Health Insurance (Eligible Collection Centres) Approval Principles 2007 (Cth)

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Health Insurance (Eligible Collection Centres) Approval Principles 2007

This document is a compilation of the current principles made under subsection 23DNBA(4) of the Health Insurance Act 1973.

It comprises the Health Insurance (Eligible Collection Centres) Approval Principles 2007 made on 21 June 2007 (with effect from 1 July 2007) (the Principal Determination) as amended by the Health Insurance (Eligible Collection Centres) Approval Amendment Principles 2007 made on 28 June 2007 (with effect from 1 July 2007).

This compilation was prepared on 10 July 2007 by the Department of Health and Ageing.


Contents

Part 1         Preliminary  4

  1. Name of Principles   4

  1. Commencement   4

  1. Definitions   4

Part 2         General principles for applications   6

  1. Eligibility of premises for approval   6

  1. Application for approval   6

  1. Timing of application   7

  1. Approvals   7

Part 3         Principles determining maximum numbers of approvals in respect of the 2007 – 2008 financial year for applicants operating category G pathology laboratories   9

  1. Interpretation   9

  1. Maximum number of approvals   9

  1. 2007–2008 nominal allocation   10

  1. Consequence of location of eligible collection centre   10

Part 4Principles determining maximum numbers of approvals in respect of a relevant financial year for applicants operating category G pathology laboratories   11

  1. Interpretation   11

  1. Maximum number of approvals   11

  1. Nominal allocation   12

  1. Consequence of location of eligible collection centre   12

Part 5Principles determining maximum numbers of approvals for applicants operating only category S pathology laboratories   13

  1. Interpretation   13

  1. Maximum number of approvals   13

  1. Applicants operating a category S pathology laboratory who held section 23DNB units            13

  1. Applicants operating a category S pathology laboratory who have not held section 23DNB units           13

Part 6Transfer of nominal allocation   14

  1. Interpretation   14

  1. Effect of acquisition or disposal of APA business   14

  1. Limitation on transfer of nominal allocation   14

  1. Adjustment of nominal allocation   15

  1. References to nominal allocation   15

Part 7Other matters   16

  1. Applicants operating both a category G pathology laboratory and a category S pathology laboratory     16

  1. Compliance with the Collection Centre Guidelines   16

  1. Review of decisions   16

  1. Delegation of powers and functions   16

Part 8Transitional   17

  1. Transitional   17

Notes   18


Part 1                 Preliminary

  1. Name of Principles

These Principles are the Health Insurance (Eligible Collection Centres) Approval Principles 2007.

  1. Commencement

These Principles commence on 1 July 2007.

  1. Definitions

(1)   In these Principles:

Act means the Health Insurance Act 1973.

Amendment Act means the Health Legislation Amendment (Medical Practitioners’ Qualifications and Other Measures) Act 2001.

APA means approved pathology authority.

category G pathology laboratory means an accredited pathology laboratory that has approval under section 23DN of the Act as a category GX or category GY accredited pathology laboratory.

category S pathology laboratory means an accredited pathology laboratory that has approval under section 23DN of the Act as a category S accredited pathology laboratory.

eligible applicant means an APA of a kind described in subsection 5(2).

licensed collection centre has the meaning given in subsection 23DA (1) of the Act as in force immediately before 1 December 2001.

Note   The definition of licensed collection centre was repealed on 1 December 2001.

new APA means, in respect of a particular financial year, an APA who:        

(a)    is not related to another APA; and

(b) during that financial year gave, for the first time, an APA undertaking under section 23DF of the Act that has been accepted by the Minister; and

(c)    is an eligible applicant.

Note   For the purposes of paragraph (a) of the definition of new APA, subsection 3(3) outlines the circumstances when an APA will be considered to be related to another APA.

older APA means, in respect of a particular financial year, an APA who:

(a)is an eligible applicant; and

(b)in a previous financial year gave, for the first time, an APA undertaking under section 23DF of the Act that was accepted by the Minister.

prescribed, in relation to a form, means prescribed by the Minister.

Previous Principles means the Health Insurance (Eligible Collection Centres) Approval Principles 2005.

recognized hospital has the same meaning as it did in the Act immediately before the commencement of item 31 of Schedule 1 to the Amendment Act.

