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Midwife Professional Indemnity (Commonwealth Contribution) Scheme Bill 2010

Part 4 Administration of provisions relating to Commonwealth contributions

Division 1 Guide

50   Guide to this Part

             (1)  This Part makes provision for the administration of provisions relating to Level 1 Commonwealth contributions, Level 2 Commonwealth contributions and run-off cover Commonwealth contributions.

             (2)  The following table tells you where to find the provisions dealing with various issues:

 

Where to find the provisions on various issues

Item

Issue

Provisions

1

when may the Medicare CEO issue an apportionment certificate?

section 51

2

how do people apply for apportionment certificates?

section 53

3

how do people apply for Level 1 Commonwealth contributions and Commonwealth run-off cover contributions?

section 58

4

when are Level 1 Commonwealth contributions and Commonwealth run-off cover contributions paid?

section 59

5

how do people apply for Level 2 Commonwealth contributions?

section 60

6

when are Level 2 Commonwealth contributions paid?

section 61

7

what information has to be given to the Medicare Australia CEO?

section 62

8

what records must eligible insurers keep?

section 63

9

how are overpayments of Commonwealth contribution recovered?

section 64



 

Division 2 Apportionment certificates

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

             (1)  The Medicare Australia CEO may issue a certificate (an apportionment certificate ) in relation to a claim against a midwife if:

                     (a)  either:

                              (i)  a qualifying claim certificate has been issued by the Medicare CEO in relation to the claim; or

                             (ii)  the claim is an eligible run-off claim; and

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

                     (c)  an application for the certificate has been made in accordance with section 53.

             (2)  The apportionment certificate must specify the proportion of the overall liability in relation to the incident that is to be attributed to:

                     (a)  the midwife; and

                     (b)  the other person or persons against whom the Medicare CEO is satisfied a claim has been, or is reasonably likely to be, made in relation to the incident.

             (3)  For the purposes of paragraph (2)(b), if there is more than one other person against whom the Medicare CEO is satisfied a claim has been or is reasonably likely to be made, the proportion of the overall liability may be specified for:

                     (a)  each of those persons individually; or

                     (b)  those persons taken as a group.

             (4)  The proportion of the overall liability specified in the apportionment certificate may be the same as the apportionment proposed in the application if the Medicare CEO is satisfied that the proposed apportionment is reasonable.

             (5)  The apportionment certificate may be different from the apportionment proposed in the application if the Medicare CEO is satisfied that the alternative apportionment is reasonable.

             (6)  For the purposes of being satisfied that an apportionment is reasonable, the Medicare CEO may have regard to:

                     (a)  the information provided with the application; and

                     (b)  any other information that the Medicare CEO considers appropriate.

             (7)  However, the Medicare CEO is not required to have regard to any information beyond the information that was included in the application.

             (8)  An apportionment certificate is not a legislative instrument.

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

             (1)  The Medicare Australia CEO must not issue an apportionment certificate in relation to a claim against an eligible midwife if:

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

                     (b)  the judgment or order specifies the liability of the eligible midwife in relation to the claim; and

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

                     (d)  the defence of the claim against the midwife was conducted appropriately (see subsection (2)) up to the date on which the judgment or order became a judgment or order that is not stayed and is not subject to appeal.

             (2)  For the purposes of paragraph (1)(d), the defence of the claim is conducted appropriately if, and only if:

                     (a)  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

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

             (3)  In this section:

defence of the claim includes any settlement negotiations on behalf of the midwife.

53   Applications for apportionment certificates

             (1)  An eligible insurer in relation to a claim made against a midwife must apply for the issue of an apportionment certificate in relation to the claim if the eligible insurer considers that there is a person other than the midwife against whom a claim has been, or is reasonably likely to be, made in relation to the incident to which the claim relates.

