Payment date for Level 2 Commonwealth contribution

 

Subclause (1) provides that, subject to subclauses (2) and (3), the Medicare Australia CEO is to decide an application for Level 2 Commonwealth contribution on or before the end of the 21st day after the day on which the application is received.

 

Subclause (2) provides that if the Medicare Australia CEO requests a person to give information under clause 62 in relation to an application for a Level 2 Commonwealth contribution, the Medicare Australia CEO does not have to decide the application until the 21st day after the day on which the person gives the information to the Medicare Australia CEO.

 

Subclause (3) provides that if the Medicare Australia CEO has received, but not yet decided on an application for a qualifying claim certificate and an application for a Level 2 Commonwealth contribution, the Medicare Australia CEO does not have to decide the application for payment of a Level 2 Commonwealth contribution until he or she has decided the application for the issue of a qualifying claim certificate.

 

Time by which payment must be made

Subclause (4) provides that if the Medicare Australia CEO decides to grant an application for a Level 2 Commonwealth contribution, the Medicare Australia CEO must pay the contribution to the applicant as soon as practicable after making that decision.

 

Division 4 Information gathering and record keeping

 

Clause 62   Medicare Australia CEO may request information

This clause provides that if the Medicare Australia CEO believes on reasonable grounds that a person is capable of giving information relevant to determining:

      whether a Commonwealth Contribution is payable;

      the amount of the Commonwealth contribution that is payable;

      whether a qualifying claim certificate or an apportionment certificate should be issued, varied or revoked; or

      the Commonwealth’s possible future liability to make Commonwealth contributions, or a particular kind of Commonwealth contributions;

he or she may request the person to provide the information (including records or copies of records maintained under clause 63).  

 

Subclause (2) provides for the persons from whom the Medicare Australia CEO can request information.

 

Subclause (3) provides for the Medicare Australia CEO to request a copy of a record, if the record is required to be kept under clause 63.

 

Subclause (4) allows the Medicare Australia CEO to request information periodically.

 

The request must be in writing, state what information is required, specify a day at least 28 days after the notice is given to comply, and state that a failure to comply with the request is an offence.

 

Clause 63   Main record keeping obligations

This clause requires a person who applies for a Commonwealth contribution to maintain relevant records, including on matters determined by the Medicare Australia CEO.  A person who applies for a qualifying claim certificate to maintain records relevant to satisfying the criteria in subclause 11(1) or (2) and any other matter determined by the Medicare Australia CEO.

 

The records must be maintained for five years after whichever is the later of the day on which the records were made or the day this legislation commenced.

 

A determination made by the Medicare Australia CEO must be published in the Gazette at least 14 days before the determination is to take effect.

 

The clause does not operate to have required a person to do anything before the commencement of this Bill.

 

Division 5 Overpayments of the contributions

 

Clause 64  Recovery of overpayments

This clause defines an amount overpaid as either an amount paid by way of a Commonwealth contribution to a person when a Commonwealth contribution was not payable, or an amount paid that was greater than the Commonwealth contribution that was payable, and provides that the amount overpaid is a debt due to the Commonwealth.

 

Subclause (4) provides that the amount overpaid may be recovered by action against the insurer in a court of competent jurisdiction, by deduction from the amount of a Level 1 Commonwealth contribution, a Level 2 Commonwealth contribution or a run-off cover Commonwealth contribution payable to the insurer, or under clause 65.  It also provides that the amount recovered must not exceed the amount overpaid.

 

Clause 65  Medicare Australia CEO may collect money from a person who owes money to a person

This clause provides for the recovery of a debt to the Commonwealth under clause 22(6), 25(3), 37(3), or 64(3) through garnishee action.

 

Subclause (2) provides for the Medicare Australia CEO to direct a third party who owes or may owe money to a liable person, to pay some or all of the money to the Medicare Australia CEO.  The Medicare Australia CEO must also provide a copy of the direction to the liable person.

 

Subclause (3) provides that the direction cannot require an amount to be paid to the Medicare Australia CEO at a time before it becomes owing by the third party to the liable person.

 

Subclause (4) provides that if:

      the repayment or overpayment debt relates to a Level 2 Commonwealth contribution; and

      the recipient and the midwife referred to in subclause 22(1) are not the same person; and

      the midwife because the liable person; and

      the direction was given to the recipient;

the direction ceases to have effect when the midwife becomes the liable person.

 

Subclauses (5) and (6) provide that it is an offence of strict liability for the third party to fail to comply with the direction unless they comply with the direction so far as they are able to do so.

