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Health insurance crises could soon be over

The federal government has presented further proposals for overcoming the health insurance companies' crises, and it is a case for the tax payer who is striving for salvation. Today the Prime Minister heralded a huge health insurance grant to physicians focusing on three specialties: midwifery, neuro surgery and general practitioners performing small surgeries known as "procedures".

It aims to reduce the high premium that these groups of physicians have to bear and to reduce the cost to the consumer. It is also planned to cover half of the cost if a physician acts negligently and the amount is higher than $2 million. Canberra, Senior Policy Advisor Catherine McGrath.

PETERINE MCGRATH: All interested stakeholders agreed that this was a real economic downturn. For example, in NSW last year, it costed each midwife more than $80,000 just to make sure. Today, the Prime Minister unblocked his frame for reforms. First, a grant for midwives, neuro surgeons and family doctors to help them cover their relatively high premiums.

KATHERIN MCGRATH: The government also plans to cover half the cost of medical malpractice payments of more than $2 million. Premier says this should lead to lower premium rates as it directly cuts the cost to the insurer. Mr JOHN HOWARD: These are inevitably complex and complex suggestions, but they have a very uniform subject, and this is supported by the tort law reforms, which are supported by the significant prolongation of the warranty by one year after the end of this year, and also recognizing that there is a particular issue for high-risk specialities, and also recognizing that there is a particular issue for very large demands, which we have tried to tackle all of these areas after in-depth consultations with all.

KATHERIN MCGRATH: In another important update, the government will expand the finance warranty to include failed insurance companies, United Medical Protection and Australasian Medical Insurance Limited. Australian Medical Association has embraced the changes as a good first move. GERRYN PHELPS: There is no doubt that the government has come a long way to provide assurance and safety to physicians and caregivers, but there is still much to be done, especially in the field of tort law in states and territories, and also in the implementation of a system of treatment and rehab for the seriously wounded.

Katherine Matogh, AMA Chairman Kerryn Phelps. Other medical groups were even more critically disposed. Royal College of Obstetrics Chairman John Campbell says that the government supports the system, but it is not a long-term response. Doctor Campbell says prospective physicians are hesitant to join his specialty.

*JOHN CAMPBELL: Twenty-four percent of our trainings lot said they wouldn't practise midwifery because of the medical-legal environment, which is difficult to practise not only financially but emotionally as well, because they know that any small error in a medical-legal environment could be against you. KATHERIN MCGRATH: If these changes were implemented very quickly, how long would it take to reverse the current state?

• JOHN CAMPBELL: Well, I think that exactly hinges on what was introduced, I mean there are a lot of things that have to be done in the tort law setting. We have to look at limiting the cost of damage, we have to look at eliminating long-term health care from the Tort system.

KATHERIN MCGRATH: While medical groups are demanding more crime reforms, so is the prime minister. Mr JOHN HOWARD: Can I say, in the light of all these suggestions, that they will not form an efficient whole unless they are backed up in great detail by the tort law reforms. COLVIN MARK: Prime Minister John Howard ends Catherine McGrath's account.