             (2)  The application must:

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

                     (b)  must specify the proportion of the overall liability in relation to the incident to which the claim relates that the applicant proposes be attributed to:

                              (i)  the midwife; and

                             (ii)  the other person or persons against whom a claim has been, or is reasonably likely to be made in relation to the incident to which the claim relates; and

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

             (3)  For the purposes of subparagraph (2)(b)(ii), if there is more than one other person against whom a claim has been or is reasonably likely to be made, the proportion of the overall liability may be specified for:

                     (a)  each of those persons individually; or

                     (b)  those persons taken as a group.

54   Time by which an application must be decided

             (1)  Subject to subsection (2), the Medicare Australia CEO is to decide 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.

             (2)  If the Medicare Australia CEO requests a person to give information under section 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.

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

             (1)  If:

                     (a)  an apportionment certificate is in force in relation to a claim; and

                     (b)  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

                     (c)  the person is:

                              (i)  the person who applied for the certificate; or

                             (ii)  another person who has applied for a payment of 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.

Note:          Failure to notify is an offence (see section 67).

             (2)  The notification must:

                     (a)  be made in writing; and

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

56   Revocation and variation of apportionment certificates

Revocation

             (1)  The Medicare Australia CEO may revoke an apportionment certificate if the Medicare Australia CEO is no longer satisfied as mentioned in subsection 51(4) or (5) in relation to the claim.

             (2)  The Medicare CEO must revoke an apportionment certificate if, after the apportionment certificate is issued:

                     (a)  a judgment or order of a court is made; and

                     (b)  the judgment or order is of a kind that would have prevented the Medicare CEO issuing an apportionment certificate under section 52, had it been made before the certificate was issued.

Variation

             (3)  If the Medicare Australia CEO is satisfied that a matter is not correctly identified or specified in an apportionment certificate, the Medicare Australia CEO may vary the certificate so that it correctly identifies or specifies the matter.

Effect of revocation

             (4)  If:

                     (a)  the Medicare Australia CEO revokes an apportionment certificate; and

                     (b)  an amount of Commonwealth contribution has already been paid in relation to the claim;

the amount is an amount overpaid to which section 64 applies.

Effect of variation

             (5)  If:

                     (a)  the Medicare Australia CEO varies an apportionment certificate; and

                     (b)  an amount of 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 Commonwealth contribution had been determined having regard to the certificate as varied;

the amount of the excess is an amount overpaid to which section 64 applies.

Medicare Australia CEO to give applicant copy of varied certificate

             (6)  If the Medicare Australia CEO decides to vary an apportionment certificate, the Medicare Australia CEO must, within 28 days of making his or her decision, give the applicant a copy of the varied certificate. However, a failure to comply does not affect the validity of the decision.

57   AAT review of decision to issue, revoke or vary

                   An application may be made to the Administrative Appeals Tribunal for review of a decision of the Medicare Australia CEO:

                     (a)  not to issue an apportionment certificate; or

                     (b)  to specify a particular apportionment in an apportionment certificate; or

                     (c)  to revoke or vary an apportionment certificate.

Note:          Section 27A of the Administrative Appeals Tribunal Act 1975 requires notification of a decision that is reviewable.



 

Division 3 Applications for, and payment of, Commonwealth contribution

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

                   An application by an eligible insurer for a Level 1 Commonwealth contribution or a run-off cover Commonwealth contribution must:

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

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

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

             (1)  Subject to subsections (2) and (3), the Medicare Australia CEO must pay a Level 1 Commonwealth contribution or a run-off cover Commonwealth contribution that is payable to an insurer before the end of the month that immediately follows the month in which the eligible insurer applies for the contribution.

             (2)  If:

                     (a)  an insurer applies for a Level 1 Commonwealth contribution or a run-off cover Commonwealth contribution; and

                     (b)  the Medicare Australia CEO requests a person to give information under section 62 in relation to the application; and

                     (c)  the person does not give the Medicare Australia CEO the information requested before the end of the month that immediately follows the month in which the insurer applies for the contribution; and

                     (d)  a Level 1 Commonwealth contribution or a run-off cover Commonwealth contribution is payable to the insurer;

the Medicare Australia CEO must pay the Level 1 Commonwealth contribution or a run-off cover Commonwealth contribution to the insurer before the end of the month that immediately follows the month in which the person gives the Medicare Australia CEO the requested information.

