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Medical Indemnity Amendment Bill 2004
Schedule 2 Payment and collection

   

Medical Indemnity Act 2002

1  Subsection 4(1)

Insert:

invoice includes:

                     (a)  any document issued by an MDO to a person (whether or not the person is already a member of the MDO) that contains a quote for the amount of subscription that is or would be payable by that person for membership of the MDO; and

                     (b)  any document issued by a medical indemnity insurer to a person (whether or not the medical indemnity insurer already provides medical indemnity cover to the person) that contains a quote for the amount of premium that is or would be payable by that person for provision of such cover.

2  Subsection 4(1) (paragraph (b) of the definition of late payment penalty )

Omit “or a lump sum payable under section 64”.

3  Subsection 4(1) (at the end of the definition of late payment penalty )

Add:

             ; and (c)  in relation to an amount that a medical indemnity insurer or an MDO is required to remit to the HIC under paragraph 66A(4)(b)—means a penalty payable under section 66B.

4  Subsection 4(1)

Insert:

medical indemnity insurer means a body corporate that:

                     (a)  is authorised under section 12 of the Insurance Act 1973 to carry on insurance business in Australia; and

                     (b)  in carrying on that business, enters into contracts of insurance providing medical indemnity cover for other persons.

5  Subsection 50(3) (table item 7, column 3)

Omit “to 63”, substitute “and 62”.

6  Subsection 50(3) (table item 8)

Repeal the item.

7  Subsection 50(3) (table item 9, column 3)

Omit “section 65”, substitute “sections 65 and 66B”.

8  Subsection 50(3) (table item 10, column 3)

Omit “section 66”, substitute “sections 66 and 66A”.

9  Paragraph 52(2)(e)

Repeal the paragraph.

10  Subsection 60(2) (table item 1, column 3)

Omit “to 63”, substitute “and 62”.

11  Subsection 60(2) (table item 2)

Repeal the item.

12  Subsection 60(2) (table item 3, column 3)

Omit “section 65”, substitute “sections 65 and 66B”.

13  Subsection 60(2) (table item 4, column 3)

Omit “section 66”, substitute “sections 66 and 66A”.

14  Section 61

Omit “sections 62, 63 and 64”, substitute “section 62”.

15  Sections 63 and 64

Repeal the sections.

16  Paragraph 65(1)(a)

Repeal the paragraph, substitute:

                     (a)  a person is liable to pay a medical indemnity payment; and

17  Paragraph 65(1)(b)

Omit “or lump sum”.

18  Paragraph 65(2)(b)

Omit “or lump sum”.

19  Subparagraphs 65(2)(c)(i) and (ii)

Omit “or lump sum” (wherever occurring).

20  Subsection 66(1)

Repeal the subsection, substitute:

             (1)  A medical indemnity payment must be paid:

                     (a)  if the payment is all or part of a payment of an amount specified in an invoice, issued under section 66A by a medical indemnity insurer or an MDO, as an amount of UMP support payment that is payable—to the medical indemnity insurer or MDO; or

                     (b)  in any other case—to the HIC.

21  Subsection 66(2)

Repeal the subsection.

22  Subsection 66(3)

After “section 65”, insert “or 66B”.

23  Subsection 66(4)

Omit “, (2)”.

24  At the end of section 66

Add:

             (5)  Paragraph (1)(a) does not apply to an amount recovered under section 68.

25  After section 66

Insert:

66A   Collection of UMP support payments by medical indemnity insurers and MDOs

When this section applies to a UMP support payment

             (1)  This section applies to a UMP support payment for a contribution year that is payable by a person if, at a time before the end of the contribution year:

                     (a)  either:

                              (i)  a medical indemnity insurer gives to the person an invoice stating the premium that is or will be payable for medical indemnity cover provided by a contract of insurance with the medical indemnity insurer; or

                             (ii)  subparagraph (i) does not apply, but an MDO gives to the person an invoice stating the subscription that is or will be payable for membership of the MDO; and

                     (b)  before that invoice was given to the person, the HIC gave to the medical indemnity insurer or MDO a notice under subsection (2); and

                     (c)  that invoice is the first invoice that the medical indemnity insurer or MDO has given to the person, relating to the premium or subscription, since the HIC gave the notice.

The medical indemnity insurer or MDO is the collection body for the UMP support payment.

HIC may give notice of liability to pay UMP support payment

             (2)  The HIC may give to the collection body a notice that:

                     (a)  states that the person is liable to pay a UMP support payment for the contribution year; and

                     (b)  states the amount of UMP support payment that the person is liable to pay; and

                     (c)  states the basis on which the amount of UMP support payment was worked out; and

                     (d)  asks the collection body to include in its notice to the HIC under paragraph (4)(c) other specified information, being information that:

                              (i)  the HIC believes on reasonable grounds the collection body is capable of giving; and

                             (ii)  the HIC believes on reasonable grounds that it requires for the purpose of determining the amount that the collection body must remit to the HIC under paragraph (4)(b); and

                     (e)  states that this section applies to the collection of the payment.