Rural/Remote Areas Classification means the document of that name published in January 1994 by the Department of Human Services and Health.

Note   The Department of Human Services and Health publication ‘Rural/Remote Areas Classification’ should not be confused with a similar document published jointly by the Department of Human Services and Health and the Department of Primary Industries and Energy in November 1994.

unit of entitlement means a unit of entitlement allocated under section 23DNB of the Act, as in force before the commencement of item 31 of Schedule 1 to the Amendment Act.

Note   Item 31 of Schedule 1 to the Amendment Act commenced on 1 December 2001.

(2)   A word or expression used in these Principles that is defined in the Act has the same meaning in these Principles as it has in the Act.

Note   See, for example, the definition of the terms approval, Collection Centre Guidelines, and eligible collection centre in subsection 23DA(1) of the Act. Also, several expressions used in these Principles have the meaning given in subsection 3 (1) of the Act (for example, accredited pathology laboratory, approved pathology authority and pathology services table).

(3)   Subject to subsection (4), an APA is related to another APA if:

(a)    both APAs are employed (including employed under contract) by the same person, whether or not the person is also an APA; or

(b)    either of the APAs is employed (including employed under contract) by the other; or

(c)    both APAs are corporations and are connected entities within the meaning of the Corporations Act 2001; or

(d)    the APAs are partners (whether or not either or both of the APAs are individuals and whether or not other persons are in partnership with either or both of the APAs); or

(e)    20% or more of the issued share capital of the APA is held by an individual who either:

(i) is an APA; or

(ii) holds 20% or more of the issued share capital of another APA; or

(f)     a common individual is an officer (as defined in the Corporations Act 2001) of both APAs.

(4)   Notwithstanding subsection (3), an APA is not related to another APA if the APAs are owned, operated or employed by the Commonwealth, a State or an internal Territory, or an authority of the Commonwealth, a State or an internal Territory.

Part 2                 General principles for applications

  1. Eligibility of premises for approval

(1)   An application for approval of an eligible collection centre must not be considered by the Minister unless the premises to be occupied by the specimen collection centre meet the following criteria:

(a)    there is on the premises the necessary equipment for the collection and preparation of specimens for pathology procedures;

(b)    the staff at the premises:

(i)    are persons employed or engaged by the APA; and

(ii)    include persons properly trained in procedures for the collection and preparation of pathology specimens.

Note   These are secondary criteria for eligibility. For the primary criteria, see the definition of eligible collection centre in subsection 23DA (1) of the Act.

(2)   For the purposes of subparagraph (1)(b)(i), a person will be considered to be engaged by the APA only if the person is engaged directly or indirectly by the APA under a contract and, by virtue of that contract, acts under the general direction and control of the APA.

  1. Application for approval

(1)   An application for approval of an eligible collection centre must not be considered by the Minister unless it is made:

(a)    by an APA who is an eligible applicant; and

(b)    in writing and in the prescribed form.

Note   Prescribed forms may be obtained from Medicare Australia.

(2)   An APA is an eligible applicant if the APA:

(a)    operates, and is the proprietor of, an accredited pathology laboratory that is a category G pathology laboratory; or

(b)    has entered into an arrangement with another APA for the use of an accredited pathology laboratory that is a category G pathology laboratory and, immediately before the commencement of item 31 of Schedule 1 to the Amendment Act, operated a collection centre that:

(i)    was not located on the hospital premises of a recognized hospital; and

(ii)    was in an area that, in the Rural/Remote Areas Classification, is:

(A)     a Rural Major statistical local area; or

(B)     a Rural Other statistical local area; or

(C)     a Remote Major statistical local area; or

(D)     a Remote Other statistical local area; or

(c)    is an APA who:

(i)    operates, and is the proprietor of, an accredited pathology laboratory that is a category S pathology laboratory that is proposing to collect solely specimens within its speciality; and

(ii)    immediately before the commencement of item 31 of Schedule 1 to the Amendment Act, was the holder of a unit of entitlement to operate a licensed collection centre; or

(d)    operates, and is the proprietor of, an accredited pathology laboratory that is a category S pathology laboratory that:

(i)    is proposing to collect solely specimens within its speciality; and

(ii)    will be located on the same premises as the collection centre that is the subject of the application; and

(iii)    received accreditation as a category S laboratory after the commencement of item 31 of Schedule 1 to the Amendment Act.