             (3)  If the Medicare Australia CEO has received, but not yet decided:

                     (a)  an application for the issue of a qualifying claim certificate in relation to a claim; and

                     (b)  an application for a Level 1 Commonwealth contribution in relation to the same claim;

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.

             (4)  In this section:

month means one of the 12 months of the year.

60   Application for Level 2 Commonwealth contribution

             (1)  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.

             (2)  The application must:

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

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

             (3)  Subject to subsection (4), the application cannot be made more than 28 days after:

                     (a)  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

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

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

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

             (5)  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.

Note:          Section 27A of the Administrative Appeals Tribunal Act 1975 requires notification of a decision that is reviewable.

61  Payment date for Level 2 Commonwealth contribution

Time by which application must be decided

             (1)  Subject to subsections (2) and (3), the Medicare Australia CEO is to decide an application for a Level 2 Commonwealth contribution on or before the end of the 21st day after the day on which the application is received by the Medicare Australia CEO.

             (2)  If the Medicare Australia CEO requests a person to give information under section 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.

             (3)  If the Medicare Australia CEO has received, but not yet decided:

                     (a)  an application for the issue of a qualifying claim certificate in relation to a claim; and

                     (b)  an application for a Level 2 Commonwealth contribution in relation to the same claim;

the Medicare Australia CEO does not have to decide the application for payment of a Level 2 Commonwealth contribution until the Medicare Australia CEO has decided the application for the issue of a qualifying claim certificate.

Time by which payment must be made

             (4)  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

62   Medicare Australia CEO may request information

             (1)  If the Medicare Australia CEO believes on reasonable grounds that a person is capable of giving information that is relevant to determining:

                     (a)  whether a Commonwealth contribution is payable; or

                     (b)  the amount of the Commonwealth contribution that is payable; or

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

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

the Medicare Australia CEO may request the person to give the Medicare Australia CEO the information.

Note:          Failure to comply with the request is an offence (see section 66).

             (2)  Without limiting subsection (1), any of the following persons may be requested to give information under that subsection:

                     (a)  an insurer;

                     (b)  a person who practises, or used to practise, as an eligible midwife;

                     (c)  a person who is acting, or has acted, on behalf of a person covered by paragraph (b);

                     (d)  the legal personal representative of a person covered by paragraph (b) or (c).

             (3)  Without limiting subsection (1), if the information sought by the Medicare Australia CEO is information relating to a matter in relation to which a person is required by section 63 to keep a record, the Medicare Australia CEO may request the person to give the information by giving the Medicare Australia CEO the record, or a copy of the record.

             (4)  Without limiting paragraph (1)(d), the Medicare Australia CEO may request an insurer to give information under that paragraph on a periodic basis.

             (5)  The request:

                     (a)  must be made in writing; and

                     (b)  must state what information must be given to the Medicare Australia CEO; and

                     (c)  may require the information to be verified by statutory declaration; and

                     (d)  must specify the day on or before which the information must be given; and

                     (e)  must contain a statement to the effect that a failure to comply with the request is an offence.

The day specified under paragraph (d) must be at least 28 days after the day on which the request is made.

63   Main record keeping obligations

Records to be kept by person who applies for payment

             (1)  A person who applies for a Commonwealth contribution must keep records relevant to the following matters:

                     (a)  the payability of the contribution;

                     (b)  the amount of the contribution payable;

                     (c)  any amount paid to the person that results in a person being liable to pay an amount under section 25 or 37;

                     (d)  any other matter determined by the Medicare Australia CEO.

Note:          Failure to keep the records is an offence (see section 68).

Records to be kept by person who applies for a qualifying claim certificate

             (2)  A person who applies for the issue of a qualifying claim certificate in relation to a claim must keep records that are relevant to the following:

                     (a)  matters related to whether the criteria specified in subsection 11(1) or (2) are satisfied in relation to the claim;

                     (b)  any other matter determined by the Medicare Australia CEO.

Note:          Failure to keep the records is an offence (see section 68).

