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VMO contract arrangements in NSW

Newsletter 01 March 2010

When Visiting Medical Officers (VMOs) contract with Area Health Services they should seek professional advice regarding the remuneration options that may be available to them at the public hospitals at which they will be providing services. A failure to do so may result in a lost opportunity to be remunerated at a higher rate or claim the entitlements to which VMO may be eligible at a particular hospital or hospitals.

Some hospitals in NSW only offer sessional payment arrangements, and similarly, some other hospitals only offer fee-for-service arrangements. At some hospitals, a Department may make an election to be remunerated at either sessional of fee-for-service rates.

VMOs should make the appropriate enquires and seek advice prior to entering into a service contract, be it a sessional or fee-for-service contract, as to whether they have a choice to be remunerated on a sessional or fee-for-service, or at another rate, depending upon the hospital/s at which they are contracted to provide services. In some cases, different hospitals within the same Area Health Service may have different contract and remuneration options available to a VMO. VMOs should not necessarily rely entirely on the advice provided to them by Area Health Services. There is no specific obligation upon an Area Health Service to bring remuneration options to the attention of the VMO, and if an election is not made at the appropriate time, an Area Health Service may refuse to retrospectively remunerate the VMO at the higher rate once an election is made at a later date.

The Joint Agreement between the New South Wales Branch of the Australian Medical Association (NSW) and the NSW Department of Health (Agreement) provides that VMOs who have appointments at hospitals where the Rural Doctors Settlement Package (RDSP) applies, those VMOs have the right to make an election as to the rates at which they will be remunerated.

Clause 15 of the Agreement provides that Fee-for-Service VMO Specialists have appointments exclusively in hospitals to which the Rural Doctors Package applies, they may choose to be remunerated under one of the following arrangements:

  1. the Fee-for-Service arrangements provided by this Agreement;
  2. Sessional arrangements; or
  3. Rural Doctors Package arrangements (until the time of the Agreement in the mid-1990s those arrangements were confined to general practitioner VMOs in those hospitals).

In circumstances where Fee-for-Service VMOs carry out work in RDSP hospitals and other hospitals at which the RDSP does not apply, they may also choose between the above three options for that part of their work which is actually carried out exclusively in RDSP hospitals. For example, a VMO may principally provide services at which he or she is remunerated at standard Fee-for-Service rates, and may also be providing services at smaller rural hospitals within the same Area Health Service at which RDSP rates apply. In order to be paid at RDSP rates, the VMO must advise the Area Health Service that he or she wishes to be so remunerated and should submit claims for payment for services provided at those hospitals at the higher rate.

In our experience, if an election is not made at the time the VMO enters into a service contract to provide services at a RDSP hospital, those VMOs who submit claims at standard rates will be paid at those rates until an election to be paid at the higher rate is made. Claims to be retrospectively remunerated for services provided at a RDSP hospital have recently been refused.

Under the terms of the 2007 Fee-for-Service and Sessional Determinations, VMOs providing services at Regional Hospitals may be entitled to be remunerated at higher rates for call backs (in the case of Fee-for-Service arrangements) and on-call and call backs (for sessional arrangements), and may be eligible to claims professional support payments.

A VMO should also carefully review the schedules to the VMO Contract to ensure that the schedules correctly reflect the VMO’s understanding of the services he or she is contracting to provide, the hospitals at which those services will be provided, and the budgeted hours.

VMOs should seek professional advice before entering into a service contract. For further information regarding your particular circumstances and contractual arrangement, please contact:

Scott Chapman, Partner

Newsletter 01 March 2010
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