(3)   An application must be supported by:

(a)    a written undertaking that the applicant will comply with the Collection Centre Guidelines in operating a specimen collection centre for which an approval is in force, except to the extent that, in a particular circumstance, the Minister accepts that compliance with some, or all, provisions of the Guidelines is not reasonably practicable; and

(b)    any additional information required by the Minister to enable the application to be decided.

  1. Timing of application

   An application which relates to an approval for the next following financial year should be lodged with the Minister before 1 June preceding the financial year to which the application relates.

Note   The consequence of making a late application is that an approval, if granted, may begin to take effect later than 1 July in the financial year to which it relates.

  1. Approvals

(1)   An approval must be expressed:

(a)    if the application complies with section 6 — to commence on 1 July in the financial year for which it is granted; and

(b)    in any case — to expire at the end of the financial year for which it is granted.

Note   An approval could expire earlier if it is revoked or cancelled under the Act.

(2)    An approval granted after the beginning of the financial year to which it relates may be expressed to commence at the beginning of the financial year if the Minister is satisfied that special circumstances justify the backdating.

(3)   The Minister must give to an APA who applies for approval, written notice of:

(a)    the decision to grant or not grant approval; and

(b) if the decision is to not grant approval, or to not backdate commencement as requested — their right to have the decision reconsidered by the Minister under section 23DO of the Act.

Part 3         Principles determining maximum numbers of approvals in respect of the 2007 – 2008 financial year for applicants operating category G pathology laboratories

  1. Interpretation

For this Part:

2006–2007 nominal allocation means, in respect of a particular APA, the greater of:

(a)the maximum number of approvals to which the APA was entitled (including any approvals granted) on 30 June 2007 in accordance with Part 3 of the Previous Principles, excluding:

(i)subsection 10(1) of the Previous Principles; and

(ii)subsection 11(3) of the Previous Principles; and

(iii) subsection 12(4) of the Previous Principles; and

(iv) section 15 of the Previous Principles; or

(b)the actual number of approvals held by the APA on 30 June 2007, excluding:

(i)2/3 of any approvals granted as a result of the operation of section 10 of the Previous Principles, rounded down to the nearest whole number; and

(ii)any approvals granted pursuant to subsection 11(3) of the Previous Principles; and

(iii) any approvals granted pursuant to subsection 12(4) of the Previous Principles; and

(iv) any approvals granted pursuant to section 15 of the Previous Principles.

2007–2008 financial year means the financial year commencing on 1 July 2007 and ending on 30 June 2008.   

2007–2008 nominal allocation means, in respect of a particular APA, the number determined in accordance with section 10 and subject to any adjustments pursuant to Part 6.

national population growth rate means the Australian 12 month population growth rate set out in the Australian Bureau of Statistics Australian Demographic Statistics – Catalogue number 3101.0  as at 1 April 2007 (which is 1.3%).

9          Maximum number of approvals

   The maximum number of approvals that may be granted under this Part to:

(a)    an APA who is a new APA to which paragraph 5(2)(a) applies; or

(b)    an APA who is an older APA to which either paragraph 5(2)(a) or 5(2)(b) applies;

in respect of the 2007–2008 financial year is:

(c)    subject to section 11 – 1 approval in respect of each 2007–2008 nominal allocation allotted to the APA; and

(d)    for an APA that proposes to operate an eligible collection centre in the same premises that it operates a category G pathology laboratory in the 2007–2008 financial year – 1 additional approval in respect of each eligible collection centre that it proposes to operate in the same premises as it operates a category G pathology laboratory.

10            2007–2008 nominal allocation

(1)   Subject to Part 6, the 2007–2008 nominal allocation for an APA described in paragraph 9(a) is 4.