 

Subclause (7) provides that a court may order a person convicted of an offence under subclause (5) to pay the Commonwealth an amount up to the amount involved in the failure to comply as well as imposing a penalty.

 

Subclause (8) indemnifies the third party for any payment made under the clause.

 

Subclauses (9) and (10) require the Medicare Australia CEO to give immediate notice to the third party if the debt due to the Commonwealth is fully or partly discharged before the third party has made a payment.  If the debt is partly discharged, the Medicare Australia CEO must vary the direction under subclause (2).

 

Subclause (11) defines the circumstances in which a third party is taken to owe money to an insurer.

 

Division 6 Offences

 

Clause 66  Failing to give information

This clause provides that a person who fails to comply with a request under subclause 62(1) commits an offence of strict liability.  A person is excused from complying with the request if to do so would tend to incriminate them or expose them to a penalty.

 

Clause 67  Failing to notify

This clause provides that a person who fails to notify the Medicare Australia CEO under clauses 26 or 38 within a particular period commits an offence of strict liability.

 

Clause 68  Failing to keep and retain records

This clause provides that a person who fails to keep and maintain records as required by clause 63 commits an offence of strict liability.



Clause 69  Failing to include required information in invoices

This clause provides that a person commits an offence if the person is an eligible insurer, and the person gives an invoice to another person and the invoice does not state the matters required by clause 47.

 

Division 7 Finance

 

Clause 70  Appropriation

This clause provides that the Consolidated Revenue Fund is appropriated for the purpose of paying Level 1 Commonwealth contributions, Level 2 Commonwealth contributions and run-off cover Commonwealth contributions.

 

Division 8—Reinsurance contracts

 

Clause 71  Commonwealth contributions disregarded for purposes of reinsurance contracts

Subclause (1) provides that a contract of insurance between two insurers governed by the laws of a State or Territory has effect as if the contract provided that Commonwealth contributions and insurers’ rights to Commonwealth contributions were to be disregarded for the purposes of the contract, and in particular in working out amounts payable under the contract by the insurer providing the insurance.

 

Subclause (2) provides that subclause (1) applies to a contract entered into on or after the commencement of this Bill.

 

Subclause (3) provides that subclause (1) applies to a contract entered into before the commencement of this Bill.

 

Chapter 3 Run-off cover support payments

 

Part 1 Introduction

 

Clause 72  Guide to this Chapter

Subclause (1) outlines that this Chapter provides for the payment of run-off cover support payments and the administration of run-off cover support payments.

 

Subclause (2) provides that the proposed Midwives’ Professional Indemnity (Run-off cover Support Payment) Act 2009 :

      imposes payments on eligible insurers for contribution years; and

      specifies the amount of those payments (by reference to an eligible insurer’s premium income for the contribution year)

 

Subclause (3) includes a table setting out where to locate provisions within this Chapter.



Part 2 Payment of run-off cover support payment

 

Clause 73  Who is liable to pay the run-off cover support payment?

This clause provides that a person is liable to pay a run-off cover support payment for a financial year that is a contribution year if they were an eligible insurer and not exempt under clause 74.

 

Clause 74  Exemptions

This clause provides that a person is exempt from run-off cover support payments in circumstances specified in the Rules.  The Rules may provide that a person is exempt from run-off cover support payment either generally or for a particular contribution year.

 

Clause 75  When run-off cover support payment must be paid

The clause provides that a run-off cover support payment becomes due and payable on 30 June in the contribution year, or such other day as is specified in the Rules.

 

Clause 76  Late payment penalty

This clause provides that if an amount of contribution payable by a person remains wholly or partly unpaid after it becomes due for payment, the person is liable to pay a late payment penalty calculated at the prescribed rate on the unpaid amount, from the date the contribution was due for payment until the day the unpaid contribution and the late payment penalty are paid in full.

 

Subclause (3) allows the Medicare Australia CEO to remit a late payment penalty in whole or in part, and subclause (4) provides for a review by the Administrative Appeals Tribunal of a decision by the Medicare Australia CEO not to remit a late payment penalty or to remit only part of a late payment penalty.

 

Clause 77  Method of paying certain amounts

This clause provides that a run-off cover support payment and a late payment penalty payable under clause 76 must be paid to the Medicare Australia CEO.  The Rules may specify methods for paying these amounts.

