Federal Register of Legislation - Australian Government

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Schemes as made
This Scheme specifically allows doctors covered by medical indemnity providers that are not medical indemnity insurers (as defined) but provide medical indemnity cover to be eligible to receive subsidies through their organisation similar to other doctors.
Administered by: Health
Registered 30 Jun 2006
Tabling HistoryDate
Tabled HR08-Aug-2006
Tabled Senate08-Aug-2006

 

Premium Support (Medical Indemnity Provider) Scheme 2006

 


I, TONY ABBOTT, Minister for Health and Ageing, formulate this Scheme under subsection 43(1) of the Medical Indemnity Act 2002.

 

Dated_________________20/6/2006

 

                            T Abbott____

Minister for Health and Ageing

 

 


Contents

 

Part 1                   Preliminary                                                                                           4

1.           Name of Scheme [see Note 1]                                                                  4

2.           Commencement                                                                                      4

3.           The Scheme                                                                                           4

4.           Definitions                                                                                               4

5.           Approved manner and timeframes                                                             4

6.           Premium period                                                                                       4

Part 2                   PSS contract                                                                                         5

7.           The Commonwealth may enter into contracts                                             5

8.           Matters to be included in PSS contracts                                                    5

9.           Inconsistent obligations                                                                            5

10.          Accrued rights and obligations                                                                  5

Part 3                   Eligible medical practitioners                                                               7

11.          Eligibility for subsidy to be paid on behalf of medical practitioners                7

12.          Eligible members                                                                                     8

12A.       Medical practice outside Australia                                                            8

13.          Conditions for medical practitioners                                                           9

13A.       Members not invoiced for UMP support payment                                     10

Part 4                   Calculating the amount of subsidy                                                      11

14.          PSS calculation                                                                                     11

15.          Rural calculation                                                                                    11

16.          [Not used]                                                                                             11

17.          MISS calculation                                                                                   11

18.          Amount of subsidy                                                                                 11

19.          Calculation where change of circumstances in premium period                  12

20.          Calculation where a member has received a subsidy under the MISS         12

21.          Calculation for period 1 January to 30 June 2004                                       12

22.          Calculation for members with a MISS entitlement where actual income not provided    13

23.          [Not used]                                                                                             13

24.          Gross indemnity costs                                                                           13

25.          Actual income                                                                                       14

Part 5                   Advance subsidy                                                                                 15

26.          Application for advance subsidy                                                              15

27.          Payment of advance subsidy                                                                  15

28.          Adjustments of advance subsidy                                                             16

29.          Reconciling amounts paid                                                                       16

30.          Failure to make application or provide information                                     17

Part 6                   Final determination of subsidy                                                            18

31.          Application where advance subsidy paid                                                  18

32.          Application where advance subsidy not paid                                             18

33.          Form of application                                                                                18

34.          Determination where advance subsidy paid                                              19

35.          Repayment of advance subsidy                                                               19

36.          Determination where no advance subsidy paid                                          19

37.          Time for making payments of subsidy                                                      20

38.          Incorrect payments                                                                                20

39.          Former contractors                                                                                20

Part 7                   Conditions for the contractor                                                               21

40.          Conditions to be satisfied                                                                       21

Part 8                   Administration fee                                                                               22

41.          Eligibility                                                                                               22

42.          Application                                                                                            22

43.          Calculation                                                                                            22

44.          Determination                                                                                        22

45.          Payment                                                                                               23

46.          Non-compliance with conditions                                                              23

Part 9                   Miscellaneous                                                                                     24

47.          Review of decisions                                                                                24

48.          Information obtained by the Medicare Australia CEO                                 25

49.          Disclosure of information                                                                        25

50.          Offsetting debts                                                                                     25

51.          Repayment of subsidy by a medical practitioner                                       25

Part 10                 General list of definitions                                                                    26

52.          Definitions                                                                                             26

Schedule                                                                                                                         29

1.           MISS methodology                                                                                29

2.           Interpretation                                                                                         29

3.           Neurosurgeons                                                                                      30

4.           Specialist obstetricians                                                                          30

5.           Procedural general practitioners – non-rural                                              30

6.           Procedural general practitioners – rural                                                    31

7.           Procedural general practitioner registrars                                                 31

 

 


Part 1        Preliminary

1.                      Name of Scheme [see Note 1]

This Scheme is the Premium Support (Medical Indemnity Provider) Scheme 2006.

2.                      Commencement

This Scheme commences on the day after it is registered.

Note   This Scheme provides for payments to be made in respect of medical indemnity cover provided on or after 1 January 2004 – see item 21 of Schedule 3 of the Medical Indemnity Legislation Amendment Act 2005.

3.                      The Scheme

(1)        This Scheme provides for the making of payments of subsidies to:

(a)                    medical indemnity providers on behalf of medical practitioners where the medical indemnity provider agrees to administer this Scheme by entering into a PSS contract for the purposes of this Scheme; and

(b)                   contracted medical indemnity providers  to help them meet the cost of administering this Scheme.

Note   'medical indemnity provider' and 'medical practitioner' are defined in Part 10.

4.                      Definitions

The general list of definitions for this Scheme is at Part 10.

5.                      Approved manner and timeframes

Where:

(a)                    this Scheme requires something to be done in a manner or within a timeframe approved by the Medicare Australia CEO or the Secretary; and

(b)                   the PSS contract sets out the manner or the timeframe in which that thing is to be done,

the requirement in the PSS contract is taken to be the manner or the timeframe approved by the Medicare Australia CEO or the Secretary, as the case requires, in which the thing is to be done.

6.                      Premium period

Where the context permits, references in this Scheme to a ‘premium period’ include part of a premium period.

Part 2        PSS contract

7.                      The Commonwealth may enter into contracts

(1)        The Commonwealth may enter into a contract (the PSS contract) with a medical indemnity provider for the purposes of this Scheme.

(2)        If a contract for the purposes of this Scheme is executed before the commencement of this Scheme, the contract is taken to have been entered into under subsection (1).

(3)        For the avoidance of doubt, a PSS contract may be amended from time to time in accordance with its terms.