(2)   Subject to Part 6, the 2007–2008 nominal allocation for an APA described in paragraph 9(b) is as follows:

(a)    if the APA has a 2006–2007 nominal allocation of less than three – a nominal allocation of 4; or

(b)    if the APA has a 2006–2007 nominal allocation of three or more – the higher of the following:

(i)    the number worked out under subsection (3); or

(ii)    the APA’s 2006–2007 nominal allocation plus 1.

(3)   For paragraph (2)(b)(i), the number is determined:

(a)    by adding the APA’s 2006-2007 nominal allocation to the number obtained by multiplying the 2006–2007 nominal allocation by the national population growth rate; and

(b)    if the result includes a fraction, by rounding it to the nearest whole number and, in the event of the fraction being 0.5, by rounding up.        

  1. Consequence of location of eligible collection centre

(1)In paragraph 9(c), a reference to 1 approval is taken to be a reference to 3 approvals if those approvals pertain to eligible collection centres in locations that, in the Rural/Remote Areas Classification, are:

(a)    Rural Other statistical local areas; or

(b)    Remote Other statistical local areas.

(2)   For the avoidance of doubt, subsection (1) does not apply to an approval the grant of which is allowed by operation of paragraph 9(d).

Part 4        Principles determining maximum numbers of approvals in respect of a relevant financial year for applicants operating category G pathology laboratories

  1. Interpretation

For this Part:

national population growth rate means the Australian 12 month population growth rate set out in the Australian Bureau of Statistics Australian Demographic Statistics – Catalogue number 3101.0 – most recent release as at 1 April of the financial year preceding the financial year in respect of which the nominal allocation for a particular APA is being calculated.

nominal allocation means, in respect of a particular APA for a relevant financial year, the number determined in accordance with section 14 and subject to any adjustments pursuant to Part 6.

previous financial year means the financial year immediately preceding the financial year in respect of which the nominal allocation for a particular APA is being calculated.

previous nominal allocation means, in respect of a particular APA, the nominal allocation pertaining to that APA at the end of the financial year immediately preceding the financial year in respect of which the nominal allocation for a particular APA is being calculated.

relevant financial year means, as the case requires:

(a)    the financial year to which a particular APA’s application for approval relates; or

(b)    the financial year in respect of which the nominal allocation for a particular APA is being calculated;

but does not include the 2007–2008 financial year which is covered in Part 3.

  1. Maximum number of approvals

   The maximum number of approvals that may be granted under this Part to:

(a)    an APA who is a new APA to which paragraph 5(2)(a) applies; or

(b)    an APA who:

(i)    is an older APA to which either paragraph 5(2)(a) or 5(2)(b) applies; and

(ii)    has previously had a nominal allocation or a 2007–2008 nominal allocation determined in accordance with section 10 or subsection 14(1): or

(c)    an APA who:

(i)    is an APA to which paragraph 5(2)(a) applies; and

(ii)    in the previous financial year was an APA to which paragraph 5(2)(c) or 5(2)(d) applied; and

(iii)    has not previously had a nominal allocation or a 2007–2008 nominal allocation determined in accordance with section 10 or subsection 14(1); and

(iv)    is not related to another APA;

in respect of a relevant financial year is:

(d)    subject to section 15 – 1 approval in respect of each nominal allocation allotted to the APA for the relevant financial year to which the approval relates; and

(e)    for an APA that proposes to operate an eligible collection centre in the same premises that it operates a category G pathology laboratory in the relevant financial year – 1 additional approval in respect of each eligible collection centre that it proposes to operate in the same premises as it operates a category G pathology laboratory.

  1. Nominal allocation

(1)   Subject to Part 6, the nominal allocation for an APA described in paragraph 13(a) or 13(c) is 4.

(2)   Subject to Part 6, the nominal allocation for an APA described in paragraph 13(b) is the higher of the following:

(a)    the number worked out under subsection (3); or

(b)    the APA’s previous nominal allocation plus 1.

(3)   For subsection (2)(a), the number is determined:

(a)    by adding the APA’s previous nominal allocation to the number obtained by multiplying the previous nominal allocation by the national population growth rate; and

(b)    if the result includes a fraction, by rounding it to the nearest whole number and, in the event of the fraction being 0.5, by rounding up.