Records to be retained for certain period

             (3)  The records must be retained for a period of 5 years (or any other period specified in the Rules) starting on the later of:

                     (a)  the day on which the records were created; or

                     (b)  the day on which this Act commenced.

Note:          Failure to retain the records is an offence (see section 68).

Determination of additional matters to be gazetted

             (4)  A determination by the Medicare Australia CEO under paragraph (1)(d) or (2)(b) is not a legislative instrument. The determination must:

                     (a)  be published in the Gazette; and

                     (b)  not take effect earlier than 14 days after the day on which it is published in the Gazette.

Retrospective effect not intended

             (5)  Nothing in this section is to be taken to have required a person to do an act or thing before the commencement of this Act.



 

Division 5 Overpayments of the contributions

64   Recovery of overpayments

             (1)  This section applies if an amount is paid by way of a Commonwealth contribution and:

                     (a)  the amount of Commonwealth contribution is not payable; or

                     (b)  the amount paid is greater than the amount of the Commonwealth contribution that was payable.

             (2)  The amount overpaid is:

                     (a)  the whole of the amount paid if paragraph (1)(a) applies; or

                     (b)  the difference between the amount that was paid and the amount that was payable if paragraph (1)(b) applies.

             (3)  The amount overpaid is a debt due to the Commonwealth by the liable person. For this purpose the liable person is:

                     (a)  if the Commonwealth contribution was a Level 1 Commonwealth contribution or a run-off cover Commonwealth contribution—the insurer to which the payment was made; or

                     (b)  if the Commonwealth contribution was a Level 2 Commonwealth contribution—the person who is the liable person under subsection 23(2).

Note 1:    Paragraph (b)—if the Level 2 Commonwealth contribution is or was not dealt with in accordance with whichever of subsections 22(3) and (4) applies by the time required by subsection 22(5), the whole amount of the contribution is a debt owed by the recipient, and no amount is recoverable under this section (see subsections 22(6) to (8)).

Note 2:    Paragraph (b)—if:

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

(b)    the midwife becomes the liable person;

                then (subject to subsection 23(3)), the recipient ceases to be the liable person, and the amount overpaid must instead be recovered from the midwife.

             (4)  The amount overpaid may be recovered:

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

                     (b)  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 liable person; or

                     (c)  under section 65.

The total amount recovered must not exceed the amount overpaid.

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

What this section does

             (1)  This section allows the Medicare Australia CEO to collect money from a person who owes money to a person (the liable person ) who has a debt to the Commonwealth under subsection 22(6), 25(3), 37(3) or 64(3) (the repayment or overpayment debt ).

The Medicare Australia CEO may give direction

             (2)  The Medicare Australia CEO may direct a person (the third party ) who owes, or may later owe, money (the available money ) to the liable person to pay some or all of the available money to the Medicare Australia CEO in accordance with the direction. The Medicare Australia CEO must give a copy of the direction to the liable person.

Limit on directions

             (3)  The direction must:

                     (a)  not 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; and

                     (b)  specify a period of not less than 14 days within which the third party must comply with the direction.

             (4)  If:

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

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

                     (c)  the midwife becomes the liable person; and

                     (d)  the direction was given to the recipient;

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

Third party to comply

             (5)  The third party commits an offence if the third party fails to comply with the direction.

Penalty:  20 penalty units.

             (6)  The third party does not commit an offence against subsection (5) if the third party complies with the direction so far as the third party is able to do so.

Note:          A defendant bears an evidential burden in relation to the matter in this subsection (see subsection 13.3(3) of the Criminal Code ).

             (7)  An offence against subsection (5) is an offence of strict liability.

Note:          For strict liability, see section 6.1 of the Criminal Code .

Court orders

             (8)  If a person is convicted of an offence in relation to a failure of the third party to comply with subsection (5), the court may (in addition to imposing a penalty on the convicted person) order the convicted person to pay to the Commonwealth an amount up to the amount involved in the failure of the third party.

Indemnity

             (9)  Any payment made by the third party under this section is taken to have been made with the authority of the liable person and of all other persons concerned and the third party is indemnified for the payment.