8.                      Matters to be included in PSS contracts

(1)        A PSS contract must include conditions that must be satisfied for the payment of a subsidy to the following effect:

(a)                    that the obligations of a contractor under the contract apply only in relation to a medical practitioner who has informed the contractor that he or she agrees to participate in the Scheme; and

(b)                   that acknowledges:

(i)                      the premium charged by the contractor to a member is a debt due to the contractor from the member; and

(ii)                     the member is responsible for payment of a premium, although this responsibility may be satisfied in part by a subsidy being paid by the Medicare Australia CEO under this Scheme to the contractor on behalf of the member in respect of that premium.

(2)        A PSS contract may provide that the Medicare Australia CEO will pay to the contractor (subject to compliance with this Scheme) an administration fee in respect of the administrative obligations imposed on the contractor by this Scheme.

(3)        Subsections (1) and (2) do not limit the conditions or other matters that may be included in a PSS contract, provided they do not contradict a requirement referred to in those subsections.

9.                      Inconsistent obligations

If compliance with a PSS contract by a contractor, or the Commonwealth (the parties) would result in non-compliance, or an inconsistency, with the Act or this Scheme, the party or parties, as the case may be, must not comply with that obligation, but the non-compliance with that obligation does not affect other obligations of the parties under the contract.

10.                  Accrued rights and obligations

The rights and obligations accrued under a PSS contract survive the termination or expiry of the contract.

Note   Section 39 deals with former contractors.

Part 3        Eligible medical practitioners

11.                  Eligibility for subsidy to be paid on behalf of medical practitioners

(1)        Subject to this Scheme, a medical practitioner who:

(a)                    is an eligible member; and

(b)                   complies with the conditions in section 13,

is eligible for a premium period for a subsidy to be paid to a contractor on his or her behalf in accordance with this Scheme.

(2)        For the avoidance of doubt, an eligible member is not eligible to be paid a subsidy:

(a)                    directly; or

(b)                   at any time when a PSS contract with a contractor to which the member owes a premium is not in force, other than where there are accrued liabilities for payment under a PSS contract which continue after termination or expiry of the PSS contract; or

(c)                    where the contractor has not complied with the conditions set out in this Scheme or the PSS contract for the payment of subsidy on behalf of a member.

(3)        If for a premium period:

(a)                    a subsidy has been paid under this Scheme to a contractor on behalf of an eligible member; or

(b)                   a liability to pay a medical indemnity provider a subsidy on behalf of an eligible member has arisen under a terminated or expired PSS contract,

the member is not eligible to have a subsidy paid on his or her behalf to another contractor in respect of the same period unless the contractor has repaid, or caused to repay, the amount of the subsidy to the Medicare Australia CEO.

Note   The eligible member must repay to the first contractor the amount the contractor had to repay to the Medicare Australia CEO – see section 51.

(4)        If a subsidy has been paid under this Scheme to the contractor on behalf of a member and the member has not complied with a condition in paragraphs 13 (1) (c) or (d) on a UMP support payment, the member:

(a)                    ceases to be eligible for the subsidy for the whole premium period to which the non-payment of the UMP support payment relates; and

(b)                   is not eligible for a subsidy for any further premium period (being a whole premium period) until the liability is discharged.

(5)        If a subsidy has been paid to a contractor on behalf of a member for a premium period and the member has not paid to the contractor, on demand of the contractor, the full amount of any subsidy paid to the contractor which the contractor is required to repay to the Medicare Australia CEO under this Scheme, the member ceases to be eligible for a subsidy to be paid on his or her behalf for the whole of that premium period and any further premium period until the member has repaid to the contractor the outstanding amount.

Note   The medical practitioner may be required to repay the contractor in accordance with section 51.

(6)        If a member has received a payment under the MISS which relates to medical indemnity cover for any period on or after 1 January 2004, the member is not eligible to be paid a subsidy under this Scheme for the same period of the medical indemnity cover otherwise than in accordance with section 20.

12.                  Eligible members

(1)        A medical practitioner who is a member with a MISS entitlement for a premium period is an eligible member and, for the purposes of determining the amount of subsidy under this Scheme, may be an eligible member in one of the following categories for a premium period:

(a)                    a member whose gross indemnity costs for a premium period exceed 7.5% of the member’s actual income or, where a calculation is being made as to the amount of an advance subsidy, 7.5% of the member’s estimated income; or

(b)                   a procedural general practitioner practising in a rural area; or

(c)                    a member with a MISS entitlement.

(2)        A member is a member with a MISS entitlement for a premium period if the member received a subsidy under the MISS and either:

(a)                    the member has, since the MISS ceased to be in force, continuously practised in the speciality group which qualified the member for subsidy under the MISS on 30 June 2004; or

(b)                   if the member has ceased practising in that speciality group because the member is on maternity leave or other leave and resumes practice in that speciality group within 12 months of the day on which he or she ceased so to practise.

12A.      Medical practice outside Australia

(1)        If a member's contract of insurance for a premium period provides medical indemnity cover for the practice of his or her medical profession carried on outside Australia or both in and outside Australia, subsection (2) applies to the member.

(2)        The member is not eligible for subsidy under this Scheme:

(a)                    if the member's contract of insurance provides medical indemnity cover only for the practice of his or her medical profession carried on outside Australia; or

(b)                   where the member's contract of insurance provides medical indemnity cover for the practice of his or her medical profession carried on both in and outside Australia, if the member has practised as a medical practitioner outside Australia for a total of six months or more during the premium period.

Note   Section 22 of the Acts Interpretation Act 1901 defines 'month'.

(3)        The six-month period referred to in subsection (2) includes leave taken in the ordinary course of medical practice (such as holiday or illness), but does not include any other absence from practice as a medical practitioner.

(4)        For subsection (2), if during a premium period, a member practises outside Australia in one of the circumstances referred to in the Medical Indemnity Regulations 2003 for the purposes of paragraph 34E (1) (c) of the Act, the practice is taken to be practice in Australia for that premium period.

Note   The Medical Indemnity Regulations 2003 refer to incidents (1) involving Australian citizens or residents which occur outside Australia while the person and medical practitioner are on a sporting, cultural or official tour, or (2) where the practitioner is undertaking aid work outside Australia and the incident involves that work.

