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Australia's Medical Malpractrice Insurer Collapses - 2002-04-30

Australia's health system faces chaos after the collapse of one of the countries largest medical insurers. Although the government has stepped in, many doctors have abandoned non-emergency surgery until they have insurance. United Medical Protection (UMP) has gone into liquidation, leaving the country's private medical system shaken. UMP insured more than 30,000 doctors against claims for damages by patients.

The government has rushed to guarantee that doctors will be covered for any liability incurred in the next two months. Government ministers also are developing a longer-term solution.

The move hasn't satisfied the Australian Medical Association (AMA) which represents the nation's doctors. It says the government plan is unclear. The AMA says there is still uncertainty about high-risk specialties such as neurosurgery, where some surgeons have refused to treat private patients. Re-scheduling surgery in the over-burdened public sector won't be easy.

The AMA's federal president Dr. Kerryn Phelps says many doctors will not work until the confusion is sorted out.

"Doctors have to look at their own insurance situation and their practice situation and make their own decisions," she said. "The AMA will be giving advice on an independent basis when members call in but we can't give generalized advice to doctors at the moment because we can't say to them you can go forward and practice with confidence until we have the details worked out."

The Australian government says its short-term plan will protect doctors and patients at least until the end of June. Ministers will consider new legislation to provide a security net beyond that date.

Some doctors accuse the authorities of misunderstanding the magnitude of the problem. The collapse of the nation's biggest medical insurer has the potential to leave $225 million worth of past claims uncovered.