Medical Indemnity (IBNR Claims) Protocol 2006
Medical Indemnity Act 2002                                                
I, TONY ABBOTT, Minister for Health and Ageing, determine this Protocol under section 27A of the Medical Indemnity Act 2002.
Dated                            23/11/2006
 
Tony Abbott
Minister for Health and Ageing                                                                                          
Part 1                     Preliminary
1              Name of Protocol
This Protocol is the Medical Indemnity (IBNR Claims) Protocol 2006.
2              Commencement
                (1)  This Protocol commences on the day after it is registered.
                (2)  This Protocol may apply to costs incurred by a MDO prior to the date the Protocol commences.
3              Definitions
(1)  In this Protocol:
                  Act means the Medical Indemnity Act 2002.
                IBNR Claim means a claim made to a MDO in relation to an incident covered by section 14 of the Medical Indemnity Act 2002.
                IBNR Indemnity means the amount of IBNR indemnity calculated in accordance with subdivision D of Part 2, Division 1 of the Medical Indemnity Act 2002.
(2)  A reference to costs incurred or a MDO having incurred costs refers to costs that the MDO has paid or has a legal liability to pay.
(3)  A reference to legal, administrative or other costs does not include legal costs, administrative costs or other costs incurred by a MDO in complying with a request by the Medicare Australia CEO under sections 27B, 38 or 71 of the Act.
Note:  The words and expressions used in this Protocol have the meaning given in the Act.  For example:
claim
Medicare Australia CEO
MDO
 
Part 2            Payment of claim handling fees in respect of IBNR claims (under paragraph 27A(1)(a) of the Act)
4              Claim handling fees
Where a MDO is managing an IBNR claim, it may apply to the Medicare Australia CEO for a claim handling fee in respect of that claim.
5              When a claim handling fee is payable
(1)  A claim handling fee is payable to a MDO in respect of an IBNR claim if:
(a)            the MDO has handled or is handling an IBNR claim; and
(b)            the MDO has incurred costs in respect of that IBNR claim; and
(c)            an IBNR indemnity is payable by the Medicare Australia CEO in respect of those costs; and
(d)            the MDO has not already been paid a claim handling fee by the Medicare Australia CEO in respect of those costs; and
(e)            the MDO applies to the Medicare Australia CEO for payment of the claim handling fee in accordance with section 7 of this Protocol.
(2)  More than one claim handling fee may be payable, under this section, to a MDO in respect of an IBNR claim.
 
6              Amount of claim handling fee payable
(1)  A claim handling fee that is payable under section 5 is calculated in accordance with this section.
(2)  Where the costs incurred by the MDO are IBNR indemnity costs, including legal, administrative or other costs incurred in respect of those indemnity costs, the amount payable to the MDO by the Medicare Australia CEO is calculated using the following formula:

  5
   x
  IBNRI
=
CHFP

100

Where:
IBNRI is the amount of the IBNR indemnity payable by the Medicare Australia CEO under subdivision D of Part 2, Division 1 of the Act in response to an application for payment from a MDO. 
Note:  Subsection 4(3) of the Act sets out the scope of a payment made 'in relation to a claim against a person' and also a payment 'made in relation to a claim by a person'.  The IBNR indemnity may include legal, administrative or other costs directly attributable to any negotiations, arbitration or proceedings in relation to the claim by or against the person.
CHFP is the claims handling fee payable by the Medicare Australia CEO to the MDO.
(3)  Where the costs incurred by the MDO in relation to the claim are both IBNR indemnity costs and high cost claim indemnity costs the amount payable to the MDO by the Medicare Australia CEO is calculated using the following formula:

5
x
(  IBNRI + HCCI  )
=
CHFP

100

Where:
IBNRI is the amount of the IBNR indemnity payable by the Medicare Australia CEO under subdivision D of Part 2, Division 1 of the Act in response to an application for payment from a MDO. 
Note:  Subsection 4(3) of the Act sets out the scope of a payment made 'in relation to a claim against a person' and also a payment 'made in relation to a claim by a person'.
HCCI is the amount of high cost claim indemnity by which the IBNR indemnity has been reduced in accordance with subsection 21(3) of the Act.
CHFP is the claim handling fee payable by the Medicare Australia CEO to the MDO.
 
Part 3              General
7              Application for payment
An application by a MDO for a payment under this Protocol 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.
8              Payment date
(1)  Subject to subsection (2), the Medicare Australia CEO must pay a payment under this Protocol before the end of the month immediately following the month in which the MDO applied to the Medicare Australia CEO for the payment. 
(2)  If a MDO applies for a payment under this Protocol; and
(a)            the MDO has not complied with the requirements of the application form; or
(b)            the Medicare Australia CEO has requested further information under section 27B of the Act in relation to the application and the MDO has not given the Medicare Australia CEO the information that was requested under section 27B in relation to the application for payment;
the payment date for the payment must be before the end of the month immediately following the month in which the MDO complies with the requirements of the application form or provides the information requested by the Medicare Australia CEO under section 27B, as the case may be.
9              Recovery of overpayments
(1)  This section applies if an amount is paid by way of a payment under this Protocol to a MDO and:
(a)      the amount of the payment under this Protocol is not payable; or
(b)      the amount paid is greater than the amount of the payment under this Protocol 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 MDO.
(4)  The amount overpaid may be recovered:
(a)      by action by the Medicare Australia CEO against the MDO in a court of competent jurisdiction; or
(b)      by deduction from any future amount payable to the MDO under this Protocol.