Australia has known for over a quarter of a century that its compensation system for injured patients does not deliver and is unjust. The only way an injured patient can claim for losses due to a medical treatment injury is by proving negligence or fault through civil litigation, which can take years. Please keep sharing this petition.
In 1995 the Hawke Labor Government’s Professional Indemnity Review (PIR)[1] reported that of around 230,000 "preventable" healthcare injuries each year, fewer than 2,000 resulted in negligence claims, and the vast majority were won by health professionals. This suggests that fewer than 1% of healthcare injuries were compensated. Yet, over the following decade, far from facilitating such compensation, Australia moved decisively to make compensation even harder to obtain.
At the turn of the millennium, a national “insurance crisis” snowballed amidst intense media coverage. Australia's second largest insurance company, HIH, collapsed in 2001, followed by the largest medical defence organisation (MDO) in 2002. Other insurance companies left the market due to the rising number and size of public liability claims, doctors’ fears about the affordability of insurance premiums, and the impact of the 9/11 attacks on the global insurance market.
In 2002, to reduce the number of claims and size of payouts, the federal government established a Review of the Law of Negligence[2], chaired by the Hon. Justice David Ipp. The review panel consisted of a judge, a legal academic, a medical specialist and a regional mayor. It took advice from the medical community but did not consult injured patients. Not surprisingly, the recommended changes to the law disadvantaged injured patients severely.
The changes were initially adopted by NSW in its Civil Liability Act 2002 and were subsequently adapted by all other states and territories. The provisions apply to medical treatment injuries, other types of professional negligence and public liability claims. They do not apply to injuries from road accidents, the workplace or other circumstances covered by no-fault compensation schemes. The result is that people with healthcare injuries are doubly disadvantaged: they have no access to a no-fault insurance safety net and are subject to discriminatory legal frameworks that favour health professionals, hospitals and the insurers who fight for them.
The reforms limited growth in claims mainly by highly restrictive thresholds and caps on damages. Awards for loss of earning capacity are generally capped at the annual equivalent of three times the average weekly earnings (in total). Some of the liability provisions are also heavily weighted against injured patients (plaintiffs). In medical negligence cases, the defendants (health professionals or hospitals) control the key evidence, i.e., the medical records, and usually have no difficulty finding supporting expert witnesses, which is the main obstacle for injured patients, along with cost. The provisions specify that the plaintiff must always prove causation; no exceptions, even where critical records are withheld, redacted or incorrect. Where medical opinion considers that what was done was widely accepted as competent professional practice, the defendants cannot be found negligent. Even when a doctor has said sorry, his or her apology cannot be used as evidence of fault.
The 2002 provisions have since been extensively criticised for weakening the common law rights of injured patients. Both legally qualified members of the review panel have expressed concerns about the extent of the changes. In 2003, the legal academic, Professor Peter Cane, published an article in which he said the terms of reference prevented the review from examining the causes of the insurance crisis or considering no-fault compensation. He accepted that the recommendations; “…worsen[ed] the position, under tort law, of injured people relative to injurers”. He said: “…the most effective way of limiting liability and quantum of damages for negligence would be to abolish tort law and replace it with a no-fault administrative compensation scheme.”[3] In 2007 Justice Ipp criticised the legislation for placing unfair barriers to legitimate claims: “Certain of the statutory barriers that plaintiffs now face are inordinately high.”[4]
The 2002 changes to the law led to windfall profits by insurance companies as the number and size of claims fell. Between 2002 and 2004 the Australian Government stabilised the medical indemnity insurance market by bailing out the failed MDO, introducing legal reforms and market oversight, and providing financial guarantees and affordable cover for health professionals. Yet twenty years later, the tough legal barriers set up to discourage medical negligence claims remain. A Government Actuary report tabled in 2021 examined the medical insurance industry in Australia and found that over the previous decade insurance companies had enjoyed good stability, capital growth, net profits and low premiums[5].
Keeping these changes for decades despite insurance market recovery and growth is continuing to sacrifice social justice for power and profit. Ignoring the opportunity to learn from claims perpetuates the cycle of harm without the benefit of healthcare improvement. It results in a cost just as damaging but less publicised than insurance premiums: the cost borne by injured patients, the healthcare system and the community at large. Relying on litigation as the only way to access compensation is not only against the interests of injured patients. It is also against the interests of health professionals, who risk damage to their reputation, which may be so severe they leave the profession.
We believe a government enquiry is needed to examine the flaws of the current system and consider whether injured patients, health professionals and the health system would be more fairly served by a national no-fault compensation scheme.
If you agree that serious healthcare injuries should be fairly compensated, please share or donate a few dollars to help this petition grow.
Thank you for your continued support!
Sarah and Vickie
REFERENCES:
[1] Commonwealth Department of Human Services and Health, 1995. Review of Professional Indemnity Arrangements for Healthcare Professionals: Compensation and Professional Indemnity in Healthcare, [Tito F, chairman]. Final Report.Canberra. https://www.safetyandquality.gov.au/sites/default/files/migrated/ftitopir.pdf
[2] Justice Ipp, the Hon D. A., et al., 2002. Review of the Law of Negligence Final Report. Commonwealth of Australia, Canberra. https://treasury.gov.au/sites/default/files/2019-03/R2002-001_Law_Neg_Final.pdf
[3] Cane, Peter --- "Reforming Tort Law in Australia: A Personal Perspective" [2003] MelbULawRw 26; (2003) 27(3) Melbourne University Law Review 649. [4] “The Ipp Speeches”, Compilation of speeches delivered by the Hon. Justice D Ipp AO. Supreme Court, NSW. https://www.supremecourt.justice.nsw.gov.au/Documents/Publications/Speeches/Pre-2015%20Speeches/Assorted%20-%20A%20to%20K/ipp_speeches.pdf
[5] Australian Government Actuary, 2020. Evaluation of the Stability & Affordability of Medical Indemnity Insurance. Commonwealth of Australia. Canberra. https://aga.gov.au/sites/aga.gov.au/files/sites/aga.gov.au/files/publications/2020-11/mii_actuarial_review.pdf