Notice

           (10)  If the whole of the repayment or overpayment debt of the liable person is discharged before any payment is made by the third party, the Medicare Australia CEO must immediately give notice to the third party of that fact.

           (11)  If a part of the repayment or overpayment debt of the liable person is discharged before any payment is made by the third party, the Medicare Australia CEO must:

                     (a)  immediately give notice to the third party of that fact; and

                     (b)  make an appropriate variation to the direction; and

                     (c)  give a copy of the varied direction to the liable person.

When third party is taken to owe money

           (12)  The third party is taken to owe money to the liable person if:

                     (a)  money is due or accruing by the third party to the liable person; or

                     (b)  the third party holds money for or on account of the liable person; or

                     (c)  the third party holds money on account of some other person for payment to the liable person; or

                     (d)  the third party has authority from some other person to pay money to the liable person;

whether or not the payment of the money to the liable person is dependent on a pre-condition that has not been fulfilled.



 

Division 6 Offences

66   Failing to give information

             (1)  This section applies if a person is given a request for information under subsection 62(1).

             (2)  The person commits an offence if the person fails to comply with the request.

Penalty:  30 penalty units.

             (3)  An offence against subsection (2) is an offence of strict liability.

Note:          For strict liability, see section 6.1 of the Criminal Code .

67   Failing to notify

             (1)  This section applies if section 14, 26, 38, 45, 46 or 55 requires a person to notify the Medicare Australia CEO of a matter within a particular period.

             (2)  The person commits an offence if the person fails to notify the Medicare Australia CEO of the matter within that period.

Penalty:  30 penalty units.

             (3)  An offence against subsection (2) is an offence of strict liability. However, strict liability does not apply to the physical element described in paragraph 26(1)(b) or 38(1)(b).

Note:          For strict liability, see section 6.1 of the Criminal Code .

68   Failing to keep and retain records

             (1)  This section applies if section 63 requires a person to keep records or to retain records for a particular period.

             (2)  The person commits an offence if the person fails to keep the records or fails to retain the records for that period.

Penalty:  30 penalty units.

             (3)  An offence against subsection (2) is an offence of strict liability.

Note:          For strict liability, see section 6.1 of the Criminal Code.

69   Failing to include required information in invoices

             (1)  This section applies if section 47 applies to an invoice that an eligible insurer gives to a person.

             (2)  A person commits an offence if:

                     (a)  the person is an eligible insurer; and

                     (b)  the person gives such an invoice to another person; and

                     (c)  the invoice does not state the matters required by section 47.

Penalty:  30 penalty units.

             (3)  An offence against subsection (2) is an offence of strict liability.

Note:          For strict liability, see section 6.1 of the Criminal Code .

             (4)  To avoid doubt, subsection 4B(3) of the Crimes Act 1914 applies to any offence against this section committed by a body corporate, as if an offence against that provision could be committed by a natural person.

             (5)  Subsection (4) does not affect the meaning of any other offence against this Act.



 

Division 7 Finance

70   Appropriation

                   The Consolidated Revenue Fund is appropriated for the purposes of paying:

                     (a)  Level 1 Commonwealth contributions; and

                     (b)  Level 2 Commonwealth contributions; and

                     (c)  run-off cover Commonwealth contributions.



 

Division 8 Reinsurance contracts

71   Commonwealth contributions disregarded for purposes of reinsurance contracts

             (1)  If:

                     (a)  a contract is a contract of insurance between 2 insurers; and

                     (b)  the contract is governed by the laws of a State or Territory;

the contract has effect as if the contract provided, and had at all times provided, that:

                     (c)  Commonwealth contributions; and

                     (d)  insurers’ rights to Commonwealth contributions;

were to be disregarded for all purposes and, without limiting this, were to have no effect on the amounts payable under the contract by the insurer providing the insurance.

             (2)  By force of this subsection, subsection (1) applies to a contract if it is entered into on or after the commencement of this Act.

             (3)  By force of this subsection, subsection (1) applies to a contract if it was entered into before the commencement of this Act.