34QHow exceptional claims indemnity is to be applied

#### 34Q How exceptional claims indemnity is to be applied (1) This section applies if an exceptional claims indemnity is paid to a person (the recipient) in relation to a liability of a person (the practitioner). > Note: The recipient will either be the practitioner himself or herself, or a person acting on behalf of the practitioner. Chief Executive Medicare to give recipient of payment a notice identifying the liability to be discharged (2) The Chief Executive Medicare must give the recipient a written notice (the payment notice) identifying the liability in relation to which the indemnity is paid, and advising the recipient how this section requires the indemnity to be dealt with. Recipient’s obligation if the amount of the indemnity equals or is less than the liability (3) If the amount of the indemnity equals or is less than the undischarged amount of the liability identified in the payment notice, the recipient must apply the whole of the indemnity towards the discharge of the liability. Recipient’s obligation if the amount of the indemnity exceeds the liability (4) If the amount of the indemnity is greater than the undischarged amount of the liability identified in the payment notice, the recipient must: (a) apply so much of the indemnity as equals the undischarged amount of the liability towards the discharge of the liability; and (b) if the recipient is not the practitioner—deal with the balance of the indemnity in accordance with the directions of the practitioner. Time by which recipient must comply with obligation (5) The recipient must comply with whichever of subsections (3) and (4) applies: (a) by the time specified in a written direction (whether contained in the payment notice or otherwise) given to the recipient by the Chief Executive Medicare; or (b) if no such direction is given to the recipient—as soon as practicable after the indemnity is received by the recipient. To avoid doubt, the Chief Executive Medicare may vary a direction under paragraph (a) to specify a different time. Debt to Commonwealth if recipient does not comply with obligation on time (6) If the recipient does not comply with whichever of subsections (3) and (4) applies by the time required by subsection (5), the amount of the indemnity is a debt due to the Commonwealth. (7) The debt may be recovered: (a) by action by the Chief Executive Medicare against the recipient in a court of competent jurisdiction; or (b) under section 42. (8) If the amount of the indemnity is recoverable, or has been recovered, as mentioned in subsection (7), no amount is recoverable under section 34T or section 41 in relation to the same payment of exceptional claims indemnity.