13.                  Conditions for medical practitioners

(1)        The conditions with which an eligible member must comply for a premium period are:

(a)                    the member has consented to the contractor receiving payments, if any, under this Scheme on behalf of the member; and

(b)                   the member has given to the contractor or the Medicare Australia CEO the information requested by the contractor or the Medicare Australia CEO in the form and within the period of time required by the contractor or the Medicare Australia CEO; and

Note   The Medicare Australia CEO may request information under section 44 of the Act.

(c)                    if the member has a liability for a UMP support payment and:

(i)                      the payment day has not been deferred under the Act; and

(ii)                     the payment day is in the premium period,

the member has paid that amount within the date specified in subsection (2); and

(d)                   if the member has a liability for a UMP support payment and:

(i)                      the payment day has been deferred under the Act; and

(ii)                     the deferred payment day is in the premium period,

the member has paid that amount not later than 2 months after the deferred payment day; and

(e)                    the member has paid the contractor an amount that equals the amount of the premium less the subsidy determined in accordance with section 18; and

(f)                     the member has paid to a contractor (whether or not the member’s contract of insurance is still with that contractor), on demand of the contractor, the full amount of any subsidy paid to the contractor which the contractor has repaid, or is required to repay, to the Medicare Australia CEO under this Scheme for any premium period; and

(g)                    if the contract of insurance between the contracted insurer and the member requires the member to participate in a risk-management program, the member has agreed to undertake or has complied with that obligation in the premium period and completed the program as required, which may be in a subsequent premium period.

(2)        The date for paragraph (1) (c) is:

(a)                    2 months after the payment day; or

(b)                   such later date as is approved in writing by the Medicare Australia CEO where the Medicare Australia CEO is satisfied that the late payment was due to circumstances beyond the member's control, but, in respect of a premium period after the date of commencement of this Scheme, the later date must not be a date later than 12 months after the end of the relevant premium period.

Note   An example of circumstances beyond the member's control is where the member did not receive an invoice for the UMP support payment.

(3)        The Medicare Australia CEO may require the member to provide a statutory declaration setting out the reasons why the payment was not made by the date specified in paragraph (2) (a).

13A.           Members not invoiced for UMP support payment

(1)        This section applies to a member (the affected member) if:

(a)                    the member has a liability for UMP support payment; and

(b)                   the payment day for that liability is prescribed in a provision of regulations made under the Act where that provision comes into effect after 16 May 2006 (the new payment day).

(2)        Subsection 11 (4) and paragraph 13 (1) (c) are taken never to have applied to an affected member on or before the date of the new payment day.

(3)        Notwithstanding anything in this Scheme other than subsection (4), if for a premium period an affected member would have been entitled to a subsidy or a higher amount of subsidy had the affected member’s liability for the UMP support payment referred to in subsection (1) been taken into account in determining the member's gross indemnity costs, the contracted insurer may apply on behalf of the member for a subsidy or an adjustment to the member's subsidy, as the case may be.

(4)        Subsection 11 (4) and paragraphs 13 (1) (c) and (d) (and therefore subsection 13 (2)) apply to an affected member in respect of the new payment day:

(a)                    after the date referred to in subsection (2); and

(b)                   whether or not the new payment day is in the premium period referred to in subsection 11 (4) or section 13.

 

Part 4        Calculating the amount of subsidy

14.                  PSS calculation

For an eligible member referred to in paragraph 12 (1) (a), the PSS calculation is 80% of the amount by which the member’s gross indemnity costs exceed the base amount.

Base amount means:

(a)                    for a calculation of subsidy under Part 5, 7.5% of the eligible member’s estimated income; or

(b)                   for a calculation of subsidy under Part 6, 7.5% of the eligible member’s actual income.

15.                  Rural calculation

(1)        For a procedural general practitioner practising in a rural area, the rural calculation is 75% of the difference between:

(a)                    the amount of the premium for that practitioner; and

(b)                   the amount of the premium for a non-procedural general practitioner in the same income band and practising in the same State who has medical indemnity cover with the same contracted insurer.

(2)        If the procedural general practitioner's medical indemnity cover for procedural general practice is increased solely to cover the practitioner's performance of non-therapeutic cosmetic procedures, the increase in premium for the extended services is not to be included in the premium for subsection (1).

Note   Subsection (2) applies only to rural practitioners who come within the definition of procedural general practitioner, which excludes a practitioner whose procedural general practice involves only non-therapeutic cosmetic procedures. Under subsection (2) above, if a rural procedural general practitioner is required to pay a higher premium because he or she is performing non-therapeutic cosmetic procedures, the additional amount of premium is not included in the rural calculation.

16.                  [Not used]

17.                  MISS calculation

For a member with a MISS entitlement, the MISS calculation is determined using the MISS methodology set out in the Schedule.

18.                  Amount of subsidy

(1)        This section applies subject to section .

(2)        Subject to this Scheme, the amount of subsidy payable on behalf of an eligible member for a premium period is:

(a)                    for an eligible member referred to in paragraph 12 (1) (a), the amount calculated using the PSS calculation; or

(b)                   for a procedural general practitioner in a rural area, the amount calculated using the rural calculation; or

(c)                    for a member with a MISS entitlement, the amount calculated using the MISS calculation.

(3)        If during the whole or part of a premium period, a member, is an eligible member in more than one category mentioned in subsection (2), the amount of subsidy calculated for that member for the premium period or part of the period is the higher of the amounts calculated for each of the categories applying to the member at that time.

(4)        For the avoidance of doubt, an eligible member can be paid a subsidy only in respect of one category at any one time during the premium period.

(5)        A member who is paid a subsidy under this Scheme is not eligible to be paid a subsidy under the Premium Support Scheme 2004 in respect of the same premium period.

19.                  Calculation where change of circumstances in premium period

(1)        If the circumstances that formed the basis on which the subsidy payable to a member was calculated change during a premium period, the subsidy payable to the member must be recalculated having regard to those changed circumstances.

(2)        If a member is eligible during part of a premium period in one category (after taking account of subsection 18 (3)) and then changes to another category during another part of the premium period so that a different amount of subsidy applies (after taking account of subsection 18 (3)), the total subsidy payable to the member for the whole of the premium period is the sum of the amounts calculated for each part of the premium period.