  1. Consequence of location of eligible collection centre

(1)In paragraph 13(d), a reference to an approval is taken to be a reference to 3 approvals if those approvals pertain to eligible collection centres in locations that, in the Rural/Remote Areas Classification, are:

(a)    Rural Other statistical local areas; or

(b)    Remote Other statistical local areas.

(2)   For the avoidance of doubt, subsection (1) does not apply to an approval the grant of which is allowed by operation of paragraph 13(e).

Part 5                 Principles determining maximum numbers of approvals for applicants operating category S pathology laboratories

  1. Interpretation

For this Part, a reference to a relevant financial year is a reference to the financial year to which a particular APA’s application for approval relates.

  1. Maximum number of approvals

The maximum number of approvals that may be granted under this Part to an APA to which paragraphs 5(2)(c) or 5(2)(d) apply in respect of a relevant financial year is determined in accordance with this Part.

  1. Applicants operating a category S pathology laboratory who held units of entitlement

The maximum number of approvals that may be granted under this Part to an APA to which:

   (a)    paragraph 5(2)(a) does not apply; and

(b)    paragraph 5(2)(b) does not apply; and

(c)    paragraph 5(2)(c) applies (including an APA to which paragraph 5(2)(d) also applies);

in respect of a relevant financial year is the number that is equal to:

(d)the number of licensed collection centres that the APA was operating immediately before the commencement of item 31 of Schedule 1 to the Amendment Act; plus

(e)where applicable, one for each of the premises on which the APA operates a category S pathology laboratory of the kind described in paragraph 5(2)(d).

  1. Applicants operating a category S pathology laboratory who have not held units of entitlement

The maximum number of approvals that may be granted under this Part to an APA to which paragraph 5(2)(d) (but not section 18) applies is one for each of the premises on which the APA operates a category S pathology laboratory of the kind described in paragraph 5(2)(d).

Part 6                 Transfer of nominal allocation

20            Interpretation

For this part, a reference to operational approved collection centre means an approved collection centre that has been used to collect pathology specimens for pathology services in respect of which medicare benefits have been paid, and whose approval resulted from the operation of paragraph 9(c) or 13(d).

  1. Effect of acquisition or disposal of APA business

(1)   If an APA who is an eligible applicant (the acquiring APA) acquires or proposes to acquire business from another APA (the disposing APA) to which an approval has been granted, the acquiring APA may, pursuant to section 23, request the Minister to transfer the nominal allocation pertaining to that business to the acquiring APA from a specified date, not earlier than 2 weeks after the Minister receives the request.

(2)   For the purposes of this Part, an acquiring APA acquires business from a disposing APA only where the acquisition includes:

(a)    at least one category G pathology laboratory; and

(b)    at least one operational approved collection centre.

(3)   The request referred to in subsection (1) must be in writing, and state:

(a)    the name of the disposing APA; and

(b)    the nature and extent of the business acquired; and

(c)    the addresses of:

(i)    the laboratory or laboratories acquired; and

(ii)    the collection centre(s) acquired; and

(d)    the date of the acquisition of the business; and

(e)    the proposed specified date of transfer of nominal allocation; and

(f)    if the acquiring APA has disposed of business during the financial year to which the approval relates:

(i)    the name of each APA to which the acquiring APA has disposed of the business; and

(ii)    the nature and extent of the business disposed of.

(4)   Subject to section 22, the Minister may transfer nominal allocation, in accordance with section 23, to the acquiring APA, for so much of the financial year as remains from the specified date, if that action is consistent with the size of the business conducted by the APA as a result of the acquisition and disposition.

  1. Limitation on transfer of nominal allocation

(1)    The Minister may not, before 1 July 2012, transfer nominal allocation allotted in the period before 1 July 2012 from an APA who has been allotted a 2007–2008 nominal allocation in accordance with paragraph 10(2)(a), in an amount exceeding that determined in accordance with the following formula:

2 plus the 2006–2007 nominal allocation (as defined in section 8) for that APA.

(2)    The Minister may not, within 5 years of an APA being allotted:

(a)    a 2007–2008 nominal allocation in accordance with subsection 10(1); or

(b)    a nominal allocation in accordance with subsection 14(1);

transfer more than 2 of the nominal allocation of that APA allotted in the relevant 5 year period to another APA.

