Premium Support Scheme Information guide

Premium Support Scheme

Information guide

This guide provides details of the Australian

Government Premium Support Scheme (PSS)

Effective from 1 July 2020

The Premium Support Scheme is an Australian Government

scheme that helps eligible medical practitioners with the

cost of their professional indemnity insurance. MDA National

Insurance Pty Ltd (MDA National) administers the PSS for its

members on behalf of the Government. The subsidy amounts

are payable for each premium year to MDA National who

provide cover to you.

Please note that the current PSS applies to contracts of insurance made with

MDA National on or after 1 July 2020. Updates have been made to reflect changes

to the Medical Indemnity Subsidy Scheme effective 1 July 2021. If your contract of

insurance was made prior to 1 July 2020, the old PSS applies. For information on the

previous PSS please refer here.

Who is eligible

You may be eligible for the PSS if you

are an eligible medical practitioner for a

premium year and if you have a contract

of insurance with MDA National providing

cover for that year and one of the

following applies.

You have substantial insurance costs

for the premium period

This means if your gross indemnity costs

for the period exceed 7.5% of your private

practice income for the period. Your gross

indemnity costs include:

a) the indemnity premium, excluding any

risk surcharge;

b) any membership fee from MDA

National; and

c) any costs payable by you to MDA

National for retroactive cover or

run-off cover.

Gross indemnity costs DO NOT include:

• GST or stamp duty on your contract

with MDA National;

• capital contributions required from

you under MDA National rules;

• payment of excess or deductibles;

• costs for earlier premium periods;

• charges imposed by an insurer for late

payment including premium, (excluding

any risk surcharge), membership fee,

and costs by you for retroactive cover

or run-off cover); or

• any amount of premium for a policy

that primarily covers the employees

of a medical practitioner or an entity

that runs a medical practice (being a

company, partnership or other entity).

Your private practice income for a

premium year is the total of the gross

income received by you for your private

medical practice for which MDA National

provides cover or you are personally

liable for. It does not matter where the

private practice income is received from.

Private practice income includes:

• Medicare benefits assigned to you;

• payments by individual patients;

• Veterans Affairs payments;

• workers compensation scheme

payments;

• payments by insurers for injuries.

You are a procedural general

practitioner practising in a rural area

This means you paid or are liable to pay a

premium for professional indemnity cover

with MDA National for that premium

period and:

• where your practice includes any of

the following activities:

৹ administration of anaesthetic;

৹ a surgical procedure for which

hospital facilities are or would

normally be required;

৹ an obstetric procedure;

৹ accident and emergency medicine;

৹ an invasive medical procedure,

except for the admission of

Implanon; and

• most of the services provided by

you in the relevant period for which

medical benefits are payable under

the Health Insurance Act 1973 (Cth),

are provided in Monash Medical Model

(MMM) 3 to 7 as classified by the

Australian Government Department

of Health.

Note: If you practised in a rural area and

were eligible for a subsidy under the

previous PSS prior to 1 July 2020, you will

remain eligible if you continue to practice

in the same area from 1 July 2020 to

the end of the relevant period of the

application. Please note, if you move your

practice from this location, you will lose

your grandfathered eligibility. However, if

you move to a new rural or remote MMM

(3 to 7) area, you will be eligible under

the new MMM arrangements.

You qualified under the Australian

Government's Medical Indemnity

Subsidy Scheme (MISS)

If you received a subsidy under MISS for

the premium period ending 30 June 2020,

you will need to make an application

under the PSS for the premium period

commencing 1 July 2021 as the MISS

ceases to operate from this date.

Who is Not Eligible

You are not eligible for the PSS if you

are a medical practitioner in the

following scenarios:

Nil private practice income

• your private practice income for the

premium period is nil.

Note: if your only practice in the premium

period is in the public sector and your

contract with MDA National provides

for retroactive and/or run-off cover only

in relation to incidents in the course of

your past private practice from which you

derived income, you may be eligible for

the PSS.

Low private practice income

The majority of your practice in the

premium period involves:

• the treatment of public patients in

one or more public hospitals; and

• your private practice income for the

premium year containing the period

is less than $1000; and

• you are not indemnified in your

private medical practice under an

agreement with an organisation that

operates one or more public hospitals

that allows you to carry out private

medical practice in the period.

Practising outside Australia

• in a premium year, you have practised

outside Australia and the external

territories for at least 6 months of

that year (counting as practice any

leave taken in the ordinary course

of practice).

Note: your overseas practice will not affect

your eligibility if it involves treatment of

Australian citizens or residents while on

a sporting, cultural or official tour, or any

aid work undertaken outside Australia as

this will be deemed to be practice within

Australia.

Subsidy not paid

• you have not paid MDA National or

another insurer for a subsidy that

MDA National or that insurer must

repay and MDA National or that

insurer has requested you repay

the amount.

How to apply

MDA National invites Members to

participate in the PSS prior to each

premium year. Eligible Members will

receive a PSS subsidy as a reduction

in their premium. You will need to fully

complete and return the PSS Estimate

Application form to elect to participate

in the PSS for each premium year. The

application form is available on the

Downloads section of our website

mdanational.com.au.