20.                  Calculation where a member has received a subsidy under the MISS

If an eligible member has received a subsidy under the MISS which relates to a premium for medical indemnity cover for any period on or after 1 January 2004 (the first amount), the amount of subsidy calculated under subsection 18 (2) for the same period to which the first amount relates (the second amount) is, if the second amount is greater than the first amount, the difference between the first amount and the second amount.

21.                  Calculation for period 1 January to 30 June 2004

If the premium period for a contracted insurer is based on the financial year, the calculation of subsidy to be paid on behalf of an eligible member for the period 1 January to 30 June 2004 (inclusive) is to be calculated by halving the amount of estimated or actual income, as the case may be, and gross indemnity costs for the whole of the premium period in accordance with the PSS contract.

22.                  Calculation for members with a MISS entitlement where actual income not provided

If a member with a MISS entitlement does not provide to the contractor his or her estimated income or a statutory declaration as to his or her actual income for the premium period as required by the contractor, the amount of subsidy payable on behalf of that member for that premium period is calculated using the MISS calculation only, notwithstanding that the member may have been entitled to a higher amount of subsidy under one of the other calculations.

23.                  [Not used]

24.                  Gross indemnity costs

(1)        Gross indemnity costs means, for a premium period, costs charged to a member, or for which a member is liable, comprising any:

(a)                    premium; and

(b)                   UMP support payment (if any); and

(c)                    for a member other than a procedural general practitioner in a rural area, 50% of any risk surcharge charged to the member, where the risk surcharge used for this calculation is not to exceed the risk surcharge cap,

but do not include:

(d)                   GST; or

(e)                    stamp duty; or

(f)                     excess payments or deductibles; or

(g)                    charges imposed by the contractor on a member for late payment of any of these costs (including the premium); or

(h)                    costs for previous premium periods; or

(i)                      late payment penalties under the Act; or

(j)                     for the avoidance of doubt, any amount of premium for a policy that primarily covers the employees of a medical practitioner or an entity that runs a medical practice (being a company, partnership or other entity).

(2)        If the member’s gross indemnity costs change at any time during the premium period, an adjustment of the amount of subsidy, taking into account change in premium, must be made in accordance with this Scheme.

(3)        In this section:

risk surcharge means any surcharge or loading applied by a contractor to a member’s premium to reflect the prior claims history or other particular circumstances of that member;

risk surcharge cap means an amount that does not exceed the premium, excluding the risk surcharge.

25.                  Actual income

(1)        In this Scheme, actual income means the total of all billings generated by members from their practice for which they require medical indemnity cover for a premium period (in their name) or for which they are personally liable, including without limitation:

(a)                    medicare benefits; and

(b)                   payments by individuals, the Commonwealth Department of Veterans' Affairs, workers compensation schemes and third-party and/or vehicle insurers; and

(c)                    income earned for medical practice overseas if the member's contract of insurance covers any overseas practice (including, for the avoidance of doubt, income for practice referred to in subsection 12A(4)),

whether retained by the member or otherwise and before any apportionment or deduction of any expenses and/or tax. 

Note   Actual income may need to be provided for parts of a premium period – see section 19.

(2)        If as part of the member's medical practice the member derives income from any other sources (such as professional fees and incentive payments) this income must be included in the declaration of actual income

(3)        Where, for a premium period, the gross income of a member includes income from the provision of both private and public medical services, the actual income for the member is limited for the purpose of the calculation of gross indemnity costs and payment of subsidy to the income that relates to the provision of medical services for which medical indemnity cover is not provided by a public sector organisation, unless that organisation is the contracted insurer.

(4)        A member whose practice is primarily based on public billings, but who obtains medical indemnity cover for some private medical services which are not indemnified under a right to private practice agreement, is not eligible for a subsidy in respect of gross indemnity costs relating to those private medical services unless the member's actual income exceeds $1,000 for the whole of the premium period.

Note   Estimated income is calculated in the same manner as for actual income – see the definition in Part 10.

 

Part 5        Advance subsidy

26.                  Application for advance subsidy

(1)        A contractor may apply to the Medicare Australia CEO to be paid an advance subsidy on behalf of an eligible member for a premium period beginning on or after 1 January 2004.

(2)        An application for an advance subsidy to be paid on behalf of an eligible member for a premium period must be made no later than 2 months after the end of that premium period.  In this subsection, ‘premium period’ does not include part of a premium period.

Note   If a contractor does not make an application for an advance subsidy under this Part based on estimated income an application may be made under Part 6 when the member’s actual income is known, but an application under Part 6 cannot be made later than 12 months after the end of the premium period. 

(3)        If an application is made under section 32, an application cannot be made under this section in respect of the same member for the same period.

(4)        An application must be in a form, or in another manner, approved by the Medicare Australia CEO.

27.                  Payment of advance subsidy

(1)        Subject to this Scheme and the conditions in the PSS contract, the Medicare Australia CEO must pay to a contractor a subsidy under this Part on behalf of an eligible member for a premium period on or after 1 January 2004 if:

(a)                    the eligible member is eligible for a subsidy under Part 3; and

(b)                   the contractor has complied with the conditions specified in this Scheme, other than conditions in relation to actual income; and

(c)                    the contractor has calculated in accordance with this Scheme the amount of subsidy payable, but, for the PSS calculation, the calculation is based on estimated income (the amount of advance subsidy); and

(d)                   the contractor has applied to the Medicare Australia CEO for payment of the amount of advance subsidy in accordance with section 26 or 28; and

(e)                    the Medicare Australia CEO has no reason to believe at the time of receiving the application for advance subsidy that the information provided is false or inaccurate.

(2)        A calculation by a contractor that a member is not eligible for an advance subsidy is deemed for the purpose of subsection 47 (1) to be a decision of the Medicare Australia CEO that the member is not an eligible member.

(3)        The Medicare Australia CEO must make a payment of advance subsidy under this section in accordance with the manner and within the timeframe set out in the PSS contract, or otherwise as soon as practicable after receiving the application.