 

Clause 78  Refund of overpaid amounts

This clause provide that if a person overpays an amount of run-off cover support payment or a late payment penalty for a contribution year, the overpaid amount must be refunded unless the amount has been previously repaid to the person in accordance with an authorisation under section 33 of the Financial Management and Accountability Act 1997

 

Subclause (2) provides that the Consolidated Revenue Fund is appropriated for the purpose of providing a refund under this clause.



Clause 79  Recovery of payment debt

This clause provides that an amount of run-off cover support payment and a late payment penalty under clause 76 are debts due to the Commonwealth and may be recovered by the Medicare Australia CEO in a court of competent jurisdiction.

 

Clause 80  Medicare Australia CEO may collect money from a person who owes money to a person

This clause provides for the recovery of a debt to the Commonwealth under clause 79 through garnishee action.

 

Subclause (2) provides for the Medicare Australia CEO to direct a third party, who owes or may owe money to a liable person, to pay some or all of the money to the Medicare Australia CEO.  The Medicare Australia CEO must also provide a copy of the direction to the liable person.

 

Subclause (3) provides that the direction cannot require an amount to be paid to the Medicare Australia CEO at a time before it becomes owing by the third party to the liable person, nor specify a period of less than 14 days within which the third party must comply with the direction.

 

Subclauses (4), (5) and (6) provide that it is an offence of strict liability for the third party to fail to comply with the direction unless they comply with the direction so far as they are able to do so.

 

Subclause (7) provides that a court may order a person convicted of an offence under subclause (4) to pay the Commonwealth an amount up to the amount involved in the failure to comply as well as imposing a penalty.

 

Subclause (8) indemnifies the third party for any payment made under the clause.

 

Subclauses (9) and (10) require the Medicare Australia CEO to give immediate notice to the third party if the debt due to the Commonwealth is fully or partly discharged before the third party has made a payment.  If the debt is partly discharged, the Medicare Australia CEO must vary the direction under subclause (2).

 

Subclause (11) defines the circumstances in which a third party is taken to owe money to the payment debtor.

 

Clause 81  Evidentiary certificates

This clause allows the Medicare Australia CEO to issue a written certificate that a person is liable to pay a run-off cover support payment or a late payment penalty in relation to a run-off cover support payment setting out the particulars of that liability, and provides that the certificate is prima facie evidence of the matters in the certificate in any civil proceedings under this Bill.

 

Subclause (3) provides that a document purporting to be a certificate must be taken to be a certificate and to have been properly issued unless the contrary is established.



Subclauses (4) and (5) allow the Medicare Australia CEO to issue a certified copy of a certificate and provide that it is to be treated as if it were the original.

 

Part 3 Information gathering provisions

 

Clause 82  Medicare Australia CEO may request information

This clause provides that if the Medicare Australia CEO believes on reasonable grounds that a person is capable of giving information relevant to determining whether a person is liable to pay a run-off cover support payment, and if so how much, or whether a person has midwife professional indemnity cover, it may request the person to provide the information.

               

This clause is based on the equivalent provision in the Medical Indemnity Act 2002 , which provides similar schemes to subsidise the medical indemnity insurance of medical professionals. 

 

The request must be in writing, state what information is required, specify a day at least 28 days after the notice is given to comply, and state that a failure to comply with the request is an offence.

 

Clause 83  Medicare Australia CEO must be notified of a change in circumstances etc.

This clause provides that a person who is exempt from the payment of a run-off cover support payment because of particular circumstances must notify the Medicare Australia CEO in writing within 28 days of the occurrence of a change in circumstances affecting their exemption.

 

Clause 84  Failing to give information

This clause provides that a person who fails to comply with a request under subclause 82(1) commits an offence of strict liability.  A person is excused from complying with the request if to do so would tend to incriminate them or expose them to a penalty.

 

Clause 85  Failing to notify

This clause provides that a person who fails to notify the Medicare Australia CEO within a particular period under clause 83 commits an offence of strict liability.

 

Chapter 4 Miscellaneous

 

Clause 86  General administration of this Act and Midwife Professional Indemnity (Run-off Cover Support Payment) Act 2009

This clause provides that the Medicare Australia CEO has the general administration of this Bill and the proposed Midwife Professional Indemnity (Run-off Cover Support Payment) Act 2009 .

 

Clause 87  Additional functions of the Medicare Australia CEO

This clause provides that the Medicare Australia CEO has such functions, additional to those under the Medicare Australia Act 1973 , as are conferred on it under this Bill and the proposed Midwife Professional Indemnity (Run-off Cover Support Payment) Act 2009 .

