EXPLANATORY STATEMENT
Issued by Authority of the Minister for Health and Ageing
Midwife Professional Indemnity (Commonwealth Contribution) Scheme Act 2010
Midwife Professional Indemnity (Commonwealth Contribution) Scheme
Rules 2010 (No. 2)
Section 90 of the Midwife Professional Indemnity (Commonwealth Contribution) Scheme Act 2010 (the Act) provides that the Minister may, by legislative instrument, make rules providing for matters required or permitted by the Act to be provided for in the Rules or necessary or convenient to be provided for in order to carry out or give effect to the Act.
Background
The Act and the Midwife Professional Indemnity (Run-off Cover Support Payment) Act 2010 give effect to the Government’s professional indemnity scheme for eligible midwives which provides for Commonwealth support for professional indemnity insurance for a certain class of midwives who have been unable to access insurance since 2002 and opens the way forward for improving access to maternity services.
Under Part 2 of Chapter 2 of the Act, a contribution will be paid by the Commonwealth to an insurer if certain criteria, set out in, or under, the Act, are met. One of the criteria that must be met for a Level 1 or Level 2 Commonwealth contribution to be paid is that the Medicare Australia CEO must certify that the claim is a qualifying claim under section 11 of the Act. A claim must satisfy the common requirements in subsection 11(3) for a Level 1 or Level 2 qualifying claim certificate to be issued by the Medicare Australia CEO.
Part 3 of Chapter 2 of the Act deals with run-off cover Commonwealth contributions. Section 31 sets out the eligibility requirements for an eligible run-off claim.
These Rules are required to ensure that certain self-employed midwives are included in the definition of 'eligible midwives' for the purposes of meeting the common requirements for a qualifying claim set out in Section 11(3) of the Act. Section
11(3) (g) of the Act provides that a Commonwealth Contribution cannot be paid in relation to claims made against midwives who are employees where the claim relates to an incident occurring in the course of, or in connection with, their employment (employed midwives are generally covered by the vicarious liability insurance arrangements of their employers).
These Rules allow for midwives who are employed via a company that they own, either solely or jointly with other midwives, to access the Commonwealth schemes. If these Rules did not have effect, self employed midwives may have claims against them, which are otherwise eligible claims, refused. This would mean that any resulting liability would fall to the midwife, instead of the insurer and the Commonwealth. This outcome was not intended when the Act was originally drafted.
The Rules commenced on 1 July 2010.
The Rules are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Details of the Rules are set out in the Attachment.
Consultation
The government has consulted with Medicare Australia, the Chief Nurse and Midwifery Officer, the Medical Insurance Group Australia and representatives of midwives’ organisations.
ATTACHMENT
DETAILS OF THE MIDWIFE PROFESSIONAL INDEMNITY (COMMONWEALTH CONTRIBUTION) SCHEME RULES 2010 (No. 2)
1. Name of Rules
Rule 1 sets out the name of the Rules.
2. Commencement
Rule 2 sets out that the Rules commence on 1 July 2010.
3. Interpretation
Rule 3 sets out the definitions used in the Rules.
4. Claims by eligible midwives
Rule 4 clarifies that claims made in relation to eligible midwives who practise effectively as self employed midwives through a company, are not excluded from eligibility from either the Level 1 and Level 2 contribution or the run-off cover contribution because of that practise. The rule relates only to companies where all owners and directors are practising midwives.