28.                  Adjustments of advance subsidy

(1)        Where a contractor has received an advance subsidy on behalf of a member for a premium period and:

(a)                    there has been a change in the member’s circumstances during any part of that premium period; or

(b)                   the information on which the amount of advance subsidy was calculated was not correct or has changed,

the contractor must recalculate the amount of advance subsidy based on the new information and apply to the Medicare Australia CEO for an adjustment in accordance with the conditions and requirements of the PSS contract.

(2)        An application for an adjustment under this section must be in a form, or in another manner, approved by the Medicare Australia CEO.

(3)        If the amount calculated in accordance with this section is less than the amount of advance subsidy to which the adjustment relates, the difference is a debt due to the Commonwealth from the contractor.

(4)        If the amount calculated in accordance with this section is more than the amount of advance subsidy to which the adjustment relates, the Medicare Australia CEO must pay the difference to the contractor as an advance subsidy, but the Medicare Australia CEO may offset that amount against other amounts due from the contractor to the Medicare Australia CEO under this Scheme.

(5)        Notwithstanding anything in the PSS contract, applications for adjustment must be made as soon as practicable or otherwise within the timeframe notified in writing by the Medicare Australia CEO to the contracted insurer.

29.                  Reconciling amounts paid

(1)        Subject to subsection (2), where a contractor has received an advance subsidy on behalf of a member, the member must provide, by way of a statutory declaration, to the contractor within 12 months of the end of a premium period to which the subsidy relates, the information as required by the contractor on the member’s actual income for the premium period, or, if the member has changed categories during the premium period, for each of the parts of the premium period to which the subsidy relates.

(2)        If a member with a MISS entitlement does not provide the statutory declaration referred to in subsection (1), section 22 applies to that member in calculating the determination of final subsidy.

(3)        A contractor which has been paid an advance subsidy on behalf of a member for a premium period must make an application under section 31 (whether or not the contractor believes a subsidy is payable under that Part):

(a)                    as soon as practicable after receiving the member’s statutory declaration referred to in subsection (1); or

(b)                   for members with a MISS entitlement who express their intention not to provide a statutory declaration, as soon as practicable after becoming aware of that information; or

(c)                    for members with a MISS entitlement who have not expressed their intention not to provide a statutory declaration and have not done so within the 12-month timeframe for providing the statutory declaration, as soon as practicable after the 12-month timeframe; or

(d)                   otherwise in accordance with the timeframes specified in the PSS contract.

30.                  Failure to make application or provide information

If a contractor which has been paid an advance subsidy on behalf of a member for a premium period does not make an application under section 31 or cannot do so because the member (other than a member with a MISS entitlement) has not provided the statutory declaration referred to in subsection 29 (1):

(a)                    the amount of advance subsidy paid under this Part for that member for that period is taken to have been incorrectly paid; and

(b)                   the amount incorrectly paid is a debt due from the contractor to the Commonwealth; and

(c)                    the member must pay the full amount of the premium for that premium period to the contractor.

Note   If a PSS contract is no longer in force, the former contractor must still comply with this requirement – see section 39.

Part 6        Final determination of subsidy

31.                  Application where advance subsidy paid

Where:

(a)                    a contractor has received payment of an advance subsidy under Part 5; and

(b)                   if subsection 29 (1) requires the member to whom the subsidy relates to give a statutory declaration to the contractor and the member has done so;

the contractor must apply to the Medicare Australia CEO under this Part for a final determination of the subsidy.

Note   If an application is not made or cannot be made because the member has not provided the statutory declaration, the amount of advance subsidy must be repaid – see section 30.

32.                  Application where advance subsidy not paid

(1)        A contractor who has not made an application under Part 5 for payment of an advance subsidy on behalf of an eligible member may apply to the Medicare Australia CEO for payment of a subsidy under this Part on behalf of the eligible member for a premium period beginning on or after 1 January 2004.

(2)        Subject to subsection 32 (4), an application cannot be made under this section unless the member has provided, by way of a statutory declaration, to the contractor within 12 months of the end of the premium period to which the subsidy relates, the information as required by the contractor on the member’s actual income for the premium period, or, if the member has changed categories during the premium period, for each of the parts of the premium period to which the subsidy relates.

(3)        The application must be made within the same timeframes as mentioned in subsection 29 (3).

(4)        If a member with a MISS entitlement does not provide the statutory declaration referred to in subsection (2), section 22 applies to that member in calculating the determination of final subsidy.

33.                  Form of application

(1)        An application under this Part must be in a form, or in another manner, approved by the Medicare Australia CEO.

(2)        The application must be accompanied by:

(a)                    a statement of the amount of subsidy, calculated by the contractor in accordance with this Scheme, to which the member was or is entitled; and

(b)                   any other document or information required by the PSS contract.

34.                  Determination where advance subsidy paid

(1)        As soon as practicable after receiving an application under section 31, the Medicare Australia CEO must determine, in accordance with this Scheme and taking account of the information received in the application and any other relevant information:

(a)                    whether the contractor was entitled to receive on behalf of the member the amount of advance subsidy paid under this Scheme; and

(b)                   if so, the amount of subsidy that the contractor was entitled to receive on behalf of that member.

(2)        If the Medicare Australia CEO determines that the amount of subsidy the contractor was entitled to receive is greater than the amount of advance subsidy paid under Part 5, the Medicare Australia CEO must pay to the contractor as a subsidy under this Scheme the difference between the amount paid under Part 5 and the amount of subsidy determined by the Medicare Australia CEO under this Part.

35.                  Repayment of advance subsidy

If the Medicare Australia CEO determines under section 34 that the amount of subsidy the contractor was entitled to receive on behalf of the member is less than the amount of advance subsidy paid under Part 5, or the Medicare Australia CEO determines that no subsidy is payable, for the premium period to which the advance subsidy relates:

(a)                    the contractor must pay to the Medicare Australia CEO an amount equivalent to the difference between the advance subsidy paid and the amount determined by the Medicare Australia CEO under this Part, or the whole amount of the subsidy, as the case may be; and

(b)                   that amount is a debt due to the Commonwealth from the contractor.

36.                  Determination where no advance subsidy paid

(1)        Subject to this Scheme, if an application is made under section 32, the Medicare Australia CEO must determine the amount of subsidy payable to the contractor on behalf of the eligible member for the premium period, but only if:

(a)                    the eligible member is eligible for a subsidy under Part 3; and

(b)                   the contractor has complied with the conditions specified in this Scheme; and

(c)                    the contractor has calculated in accordance with this Scheme the amount of subsidy payable; and

(d)                   the Medicare Australia CEO has no reason to believe at the time of receiving the application that the information provided is false or inaccurate.