 

Clause 88  Officers to observe secrecy

Subclause (1) defines various terms used in the clause.  

 

It defines protected information as information obtained by a person to whom the clause applies (being a person who is or was an officer) in the course of their duties or the exercise of their powers and functions under the midwife professional indemnity legislation, and relates to a person’s affairs. 

 

It defines a protected document as a document that contains protected information.

 

Subclause (2) provides that a person to whom the clause applies commits an offence if they copy, disclose or produce protected information or a protected document to another person other than in the performance of their duties or the exercise of their powers and functions, or to enable another person to perform functions under certain Commonwealth legislation.

 

Subclause (3) provides that, despite subclause (2), the Secretary or the Medicare Australia CEO may divulge protected information to a person if the Minister certifies that it is necessary in the public interest, or may divulge protected information to a person who the Minister believes is expressly or impliedly authorised to obtain it by the person to whom the information relates.

 

Subclause (4) provides that, despite subclause (2), the Secretary or the Medicare Australia CEO may divulge protected information of a kind prescribed in regulations to a person or authority prescribed in regulations.

 

Subclause (5) provides that any person or authority, or person or employee under the control of a person or authority, who receives information under subclauses (3) and (4), is subject to subclause (2).

 

Subclause (6) provides that the clause does not prohibit divulging or communicating to a person information that relates to them.

 

Clause 89  Act not to apply in relation to State insurance within a State

This clause provides that the Bill does not extend to State insurance within a State.

 

Clause 90  Minister may make Rules

This clause gives the Minister the power to make Rules providing for matters required or permitted to be made by this Bill or necessary or convenient to be provided in order to carry out or give effect to the Bill.

 

The Rules may apply, adopt or incorporate with or without modification, any matter contained in any other instrument or writing.



Clause 91  Regulations

This clause allows the Governor-General to make regulations prescribing matters required or permitted to be prescribed under the Bill, or necessary or convenient to be prescribed for carrying out or giving effect to the Bill, including prescribing penalties not exceeding 10 penalty units (i.e. $1,100) for offences against the regulations.



MIDWIFE PROFESSIONAL INDEMNITY (RUN-OFF COVER SUPPORT PAYMENT) BILL 2009

 

notes on clauses

 

Clause 1  Short title

This clause sets out the short title for the Bill, once enacted.

 

Clause 2  Commencement

This clause sets out that the Bill, once enacted, commences on 1 July 2010.

 

Clause 3  Definitions

This clause defines terms used in the Bill, or indicates where else in the Bill terms are defined.

 

Clause 4  Imposition of run-off cover support payment

This clause imposes the run-off cover support payment as a tax on each eligible insurer for each contribution year.

 

Clause 5  Contribution year

This clause provides for each financial year, or other period of 12 months specified in the Rules, that starts on or after 1 July 2010 to be a contribution year.

 

The Rules may specify different periods for a particular insurer or class of insurer.

 

Clause 6  Amount of run-off cover support payment

This clause provides for the amount of the run-off cover support payment imposed on an eligible insurer for a contribution year as a percentage of the insurer’s premium income for the period of 12 months ending on 31 May in each contribution year, or such other period as specified in Rules.

 

The percentage is 15% or such lower percentage as is specified in the Rules (which may specify different percentages for a particular eligible insurer).  The Government intends to amend the percentage to 10% by Rules.  This is consistent with the initial rate of contribution for the Run-off Cover Scheme for medical practitioners.  The Government will contribute $5 million to the Run-off Cover Scheme pool, and the remainder will be contributed by this tax.

 

Clause 7  Premium income

This clause provides that premium income for a period is the sum of all premiums paid during the period to the eligible insurer for midwife professional indemnity cover provided for eligible midwives by contracts of insurance with the insurer, and includes the sum of all amounts paid to the insurer during the period that are amounts of a kind specified in the Rules .

 

Subclause (2) provides that the amount of an eligible insurer’s premium income for a period excludes certain amounts.  It excludes relevant amounts of GST, stamp duty and amounts specified in Rules where they relate to the make up of the premium. 

Amounts worked out using the formula in subclause (3) are also excluded.

 

Clause 8  Rules

This clause confers power on the Minister to make Rules providing for matter required or permitted by the Bill to be provided in the Rules, or necessary or convenient to be provided in order to carry out or give effect to the Bill.

 

Clause 9  Regulations

This clause allows the Governor-General to make regulations prescribing matters required or permitted by the Bill, or necessary or convenient to be provided in order to carry out or give effect to the Bill.