No fault compensation for healthcare injuries has been recommended twice in Australia in the past half-century but has never been implemented. It is still in the ALP National Platform! On page 56, it states: "The only factor that should determine the level of care someone receives is the level of support they require, not the cause of their injury. Labor will therefore ensure the National Injury Insurance Scheme (NIIS) complements the NDIS". Why has it proven so difficult to institute a reform that would mean patient harm is acknowledged and compensated?

Please share our petition for no-fault compensation for Australian injured patients.

In 1974 the Woodhouse Committee recommended no-fault compensation for personal injury including medical treatment injuries, but the Whitlam Labor government lost power in 1975 before the recommendation was implemented. In 2011 the Productivity Commission recommended establishment of a National Disability Insurance Scheme (NDIS) and the National Injury Insurance Scheme (NIIS). Following the defeat of the Rudd Labor government in 2013, only the NDIS was established.

A first step towards comprehensive national no-fault compensation for healthcare injuries would be to establish the NIIS. The NIIS is intended to cover catastrophic injuries only from motor vehicle accidents, workplace accidents, medical treatment injuries and other injuries in the community. There are significant differences between the NDIS and the proposed NIIS:

• Disability with permanent impairment qualifies people for the NDIS; catastrophic injury qualifies people for the NIIS;
• People aged 65 and under are eligible for the NDIS; the NIIS has no age restrictions;
• The NDIS is only open to Australian citizens, permanent residents and special visa holders; the NIIS has no such restrictions;
• The NDIS cannot provide acute care and rehabilitation services; the NIIS can;
• The NDIS is funded from federal consolidated revenue; the NIIS is intended to be a federation of state-based schemes, funded from existing motor vehicle accident, workers’ compensation, medical indemnity insurance and other sources. So far, the NIIS has only been established in Queensland, in 2016, where it was initially limited to serious injuries from motor vehicle accidents.

While a decentralised scheme like the NIIS may be complex, it may also have advantages. It allows each state or territory to develop its own arrangements, based on a shared set of eligibility criteria, assessment tools and benchmarks. It would allow, for example, comparison of the healthcare injury compensation schemes developed by different states and adoption of their best features elsewhere. It would enable clear lines of accountability to the state health authorities that oversee hospital systems. State-based schemes might also be quicker to establish than a single national scheme. 

According to a 2011 Treasury discussion paper, medical treatment injuries are the third largest cause of catastrophic injury, after motor vehicle and general/criminal injuries, accounting for 11% of such injuries. If any states establish a medical treatment injuries compensation scheme as part of the NIIS, two issues should be reconsidered:

• Which injuries should be covered? The NIIS is currently limited to catastrophic injuries. A 2011 draft discussion paper on medical treatment injuries prepared by Treasury officials listed catastrophic injuries as including spinal cord injury, brain injury, multiple amputations, burns and blindness. These injuries were based on the benchmarks for road accident injuries, which were considered “a sound basis” for determining minimum benchmarks for a medical treatment injuries stream.

Injuries from road accidents are very different from healthcare injuries. The most common healthcare-acquired complications in 2021-22 were healthcare-associated infections (78,000 hospitalisations), delirium (26,000 hospitalisations) and cardiac complications (26,000 hospitalisations). The signature of neurotoxic damage to the brain (such as Sarah has) is abnormal electrical activity, as shown on EEG or evoked potentials, with no underlying structural damage. This would not meet the definition of brain injury in the draft discussion paper. Any list of compensable healthcare injuries should be based on recognised sentinel events and hospital-acquired complications, not on injuries from road accidents.

In its 2011 submission, the AMA, said: “A medical accident may be defined, for the purposes of assessing eligibility for support under the NIIS, as a rare and serious outcome of medical treatment.” Pelvic mesh-related injuries (such as Vickie has) are a serious outcome of medical treatment, but with thousands of women affected, how can they be considered rare? The NIISQ Queensland covers “serious personal injuries” from motor vehicle accidents. “Serious injury” is a more appropriate criterion than “catastrophic injury”, which risks leaving many injured patients with no coverage, and forced to take their chances with the litigation system. 

People with catastrophic injuries are entitled to have their needs fully acknowledged and consistent and adequate care and support provided, no matter what the cause of their injury or where they live. But a no-fault compensation scheme for healthcare injuries should cover all serious injuries, not just catastrophic injuries, especially if the latter are defined in a way likely to exclude most seriously injured patients. In healthcare a serious injury is one resulting in permanent or long-term disability, or death.

• What should compensation from the NIIS cover? As currently proposed, the NIIS would cover only long-term care and support, not pain and suffering and economic loss. This means that even those injured patients covered by the NIIS would still have to sue for compensation for these losses. At the very least, the NIIS should cover loss of earnings, as New Zealand’s Accident Compensation Corporation does. Otherwise, the main benefit of a no-fault insurance scheme could be lost: providing adequate compensation so that the vast majority of seriously injured patients are not left out of pocket. 

Australia already has no-fault compensation schemes for injuries from workplace accidents in all jurisdictions, all of which cover economic loss. It has no-fault compensation schemes for road accident injuries covering economic loss in NSW, the ACT, Victoria, Tasmania and the Northern Territory. Queensland’s NIISQ, South Australia’s Lifetime Support Scheme and Western Australia’s Catastrophic Injury Scheme are all no-fault schemes but claims for economic loss must be submitted through the state’s fault-based Compulsory Third Party (CTP) scheme, which means injured drivers or passengers in these states have to prove negligence to obtain compensation for such loss. Since August 2021, Australia has had a national no-fault scheme for Covid vaccine injuries which covers economic loss. 

So, implementation of the NIIS would be an important advance but only a first step towards a comprehensive no-fault scheme for healthcare injuries. Ultimately, we need a scheme that provides reasonable and necessary cover not only for treatment, care and support but also for economic loss and pain and suffering. If well designed, such a scheme would provide incentives to speed improvements in patient safety. This is also the view of health economist and former Director of the Grattan Institute Dr Stephen Duckett, who was interviewed by the ABC when Vickie called for compensation reform in 2021.

According to the 2021 ALP national platform, the ALP remains committed to the establishment of an NIIS. Well-populated states such as NSW and Victoria could follow Queensland’s example and introduce a single stream of the NIIS, namely a compensation scheme for healthcare injuries. NSW is soon to hold a Special Commission of Inquiry into its health services; we are calling for patient harm and appropriate compensation to be included in its terms of reference. 

Half a century after no-fault compensation for healthcare injuries was first recommended, it's time to develop a plan of action for its implementation. Please continue to share our petition and encourage people to sign it. If you live in New South Wales, please consider writing to your MP to support the inclusion of patient harm and appropriate compensation in the terms of reference for the NSW Special Commission of Inquiry into health services.

Gratefully,

Sarah and Vickie

References available on request to Sarah at exactitude@iprimus.com.au