(2)        A calculation by a contractor that a member is not eligible for a subsidy under this section is deemed for the purpose of subsection 47 (1) to be a decision of the Medicare Australia CEO that the member is not an eligible member.

37.                  Time for making payments of subsidy

The Medicare Australia CEO must make a payment of a subsidy under this section in accordance with the manner and within the timeframe set out in the PSS contract, or otherwise as soon as practicable after the determination has been made.

38.                  Incorrect payments

If, after making a determination under section 34 or subsection 36 (1), the contractor informs the Medicare Australia CEO or the Medicare Australia CEO otherwise becomes aware that:

(a)                    the medical practitioner was not eligible or has ceased to be eligible for a subsidy, or part thereof, on his or her behalf; or

(b)                   the subsidy, or part thereof, was otherwise incorrectly paid,

that amount of subsidy paid, either as an advance subsidy under Part 5 or final subsidy under this Part, is a debt due from the contractor to the Commonwealth.

39.                  Former contractors

If a PSS contract is terminated or expires, this Scheme, other than section 26 and section 32, applies to the parties to that PSS contract for the purposes of adjusting or reconciling amounts paid on behalf of an eligible member as if:

(a)                    references to a ‘contractor’ were references to a ‘former contractor’; and

(b)                   the member on whose behalf the subsidy is to be paid or repaid, or in respect of whom an application must be made under sections 31 or 32, continued to have a contract of insurance providing medical indemnity cover with the contracted insurer in the same terms as when the PSS contract was in force.

 

Part 7        Conditions for the contractor

40.                  Conditions to be satisfied

For a subsidy to be payable to a contractor on behalf of an eligible member for a premium period, the contractor must comply with the following conditions:

(a)                    before each premium period, the contractor must inform a member who gives his or her consent to the contractor to participate in this Scheme:

(i)                      whether the member is an eligible member at that time; and

(ii)                     the amount of the premium;

(iii)                   the amount of the premium that the member must pay directly to the contractor; and

(iv)                   the amount, including a zero amount, the contractor has calculated as the amount of subsidy or advance subsidy payable by the Medicare Australia CEO, subject to this Scheme, in respect of that member and the method by which that amount was calculated; and

(v)                    any other information required by the PSS contract; and

(b)                   the contractor must keep records relevant to the premium payable by a medical practitioner and the calculation of subsidy paid on behalf of an eligible member for five years from the day on which the records were created; and

(c)                    the contractor must comply with all applicable Laws in respect of contracts of insurance; and

(d)                   the contractor must comply with the conditions set out in the PSS contract for the payment of subsidy on behalf of members under this Scheme.

Part 8        Administration fee

41.                  Eligibility

A contractor is eligible to be paid a subsidy under this Scheme calculated in accordance with section 43 (the administration fee) to help the contractor meet the cost of administering this Scheme for a premium period, if the PSS contract provides for the payment of an administration fee and the contractor:

(a)                    applies to be paid an administration fee under section 42; and

(b)                   complies with the conditions for payment of an administration fee in this Scheme and the PSS contract.

42.                  Application

An application for an administration fee must:

(a)                    be in a form, or in another manner, and within a timeframe, approved by the Secretary; and

(b)                   specify an amount that the contractor estimates as the administration fee, having regard to the matters set out in paragraphs 43 (1) (a) to (c).

43.                  Calculation

(1)        The administration fee payable to a contractor to help the contractor meet the cost of administering this Scheme is such amount as is determined by an authorised officer to be reasonable, having regard to:

(a)                    the actual cost to the contractor of meeting the obligations imposed on it by this Scheme; and

(b)                   the need for the efficient and effective performance of those obligations in the interests of the parties to the PSS contract and affected medical practitioners; and

(c)                    the amount set out in the PSS contract as the estimated administration fee components; and

(d)                   the estimated amount provided in the contractor’s application.

 

(2)        The authorised officer may consult with the Medicare Australia CEO and any other relevant person or agency when calculating an amount under subsection (1).

(3)        An administration fee payable in accordance with this Part constitutes a payment in respect of all costs, including any expenses, disbursements, levies and taxes (including GST), incurred by the contractor in carrying out its obligations under this Scheme for the premium period to which the payment relates.

44.                  Determination

If the contractor:

(a)                    has made an application under section 42; and

(b)                   an authorised officer is satisfied that the contractor is eligible for an administration fee determined in accordance with this Part,

the authorised officer must notify the Medicare Australia CEO as soon as practicable of the amount of the administration fee determined under this Part.

45.                  Payment

The Medicare Australia CEO must pay to the contractor, in accordance with the requirements of the PSS contract, the amount of the administration fee notified to it by an authorised officer within the timeframe set out in the PSS contract.

46.                  Non-compliance with conditions

If an authorised officer becomes aware, after an administration fee has been paid to a contractor, that the contractor has not complied with the conditions for the payment of the administration fee for the period to which the administration fee relates:

(a)                    an authorised officer may determine that the fee was incorrectly paid; and

(b)                   if so, the amount of the fee paid is a debt due to the Commonwealth from the contractor.

Part 9        Miscellaneous

47.                  Review of decisions

(1)        In this section, reviewable decision means:

(a)                    a determination of the Medicare Australia CEO under section 34; or

(b)                   a deemed decision under subsection 27 (2) or 36 (2); or

(c)                    a determination of an authorised officer under Part 8; or

(d)                   a decision of the Medicare Australia CEO under paragraph 13 (2) (b) not to approve a later date. 

(2)        A medical practitioner (the applicant) affected by a reviewable decision referred to in paragraphs (1) (a), (b) or (d) may seek review of the decision (the original decision) by an employee authorised by the Medicare Australia CEO (the reviewing officer).

(3)        A contractor (the applicant) affected by a reviewable decision referred to in paragraphs (1) (a) or (c) may seek review of the decision (the original decision):

(a)                    for a decision referred to in paragraph (1) (a), by an employee authorised by the Medicare Australia CEO (the reviewing officer); or

(b)                   for a decision referred to in paragraphs (1) (a) or (c), by an authorised officer (the reviewing officer).

