The federal government has paid nearly $180,000 in legal bills in its battle to avoid paying $20,000 for a breast reduction for one of its former public servants.
The case has now been to the Federal Court twice, with former ATO official Roseanne Howes this month losing the latest round of her legal battle against federal workplace insurer Comcare that has been raging since 2013 over Ms Howes' 2009 breast reduction.
Comcare is determined not to pay for the surgery, claiming the surgery is unrelated to her work at the ATO.
Ms Howes insists the surgery was undertaken on the medical advice of five separate doctors to relieve the pain of the neck and shoulder problems she developed doing her job as a Tax Office public servant.
Officials from the insurer have revealed, in an answer to a question on notice from Liberal Senator James Paterson, that they had spent $101,000 in legal fees fighting the case in the court and the Administrative Appeals Tribunal.
Another $77,000 has been accrued in legal costs awarded to Ms Howes but taxpayers are to be spared a legal bill for the former public servant's latest unsuccessful appeal, with the Federal Court ordering her to pay Comcare's costs.
The senator is not happy about the legal bill and wants changes to legislation to rule out such appeals making their way through the courts.
Comcare has shown in the past that it will spend as much as it takes to fight what it deems to be important cases, paying more than $600,000 in legal bills between 2007 and 2013 fighting a public servant's workers' compensation claim for injuries sustained while having sex in a motel room during a work trip.
Ms Howes says long hours hunched over computers at work left her with serious neck and shoulder pain, which she had already been compensated for, and which made her weight balloon and prompted the need for the breast reduction surgery.
She says medication for her injuries exacerbated the problem of her breast size and the medical advice of five doctors was to undergo the surgery, despite Ms Howes herself not being keen.
But the latest appeal to the AAT failed in June after the tribunal senior member hearing the case James Popple preferred the medical evidence of a doctor who examined Ms Howes four years after the surgery, to the five doctors who told her before the operation that it could help with her neck pain
Federal Court Judge John Griffiths back up Mr Popple's decision in a judgement delivered earlier this month, awarding Comcare costs against Ms Howes, which could leave her facing a bill of up to $50,000.
Her barrister Allan Anforth said a further appeal was unlikely, but only because Ms Howes could no longer afford to litigate against federal bureaucrats who routinely used taxpayers money to crush ordinary citizens.
Mr Anforth said his client had every right to be compensated for treatment taken on the advice of five doctors.
"The doctors at the time have to make a decision based on what they know at the time," he said.
Senator Paterson wants legislative changes to stop expensive appeals progressing through the courts.
"Public servants who legitimately sustain an injury at work obviously deserve to be fairly compensated," the Senator said.
"But too many decisions by Comcare to refuse unreasonable claims have been appealed in recent years at great cost to taxpayers."