(3)    The nominal allocation of an APA may not be transferred to another APA except:

(a)    in accordance with this Part following a request under subsection 21(1); or

(b)    to correct an error.

  1. Adjustment of nominal allocation

(1)   Where an acquiring APA acquires business in accordance with section 21, the nominal allocation of the acquiring APA is increased, subject to subsection (3), by 1 in respect of each operational approved collection centre acquired.

(2)   Where an acquiring APA acquires business from a disposing APA in accordance with section 21, the nominal allocation of the disposing APA is reduced, subject to subsection (3), by 1 in respect of each operational approved collection centre disposed of.

(3)   Where an approved collection centre, whose approval resulted from the operation of section 11 or section 15, is the subject of a transaction referred to in section 21, the nominal allocation of:

(a)    the acquiring APA or the APA resulting from the merger (as the case requires) is increased by only 1/3 in relation to each such approved collection centre; and

(b)    the disposing APA is decreased by 1/3 in relation to each such approved collection centre.

(4)   Where the result in subsection (3) includes a fraction, it is to be rounded up the nearest whole number.

  1. References to nominal allocation

For the avoidance of doubt, in this Part a reference to nominal allocation includes 2007–2008 nominal allocation (as defined in section 8).

Part 7                 Other matters

  1. Applicants operating both a category G pathology laboratory and a category S pathology laboratory

An APA to which both:

(a)    paragraph 5(2)(a) and/or 5(2)(b); and

(b)    paragraph 5(2)(d);

applies may be granted approvals under:

(c)    Part 3 in respect of the 2007–2008 financial year; and

(d)    Part 4 in respect of a relevant financial year (as defined in section 12); and

(e)    section 19 in respect of a relevant financial year (as defined in section 16).

  1. Compliance with the Collection Centre Guidelines

An undertaking given by an applicant under paragraph 5 (3) (a) must include an undertaking to give to Medicare Australia written notice within 24 hours after a failure to comply with the Collection Centre Guidelines in operating an approved collection centre, including an explanation of the reason for the non-compliance.

  1. Review of decisions

(1)   Within 14 days after receiving an application for reconsideration under subsection 23DO (2DA) of the Act, the Minister must give the applicant written notice of the decision made under subsection 23DO (2DB).

(2)   An applicant for approval who is dissatisfied with a decision of the Minister under paragraph 5 (3) (a) may apply to the Administrative Appeals Tribunal for review of the decision.

Note Under section 27A of the Administrative Appeals Tribunal Act 1975, a decision-maker must give to persons whose interests are affected by the decision notice of the decision and of their right to have the decision reviewed. In giving notice, the Minister must have regard to the Code of Practice for Notification of Reviewable Decisions and Rights of Review determined under section 27B of that Act (Gazette No. S 432, 7 December 1994), accessible on the Internet at type="1">

  • Delegation of powers and functions

    • The Minister may delegate the Minister’s powers and functions under these Principles to the Chief Executive Officer of Medicare Australia.

    Part 8                 Transitional

    1. Transitional

    These Principles shall apply in relation to any application for an approval pertaining to the 2007–2008 financial year that is lodged prior to 1 July 2007.


    Notes to the Health Insurance (Eligible Collection Centres) Approval Principles 2007

    Note 1

    The Health Insurance (Eligible Collection Centres) Approval Principles 2007 as shown in this compilation comprises the Principal Determination amended as indicated in the Tables below.

    Table of Instruments

    Title

    Date of registration in the Federal Register of Legislative Instruments

    Date of
    commencement

    Application, saving or
    transitional provisions
    Health Insurance (Eligible Collection Centres) Approval Principles 2007 26 June 2007 1 July 2007
    Health Insurance (Eligible Collection Centres) Approval Amendment Principles 2007 28 June 2007 1 July 2007

    Table of Amendments

    ad. = added or inserted      am. = amended      rep. = repealed      rs. = repealed and substituted
    Provision affected How affected
    S. 10 ..................................... rs. by the Health Insurance (Eligible Collection Centres) Approval Amendment Principles 2007
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