Application for advanced subsidy

Members wishing to participate in the

PSS prior to or during the premium

year must complete the PSS Estimate

Application form and include their

estimated gross indemnity costs for the

following premium year. If they meet

the eligibility criteria they will receive

an advance subsidy. The advance PSS

subsidy may be applied on the initial

offer of insurance or renewal if the

application is received prior to the offer

or renewal being generated. Otherwise, if

the premium is paid in full a refund will

be issued.

In the application form, you will be

required to confirm whether, if you are

eligible, you are willing for the PSS to

be paid to MDA National to help you

meet the cost of purchasing medical

indemnity insurance.

For the subsidy to be paid, you will need

to give information to MDA National

about your private practice income for

the relevant period, among other details.

You will also need to provide the Chief

Executive Officer of Medicare information

about your private practice income for the

relevant period, amongst other details.

If an over-payment of the subsidy is made

to MDA National, you will need to pay

us the amount we must pay to cover the

repayment of that amount.

Application after premium year

Once your actual gross indemnity costs

and private practice income are known,

you are required to complete and return

a statutory declaration to us disclosing

these figures within 12 months of the end

of the premium year.

Failure to provide a statutory declaration

within the deadline will mean that you

cease to be eligible for the PSS payment

for that premium year and you will be

required to repay the full subsidy to

MDA National.

How the PSS is calculated

Any Member who meets the basic

eligibility criteria (not taking into account

the procedural general practitioner

eligibility) qualifies for the PSS calculated

as follows:

60% of the amount by which your gross

indemnity costs (your premium) exceeds

7.5% of your private practice income.

For example:

Estimated or actual

private practice income

(ppi)

$100,000

Gross indemnity

costs excluding tax

$10,000

Basic PSS calculation

7.5% of ppi $7,500

Difference

(Gross indemnity costs

and 7.5% of ppi)

$2,500

PSS payment at 60%

of difference

$1,500

Rural procedural general practitioner

calculation

If you are a general practitioner who

is liable to pay a higher premium for

medical indemnity cover for procedural

general practice in an area classified

as a MMM area 3 to 7 by the Australian

Government Department of Health, you

qualify for the PSS calculated as follows:

75% of the difference between your

gross indemnity costs and that amount

of the lowest gross indemnity costs for

that period for a non-procedural general

practitioner for that period, who has

professional indemnity cover with us, is

practising in the same State or Territory

and has the same private practice income

for the period in the same range as

determined by us.

For the purpose of calculating your gross

indemnity costs, we need to determine

if you perform procedures that are non-

therapeutic cosmetic in nature. That

is, the procedure is not a medical or

professional service described in the

general medical services table under

the Health Insurance Act 1973 (Cth), and

is not a health service specified in a

determination under section 3C(I) of that

Act (which is a mechanism for including

medical and professional services items

or classes of items in the General

Medical Services Table). If your gross

indemnity cover for procedural general

practice is increased solely to cover

your performance of non-therapeutic

cosmetic procedures, then the increase in

premium for the extended services is not

to be included in your premium for the

purposes of calculating your PSS subsidy.

Eligible on different grounds in

the same period

If you are eligible under the PSS on more

than one ground, the amount of the

subsidy is the greater of the amounts

under the applicable grounds.

Public sector calculation

If you are eligible because you only work

in the public sector and do not receive

income from private practice but have

run-off or retroactive cover for prior

private practice, your estimated or actual

private practice income will be zero. The

PSS calculation will be 60% of your gross

indemnity costs.

If you previously received a

MISS subsidy

If you previously received a subsidy under

the MISS you will be required to apply for

the PSS as the MISS ceases to operate

from 1 July 2021.

Use our PSS calculator to assist you in

determining your eligibility for the PSS.

Ceasing to be eligible

You will cease to be eligible for the

PSS if:

• you fail to pay the premium for which

you are responsible within a premium

period;

• you have not provided a statutory

declaration confirming your actual

private practice income within the

timeframe specified;

• you have not repaid any overpayment

of a PSS subsidy within the timeframe

specified;

• you have an outstanding debt for an

overpayment of a PSS subsidy for a

previous premium period; or

• MDA National or Medicare Australia

believe that inaccurate information

has been provided.

If you are deemed no longer eligible for

the PSS, you must repay to MDA National

any PSS subsidy that you are not entitled

to within the timeframe specified by us.

If you have any queries, please

contact our Member Services team

on 1800 011 255.

For more information on the PSS please

refer to the Australian Government

Department of Health website.

The MDA National Group is made up of MDA National Limited ABN 67 055 801 771 and MDA National Insurance Pty Ltd (MDA National Insurance)

ABN 56 058 271 417 AFS Licence No. 238073. Insurance products are underwritten by MDA National Insurance. Before making a decision to buy or

hold any products issued by MDA National Insurance, please consider your personal circumstances, and read the Product Disclosure Statement

and Policy Wording available at mdanational.com.au. 214.13

mdanational.com.au

1800 011 255

peaceofmind@mdanational.com.au