Health care and income protection for all

Health care and income protection for all

The collapse is just one indication of a broader insurance crisis faced
by the medical industry, most noticeable in climbing premiums for doctors.

In 2001 a doctor not carrying out seriously risky procedures was required
to pay around $1000 a year to an insurance company in order to be covered
if sued by a patient for negligence. Costs for doctors involved in delivering
babies or major surgery paid more than $10,000.

Since then, however, these costs have increased dramatically: the base
rate is $2500, and delivering babies would cost a doctor at least $100,000
in insurance.

While some specific factors — including the NSW government decision
to cap pay-outs, which resulted in victims rushing into court before the
new laws would take effect — helped the demise of UMP, the pressure on
the industry is substantially caused by a decade-long rise in insurance
pay-outs.

Most of the large pay-outs have been for children suffering injury at
birth or problems associated with neurosurgery, which is the most difficult
of surgical areas.

The government’s approach of capping pay-outs is disgraceful. Without
these large sums of money, many victims of medical procedures gone wrong
would not be able to pay their life-long medical bills.

But the current system is creating a farcical situation. In Florida
there are no longer any obstetricians willing to be involved in the birth
of children — forcing women with complicated pregnancies interstate. Obstetricians
in the NSW South Coast last year refused to deliver babies in public hospitals
until the state government agreed to help them pay their premiums.

Independent midwives are facing a tripling of indemnity insurance, and
some states are facing a possible end to home-birthing services altogether.

These problems are caused by the current litigation-focused system,
where patients can only get compensation, and thus money to pay medical
bills and to live on if they cannot work, by suing the medical practitioner.
To cover themselves against enormous pay-outs, health professionals must
pay large sums to insurance agencies.

Most of the time, lawyers and insurance companies benefit out of the
system, but both patients and doctors lose.

Patients are reliant upon “blaming” someone for their injury in order
to get income protection. If the medical practitioner wasn’t at fault —
they get nothing. There is a built in disincentive to appear healthy, as
this may be used as evidence by the insurance company to cut of financial
support.

Doctors practice defensively, and have an interest in covering up or
seeking to minimise errors, to avoid litigation.

Patients and medical practitioners would be better off under a “no-fault”
system, that did not link medical practitioner error to compensation pay-outs.
Necessary treatment and income support for all injured patients should
be guaranteed by the government, free education should be continuously
offered to health professionals and health provision should be monitored
and improved on a system-wide basis, with discipline of doctors used when
necessary.

In New Zealand, midwives are state-employed on a no-fault system. A
US private hospital adopting a no-fault approach — when a patient is hurt
during a procedure, treatment is completed free — showed improved patient
care and lower costs.

While in Australia, public-hospital doctors are insured by the government,
the public health system is being eroded while the government, in effect,
subsidises the private health insurance industry. This will get worse if
the government does privatise the government-owned health insurance company,
Medibank Private.

If the government stopped such subsidies, the savings could be used
to expand public health services, creating salaried positions for health
workers based in hospitals and in the community, as well as ensuring income
protection for anyone unable to work due to health-care-related injury.

From Green Left Weekly, May 8, 2002.

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From GLW issue 491