(4)        An employee of Medicare Australia or an officer of the Department must not be authorised as a reviewing officer unless the employee or the officer has a classification higher than the classification of the official who made the original decision.

(5)        The reviewing officer must:

(a)                    confirm the original decision; or

(b)                   substitute the original decision with another decision.

(6)        The reviewing officer must give to the applicant:

(a)                    a notice in writing stating the outcome of the review; and

(b)                   the reasons for the decision.

(7)        The applicant may apply to the Administrative Appeals Tribunal for review of the reviewing officer’s decision.

Note   Under section 27A of the Administrative Appeals Tribunal Act 1975, the decision-maker must give to any person whose interests are affected by the decision notice, in writing or otherwise, of the making of the decision and of the person’s right to have the decision reviewed.

(8)        Where a medical practitioner applies for review of a reviewable decision under subsections (2) or (7), the amount of the premium is not reviewable.

48.                  Information obtained by the Medicare Australia CEO

In assessing whether:

(a)                    a member is an eligible member and, if so, the amount of subsidy or advance subsidy payable in respect of that member; or

(b)                   a contractor is eligible for an administration fee and the amount of that fee,

the Medicare Australia CEO or the authorised officer, as the case may be, may have regard to:

(c)                    any relevant information obtained under section 44 of the Act; and

(d)                   any relevant information obtained by the Medicare Australia CEO or the Department; and

(e)                    any information in the possession of the Department or the Medicare Australia CEO, including information linked to the medical practitioner’s provider number; and

(f)                     any other relevant information.

49.                  Disclosure of information

(1)        For the purpose of administering, assessing and reviewing the operation of this Scheme or the PSS contract, the Medicare Australia CEO, the Department and contractors may exchange information and data which they have respectively obtained under this Scheme, other relevant legislation, the PSS contract or the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003.

(2)        For the purposes of administration of this Scheme, a contractor must provide to the Medicare Australia CEO or the Department such information, including personal information, as is required or requested by the Medicare Australia CEO or the Department.

50.                  Offsetting debts

Any debt due from the contractor to the Commonwealth under this Scheme:

(a)                    is recoverable by the Medicare Australia CEO on behalf of the Commonwealth; and

(b)                   may be offset by the Medicare Australia CEO against any other amount payable to the contractor under this Scheme.

51.                  Repayment of subsidy by a medical practitioner

If a contractor is required under this Scheme to repay to the Medicare Australia CEO a subsidy paid on behalf of a medical practitioner, the medical practitioner to whom the subsidy relates must pay to the contractor the amount of the repayment, being the premium, or part of the premium, due from the medical practitioner to the medical indemnity provider.

Note   The medical practitioner will not be eligible for any subsidy while the amount is outstanding – see subsection 11 (1).

Part 10      General list of definitions

52.                  Definitions

Note   Some terms used in this Scheme are defined in the Act, including:

contribution year
Medicare Australia CEO
 medical indemnity cover
 medicare benefit
Secretary.

(1)        In this Scheme, unless the contrary intention appears:

Act means the Medical Indemnity Act 2002 as amended from time to time.

actual income means the amount calculated under section 25.

Australia includes an external Territory.

authorised officer means an officer of the Department authorised by the Secretary to perform a function under this Scheme.

contracted insurer means a medical indemnity provider which is a party to a PSS contract that is in force.

contractor means a contracted insurer. 

deferred payment day has the same meaning as under section 62 of the Act.

Department means the Department of Health and Ageing.

eligible member has the meaning given by section 12.

estimated income means a reasonable estimate by the medical practitioner of his or her income for the premium period, calculated in the same manner as for actual income under section 25.

general practitioner has the same meaning as under subsection 3(1) of the Health Insurance Act 1973.

gross indemnity costs means an amount calculated in accordance with section 24.

GST has the same meaning as in the A New Tax System (Goods and Services Tax) Act 1999.

Law means any applicable Commonwealth, State or Territory statute, regulation, or subordinate legislation in force from time to time.

medical indemnity provider means the Victorian Medical Insurance Authority established by the Victorian Medical Insurance Authority Act 1996 (Vic).

medical practitioner means a medical practitioner, as defined in subsection 4 (1) of the Act, who:

(a)          is a rural general practitioner for the purposes of the Victorian Department of Human Services Rural General Practitioner Program (referred to in the Victorian Government Gazette of 10 March 2005) as in existence at the commencement of this Scheme; and

(b)          has a contract of insurance with the Victorian Medical Insurance Authority established by the Victorian Medical Insurance Authority Act 1996 (Vic).

member means a medical practitioner, as defined in this Part, who has a contract of insurance providing medical indemnity cover with a contracted insurer or, where the context permits, a former contracted insurer.

member with a MISS entitlement has the meaning given by subsection 12.

MISS means the Medical Indemnity Subsidy Scheme 2003 formulated under subsection 43(1) of the Medical Indemnity Act 2002, as in force at 30 June 2004.

MISS calculation means the amount calculated under the Schedule.

non-therapeutic cosmetic procedure means a procedure that is cosmetic in nature and is not a professional service mentioned in the general medical services table under the Health Insurance Act 1973.

payment day has the same meaning as under section 61 of the Act.

personal information has the same meaning as in the Privacy Act 1988.

premium, for a medical indemnity cover policy, means the amount assessed by the contracted insurer which indemnifies the medical practitioner against claims arising from the practitioner's medical practice, including legal action by third parties.

premium period means the period for which the contractor collects the premium, as specified in the PSS contract.

procedural general practitioner means a general practitioner, who is liable to pay a premium for medical indemnity cover for procedural general practice, including a vocationally or non-vocationally registered general practitioner, overseas-trained doctor or other medical practitioner (including a medical practitioner undertaking a placement as a procedural general practitioner registrar in the course of a training program conducted by or on behalf of General Practice and Educational Training Limited) whose practice includes the non-referred provision of one or more of the following professional services mentioned in the general medical services table, as amended from time to time, under the Health Insurance Act 1973:

(a)                    administration of anaesthetic;

(b)                   surgical procedures for which hospital facilities are or would normally be required;

(c)                    obstetric procedures;

(d)                   accident and emergency medicine;

(e)                    invasive medical procedures, except the administration of Implanon,

but does not include a medical practitioner who is charged a premium higher than the premium charged to non-procedural general practitioners solely because of the performance of non-therapeutic cosmetic procedures.

