A child was left permanently disfigured after a departmental directive stemmed the tide of medical transfers from Australia's offshore detention centres to the mainland, Labor senator Kristina Keneally has said.
The Senate began to debate a Coalition bill to dismantle the Medevac scheme on Monday.
The scheme has allowed refugees and asylum seekers from Manus Island and Nauru to come to Australia for medical treatment on the recommendation of two Australian doctors.
Senator Keneally read from the diary of Dr Chris Jones, who worked on Nauru in August last year, before the scheme came into effect.
Dr Jones recalled being in a teleconference with an orthopaedic surgeon who had operated on a child to remove metalwork from their left forearm.
The surgeon had only been able to remove one of two of the plates because the operation had been delayed by 12 months.
The remaining plate had become embedded in bone and attempting to remove it would do more damage.
Senator Keneally said the case shed light on how doctors were "being disregarded by departmental bureaucrats".
"Let's reflect on that for a moment. Doctors - the people we all trust when we're sick, when we're unwell, when we're struggling mentally - were being ignored by people with no medical qualifications," she said.
Senator Keneally said that stemmed from a 2015 directive from the then Department of Immigration and Border Protection, to the staff of the then Australian Customs and Border Protection Service.
It said: "Unless there are compelling medical reasons, supported by second opinions, to do with life and death situations, or situations involving the risk of life time injury or disability, transfers to Australia should be avoided as a general rule and should in any event become increasingly rare".
"Minutes from internal meetings at the then Department of Immigration and Border Protection in 2016 revealed this directive effectively stopped medical transfers to Australia," Senator Keneally said.
"There was a 92 per cent drop in medical transfers. Transfers dropped from close to 550 in 2014-15 to approximately 50 in 2015-16. That's a drop of 550 to just 50 in one year.
"On Manus Island, broader Papua New Guinea and Nauru, requests for medical transfer by hardworking, honest and committed doctors started being ignored. People without medical knowledge were deciding if sick people received any treatment or not. Over time the problem grew, and medical transfers were denied time and time again."
Greens senator Nick McKim said the Medevac scheme "took those decisions out of the hands which they should never have been in".
"It has delivered people the health care that they so desperately needed and that they had previously been deliberately deprived of by mendacious ministers and bureaucrats, who were acting in political interest and self-interest rather than in accordance with human rights law, with humanitarian principles and with the principles of the medical profession," Senator McKim said.
Meanwhile the New Zealand government has confirmed a deal that would allow 150 asylum seekers from Australia's offshore detention centres to be resettled in the country is still on the table.
The New Zealand deal is rumoured to be the mysterious condition independent Tasmanian senator Jacqui Lambie has demanded in exchange for her vote to repeal the medical evacuation legislation.
Senator Lambie has not confirmed this, nor would the government be drawn on the negotiations with the crossbencher on Monday.
But Prime Minister Scott Morrison said the Coalition had not softened its stance on the longstanding offer.
"Our policies on those matters haven't changed," Mr Morrison said.