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Paying for doctor's past mistakes?

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01 October 2003


Blaming the Australian Government for making doctors leave public hospitals for private practice is unfair and misleading, Minister for Revenue and Assistant Treasurer, Senator Helen Coonan said today.

"While today's announcement that five doctors will leave Western Sydney Hospitals is disappointing, half-truths and scare tactics about the medical indemnity situation are counterproductive," Senator Coonan said.

"The question is -should general taxpayers pay for claims against doctors for past negligent treatment of patients?

"The Medical Defence Organisation UMP was run in ways that excluded scrutiny from the regulator and premiums were set at such a low level that insufficient thought had been given to how liabilities would be met in the future.

"The Government was asked to rescue the doctors' Medical Defence Organisation UMP rather than let it go into liquidation leaving doctors personally liable and the injured facing the prospect of not getting any compensation.

"The taxpayer has underpinned the rescue package through the Government's assumption of responsibility for the $460 million in UMP's unfunded liabilities and through $353 million of subsidies and exemptions for doctors.

"However, taxpayers cannot be expected to foot all the bills for claims against UMP for negligence of doctors. That is why the levy scheme is in place, after full consultation with the medical profession. It was a condition of the rescue operation.

"Doctors' groups claim high levy amounts, quoted in the hundreds and thousands of dollars, will lead to a sharp rise in fees. The truth of the matter is 80 per cent of doctors will pay less than $1500 and 93 per cent of doctors will pay less than $5000 per year and the levy is tax deductible.

"A number of doctors are altogether exempt from the levy, including retired doctors over the age of 65 who earn less than $5000 a year in medical income. There are also a range of taxpayer funded subsidies which significantly reduce the levy.

The Government has also significantly reformed the national negligence landscape during the last 18 months of negotiations at the six meetings of State and Territory Ministers responsible for insurance of which Senator Coonan is Chair.

"Although this will address and reduce negligence claims going forward, it will not redress those claims that were incurred before the changes. That is why it is important to give doctors a chance to meet this amount over time," Senator Coonan said.