Page 2629 - Week 12 - Thursday, 16 November 1989
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Why are premiums so high in the ACT? Firstly, there are hospital costs. In New South Wales a shared private ward in a public hospital is $332 per night for a compensable claim. In the ACT it is $450 per night. Why is this so? As of 1 August 1989, hospital fees in the ACT increased by up to 46 per cent, while some hospital fees for compensable injuries were increased by up to 95 per cent.
To spend a night in hospital in Canberra the cost is normally $160. For a compensable claim the cost is $450. So, if you break an arm by falling over in your backyard and have to spend a night in hospital, the cost will be $160. If, however, your arm is broken while at work, then the hospital cost will be $450. Canberra employers, motorists and taxpayers are subsidising the ACT hospital system to the tune of $290 per bed per day for compensable claims.
This equals a false economy, and increases premiums for employers dramatically. Why can a New South Wales injured worker be treated for $332 per day, yet an ACT worker needs to pay $450 a day? Why can private hospitals such as the John James Hospital charge $360 per day per bed or per room while a public hospital charges $450 per bed per day? Compensable claims are charged quite differently by doctors, specialists and hospitals in the ACT.
The increased charges are borne by the employer in the form of higher premiums, higher than need be, due to this inequality in medical charges. These inequalities need to be addressed to reduce premiums for workers compensation.
Secondly, there is no intermediary court in the ACT. If a dispute occurs in the ACT over a workers compensation claim, the options are to go to the Magistrates Court and then, if an appeal is appropriate, to the Supreme Court. The cost of Queen's Counsel is very expensive, as we all know. So any workers compensation claim that reaches the Supreme Court is obviously going to be of great expense.
The costs through the Magistrates Court are by no means small either, not only the personal costs to the party involved but also the costs in funds and time to our already overburdened court system. This cost is also borne by the employer through high premiums.
Thirdly, the insurance industry bases its premium on the relevant legislation in each State and the benefits and controls applying in that legislation. For example, the COMCARE scheme has a maximum lump sum payment of $120,000. The private sector in the ACT, however, due to the provisions of the obsolete ACT legislation, has an unlimited payout.
The ACT, for example, allows claims for the trip to work. People have claimed and received benefits for injuries incurred in their own homes because they were on their way out to go to work. These abuses result in higher payouts
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