             (3)  The HIC must not give a notice under subsection (2) if:

                     (a)  the person has already paid the UMP support payment to the HIC, or has already been notified by the HIC of his or her liability to pay the UMP support payment; or

                     (b)  the person has notified the HIC in writing that he or she does not wish this section to apply to the collection of UMP support payments that he or she is liable to pay.

What the collection body for a UMP support payment must do

             (4)  The collection body for the UMP support payment must:

                     (a)  in the next invoice that the collection body gives to the person for payment of a premium for medical indemnity cover or for payment of a membership subscription, include an amount for payment, to the collection body, of the UMP support payment; and

                     (b)  within the period referred to in subsection (5), remit to the HIC any amount that the person pays to the collection body under paragraph 66(1)(a) in discharge of the person’s liability to pay the UMP support payment; and

                     (c)  within that period, notify the HIC in writing:

                              (i)  who made the payment; and

                             (ii)  the amount of the payment; and

                            (iii)  if the payment was made after the payment day for the UMP support payment under section 61—the day on which the payment was made; and

                     (d)  include in the notice under paragraph (c) any other information that the HIC has, in its notice to the collection body under subsection (2), asked the collection body to include.

Note:          Failure to comply with paragraph (a), (c) or (d) is an offence (see section 74A).

             (5)  The period for remitting an amount to the HIC under paragraph (4)(b), and notifying the HIC under paragraphs (4)(c) and (d), is the period starting on the day on which the amount is paid to the collection body and ending:

                     (a)  if the amount is paid on or before the payment day for the UMP support payment under section 61—on that payment day; or

                     (b)  if the amount is paid after that payment day—7 days after the day on which the amount is paid.

Effect of payment to collection body

             (6)  A person’s liability to the Commonwealth to pay UMP support payment is discharged to the extent that the amount of the payment is paid to the collection body under paragraph 66(1)(a).

Collection body entitled to interest etc.

             (7)  If an amount is paid to the collection body under paragraph 66(1)(a), the collection body:

                     (a)  may, prior to remitting the amount to the HIC under paragraph (4)(b) of this section, invest the amount on deposit with an ADI; and

                     (b)  is entitled to any interest payable on the amount so deposited.

             (8)  In paragraph (7)(a):

ADI (authorised deposit-taking institution) means a corporation that is an ADI for the purposes of the Banking Act 1959 .

             (9)  The Consolidated Revenue Fund is appropriated to the extent necessary for the purposes of subsection (7).

66B   Late payment penalty for medical indemnity insurers and MDOs

             (1)  If:

                     (a)  a medical indemnity insurer or an MDO (the collection body ) is liable under paragraph 66A(4)(b) to remit an amount to the HIC; and

                     (b)  all or part of the amount has not been remitted to the HIC within the period referred to in subsection 66A(5);

the collection body is liable to pay a late payment penalty under this section.

             (2)  The late payment penalty is calculated:

                     (a)  at the prescribed rate; and

                     (b)  on the unpaid amount of the amount to be remitted; and

                     (c)  for the period:

                              (i)  starting when the amount becomes due and payable; and

                             (ii)  ending when the amount, and the penalty payable under this section in relation to the amount, have been paid in full.

             (3)  The HIC may remit the whole or a part of an amount of late payment penalty if the HIC considers that there are good reasons for doing so.

             (4)  An application may be made to the Administrative Appeals Tribunal for review of a decision of the HIC not to remit, or to remit only part of, an amount of late payment penalty.

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

26  After paragraph 67(1)(b)

Insert:

                 or (c)  a late payment penalty in relation to an amount that a medical indemnity insurer or an MDO is required to remit to the HIC under paragraph 66A(4)(b);

27  Subsection 67(1)

Omit “or the person makes an election under subsection (2)”.

28  Subsections 67(2) and (3)

Repeal the subsections.

29  Subsection 68(2)

Repeal the subsection, substitute:

             (2)  An amount that a medical indemnity insurer or an MDO is required to remit to the HIC under paragraph 66A(4)(b) is a debt due to the Commonwealth.

30  Subsection 68(3)

After “section 65”, insert “or 66B”.

31  Subparagraph 70(1)(a)(ii)

Repeal the subparagraph.

32  Subparagraph 70(1)(a)(iii)

Omit “and”, substitute “or”.

33  After subparagraph 70(1)(a)(iii)

Insert:

                            (iv)  a late payment penalty in relation to an amount that a medical indemnity insurer or an MDO is required to remit to the HIC under paragraph 66A(4)(b); and

34  After paragraph 71(1)(b)

Insert:

                 or (c)  whether a person has medical indemnity cover provided by a contract of insurance with a particular medical indemnity insurer; or

                     (d)  whether a person is a member of a particular MDO;

35  After section 74

Insert:

74A   Failing to comply with requirements for collecting UMP support payments

             (1)  This section applies if a medical indemnity insurer or an MDO is required to comply with paragraph 66A(4)(a), (c) or (d).

             (2)  The medical indemnity insurer or MDO commits an offence if the medical indemnity insurer or MDO fails to comply with the requirement.

Penalty:  30 penalty units.

             (3)  An individual is excused from complying with the request if the giving of the information might tend to incriminate the individual or expose the individual to a penalty.

             (4)  An offence against this section is an offence of strict liability.

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