AMA Indemnity Bulletin 3

2 July, 2003

Following further discussions with the State Government, a number of breakthroughs have been achieved. These include:

VMP's: Public Patient Service

1. Clause 2.2 Indemnity Agreement Exclusions

The Government has agreed to a protocol to review attempts to deny indemnity to an individual in the circumstances detailed in Clause 2.2. A review panel with a medical majority comprising the Chief Medical Officer, a departmental legal representative and a representative of AMA (WA) will be established and to an extent mirror the traditional private MDO discretionary cover process. This will ensure that there will be no capricious use of the clause and the onus will be on the Government to establish at law why the clause should apply. Both AMA and MDO experience over many years in relation to salaried doctors is such that exclusions are only ever applied in exceptional circumstances and we believe that with the added protection of the protocol this will continue to be the case.

2. Indemnity of Practitioners who have not signed the Indemnity Agreement by 1st August 2003 but continue to provide services

Government has now agreed that Doctors who continue to provide services after 1st July 2003 and sign an Indemnity Agreement by 1st August 2003 will automatically be indemnified.

If the Doctor does not sign, the Government has also agreed that for services provided during July 2003 to a public patient in a public hospital that the Minister for Health / Attorney General will recommend to Cabinet that the indemnity be provided as if the Indemnity Agreement had been signed. This statement has also been made by the Minister in the Media and put in writing to the Association. Whilst in a strictly legal sense it does not provide an absolute guarantee, the likelihood of Government not honouring the Minister's commitment is extremely improbable.

In any event the Practitioner has the option of signing the Indemnity Contract prior to 1st August 2003 to secure the indemnity and then resigning as an added level of security.

3. Application of indemnity to incorporated practices

It has been confirmed to the AMA that: "in the unlikely event that a claim being made against a sole practitioner body corporate or sole practitioner and partner (or similar) body corporate, in respect of the conduct of the medical practitioner employed by or who is a director of such a company" in respect to public patients that the Minister will again recommend to Cabinet that indemnity be provided in the same manner and subject to the same conditions as if the indemnity agreement had been signed by the body corporate. The Association has been advised that the Department will recommend an ex gratia payment for any reasonable expenses incurred in seeking to dispose of a claim against the body corporate and have it against the individual only. This should protect Directors of such companies including spouses serving in such capacities.

4. Quality / Safety / Consent

The Government has agreed that the application of the requirements of the MSA and Indemnity Agreement will be undertaken with the advice of the MAC. This should ensure that requirements reflect contemporary medico legal practice and are not applied unreasonably.

5. Private Doctors who have dropped procedural private cover and taken out "Non Procedural" private medical indemnity cover for 2003/04

Government has now confirmed that where the Doctor does not raise a bill to the following categories of private patient: workers' compensation, MVIT, DVA, seamen and overseas patients, because they have dropped their private procedural private cover, that for those patients, they will be regarded as public patients for the purposes of the indemnity and the Doctor will be remunerated by the hospital as if they are "public patients" - provided the doctor only bills the hospital. The Doctor will not be covered by the Government for standard private patients who do not fall within the above categories.

6. Blue Sky

The Government has responded previously to the Associations submissions to remove the limit on the amount of indemnity they will provide which originally they proposed to be $15 million. Unlike private MDOs' which provide $20 million, it is now unlimited. This provides better cover than private MDOs'.

7. DDR Cover

The State Government has also previously accepted the AMA submissions that under the VMP Indemnity Agreement they will be indemnified on an ongoing basis ie up to 24 years for public patients.

In addition the Governments VMP cover extends to claims arising in relation to services provided prior to 1st July 2003 from when the practitioners MDO policy changed from "claims occurring" to "claims made" and the claims have not been notified to the MDO (Clause 5). This provides cover in many instances from 1 July 1997 onwards and is a significant concession particularly given the removal of the Blue Sky problem and ongoing DDR Cover.

Salaried Practitioners: General

Government has confirmed that:

1. Arrangement A - The indemnity arrangements which apply generally to salaried practitioners treating public patients extends to salaried practitioners employed under "Arrangement A" who treat private patients.

2. Arrangement B / Sessional - Where the practitioner has dropped their private procedural cover the Government has accepted that for the following: workers' compensation, MVIT, DVA, seaman and overseas patients, that for those patients, they be regarded as public patients for the purposes of the indemnity and the Doctor will be remunerated by the hospital as if they are "public patients" - provided the doctor only bills the hospital. The Doctor will not be covered by the Government where the Doctor bills standard private patients who do not fall within those categories.

Government has also agreed to address outstanding concerns of salaried practitioners as a priority.

Significant progress has been made. Given the requirements of the Trade Practices Act and the difference in individual circumstances, each Doctor will need to make up their own mind on whether the Government indemnity is sufficient.

Dr Bernard Pearn-Rowe
AMA (WA) President