PSS calculation means the amount calculated under section 14.

PSS contract means a contract authorised by section 7.

public sector organisation means an entity whose primary function is to provide health services to the public at no charge.  Public sector organisation may include, without limitation, a State or Territory government department, a public hospital, an area health service or a public health clinic where the entity's primary purpose is to provide health services to the public at no charge.

rural area means a rural or remote area in levels 3 to 7 of the Rural, Remote and Metropolitan Areas Classification.

rural calculation means the amount calculated under section 15.

Rural, Remote and Metropolitan Areas Classification means the document so titled, as in force on 1 January 2001, setting out certain categories of areas in Australia that have been determined by the Department by reference to population size and remoteness of locality on the basis of 1991 census data published by the Australian Bureau of Statistics in 1994.

subsidy means a subsidy payable under this Scheme.

State includes Territory.

UMP support payment means a payment required to be made under the Medical Indemnity Act 2002 and the Medical Indemnity (UMP Support Payment) Act 2002.

vocationally registered general practitioner has the meaning given under section 3F of the Health Insurance Act 1973.

 

Schedule

1.                      MISS methodology

The methodology for the purpose of section 17 is as set out in this Schedule.

2.                      Interpretation

In this Schedule, unless the contrary intention appears:

corresponding medical practitioner, in relation to a neurosurgeon, procedural general practitioner or specialist obstetrician, means a general surgeon, non procedural general practitioner or gynaecologist, respectively:

(a)                    who has the same insurer, or is a member of the same MDO, as the neurosurgeon, procedural general practitioner or specialist obstetrician; and

(b)                   whose medical practice is within the same geographical area (that is, the State, Territory or other area recognised by the insurer or MDO for the purpose of determining premiums) as the neurosurgeon, procedural general practitioner or specialist obstetrician; and

(c)                    who is classified by that insurer or MDO within the equivalent income band (or demonstrates other parallel characteristics) as the neurosurgeon, procedural general practitioner or specialist obstetrician.

neurosurgeon means:

(a)                    a medical practitioner who:

(i)                      is a fellow of the Royal Australasian College of Surgeons; and

(ii)                     is identified by the College as belonging to the surgical specialty area of neurosurgery; or

(b)                   a medical practitioner who is a member of the Neurosurgical Society of Australasia.

premium means the premium payable for relevant indemnity insurance, but excludes any component of the amount payable that is attributable to GST, stamp duty or any additional charge that relates to the practitioner’s prior claims history.  The premium must be determined in accordance with Part 7 of this Scheme.

relevant indemnity means an indemnity from claims arising in relation to the practitioner’s practice of his or her medical profession:

(a)                    that covers the provision of medicare-billable services in the practitioner’s principal field of practice; and

(b)                   that does not include run-off cover or retroactive cover; and

(c)                    the premium, for which, because of the practitioner’s practice as a neurosurgeon, specialist obstetrician or procedural general practitioner, is greater than the premium that a corresponding medical practitioner would have to pay for an equivalent indemnity.

If an indemnity that includes run-off cover or retroactive cover would otherwise be a relevant indemnity under this definition, the component of the relevant indemnity that is not run-off cover or retroactive cover is a relevant indemnity.

specialist obstetrician means a medical practitioner who is recognised by the Royal Australian and New Zealand College of Obstetricians and Gynaecologists as a specialist obstetrician.

3.                      Neurosurgeons

The MISS calculation for a neurosurgeon in respect of a premium payable by the neurosurgeon is:

(a)                    if the total amount of the premium for the premium year is $50,000 or less and the amount that a corresponding medical practitioner would have had to pay to meet the costs to which the premium relates (the corresponding amount) is less than $50,000 — 50% of the difference between the amount of the premium and the corresponding amount; or

(b)                   if the total amount of the premium for the premium year is more than $50,000, and the corresponding amount is less than $50,000 — the sum of the following amounts:

(i)                      80% of the amount by which the total premium exceeds $50,000;

(ii)                     50% of the difference between $50,000 and the corresponding amount; or

(c)                    if the total amount of the premium for the premium year is more than $50,000 and the corresponding amount is $50,000 or more — 80% of the difference between the total amount of the premium and the corresponding amount.

4.                      Specialist obstetricians

The MISS calculation for a specialist obstetrician in respect of a premium payable by the obstetrician  is:

(a)                    for a specialist obstetrician who provides services in a rural or remote area within the meaning of the Rural, Remote and Metropolitan Areas (RRMA) Classification — 80% of the difference between the amount of the premium and the amount that a corresponding medical practitioner would have had to pay to meet the costs to which the premium relates; and

(b)                   for any other specialist obstetrician — 50% of the difference between the amount of the premium and the amount that a corresponding medical practitioner would have had to pay to meet the costs to which the premium relates.

5.                      Procedural general practitioners – non-rural

The MISS calculation for a procedural general practitioner not practising in a rural area in respect of the premium payable by the procedural general practitioner is 50% of the difference between the amount of the premium and the amount that a corresponding medical practitioner would have had to pay to meet the costs to which the premium relates.

6.                      Procedural general practitioners – rural

The MISS calculation for a procedural general practitioner practising in a rural area in respect of the premium payable by the procedural general practitioner is 75% of the difference between the amount of the premium and the amount that a corresponding medical practitioner would have had to pay to meet the costs to which the premium relates.  This is a new provision that was not in the MISS, to cover procedural general practitioners practising in a rural area with a MISS entitlement.

7.                      Procedural general practitioner registrars

The MISS calculation for a procedural general practitioner registrar in respect of the premium payable by the registrar is 80% of the difference between the amount of the premium and the amount that a corresponding medical practitioner would have had to pay to meet the costs to which the premium relates.

In this item, procedural general practitioner registrar means a procedural general practitioner undertaking a placement as a procedural general practitioner registrar in the course of a training program conducted by or on behalf of General Practice and Educational Training Limited.