Private Health Insurance Incentives Act 1998 (Cth)

Private Health Insurance Incentives Act 1998

Act No. 121 of 1998 as amended

[Note: This Act was repealed by Act No. 32 of 2007 on 1 July 2008]

This compilation was prepared on 5 April 2007

taking into account amendments up to Act No. 32 of 2007

The text of any of those amendments not in force

on that date is appended in the Notes section

The operation of amendments that have been incorporated may be

affected by application provisions that are set out in the Notes section

Prepared by the Office of Legislative Drafting and Publishing,

Attorney‑General’s Department, Canberra

Contents

An Act to provide incentives for private health insurance, and for related purposes

Chapter 1IntroductionPart 1PreliminaryDivision 1Preliminary

1‑5Short title [see Note 1]

This Act may be cited as the Private Health Insurance Incentives Act 1998.

1‑10Commencement [see Note 1]

This Act commences on the day on which it receives the Royal Assent.

1‑15Identification of defined expressions

1. (1)

   Some of the expressions used in this Act are defined in the Dictionary of defined expressions in Part 8.

2. (2)

   Most defined expressions are identified by an asterisk appearing at the start of the expression. The footnote that goes with the asterisk contains a signpost to the definitions in the Dictionary.

   Note: The expressions you and Medicare Australia CEO are not asterisked.

3. (3)

   Once a defined expression has been identified by an asterisk, later occurrences of the expression in the same subsection are not usually asterisked.

4. (4)

   Expressions are not asterisked in Guides and notes contained in this Act.

5. (5)

   In this Act, you means an individual but does not include an individual in the capacity of a trustee or the capacity of an employer.

Division 2Guide to this Act

2‑1What this Act is about

Chapter 1 deals with some preliminary matters.

Chapter 2 establishes a scheme under which people who, or whose employers on their behalf, pay premiums under certain private health insurance policies can obtain payments from the Commonwealth in return for the payment of the premiums.

Chapter 3 establishes an alternative scheme under which people who are covered by such private health insurance policies can have the premiums payable under those policies reduced.

If, under Chapter 3, a premium is reduced, no payment can be received under Chapter 2 in respect of the premium (see subsection 4‑5(2)).

If, under Chapter 2, a payment is received in respect of a premium, no reduction is allowed in respect of the premium under Chapter 3 (see subsection 12‑5(4)).

Chapter 4 deals with matters that are relevant to both Chapter 2 and Chapter 3.

Note: The incentive payments scheme and the premiums reduction scheme are complemented by the private health insurance offset provided for by Subdivision 61‑H of the Income Tax Assessment Act 1997.

Chapter 2The incentive payments schemePart 2Entitlement to, and calculation of, payments under incentive payments schemeDivision 3Introduction

3‑1What this Part is about

This Part explains who is entitled to payments under the scheme and how the amounts payable are calculated

Table of Divisions in this Part

3 Introduction

4 Entitlement to, and calculation of, payments

Division 4Entitlement to, and calculation of, payments

4‑5Entitlement to payments

1. (1)

   You are entitled to a payment under this Chapter if:

   1. (a)

      you have paid, or your employer has paid as a *fringe benefit for you, a premium under an *appropriate private health insurance policy for the whole or a part of the financial year that began on or after 1 July 1998 and before 1 July 2007; and

   2. (b)

      the policy was issued by a *health fund.

2. (2)

   You are not entitled to a payment under this Chapter in respect of a payment of premium if the premium is less than it would otherwise have been because of the operation of Chapter 3.

4‑6Receipt for payment of premiums

1. (1)

   Subject to subsection (2), a *health fund to which a premium has been paid as mentioned in subsection 4‑5(1) must, if requested to do so by the person who made the payment, give to the person a receipt for the payment in such form, and containing such information, as are determined in writing by the Medicare Australia CEO.

2. (2)

   Subsection (1) does not apply if the premium to which the payment relates has been reduced under Chapter 3.

4‑10Calculation of the amount payable

Financial Year 1998‑99

1. (1)

   The amount payable under this Chapter for an amount of premium paid under a policy for the financial year that began on 1 July 1998 depends upon whether or not a person was registered, or eligible to apply for registration, before 1 January 1999 under the Private Health Insurance Incentives Act 1997 in respect of the policy for the financial year.

If no‑one registered or eligible for registration

1. (2)

   If no person was so registered or eligible to apply for registration, the amount payable is 30% of the amount of the premium paid by you, or by your employer as a *fringe benefit for you, under the policy for the financial year.

If someone registered or eligible for registration

1. (3)

   If a person was so registered or eligible to apply for registration, the amount payable is the greater of the amount worked out under paragraph (a) and the amount worked out under paragraph (b):

   1. (a)

      30% of:

      1. (i)

         the amount of the premium paid by you, or by your employer as a *fringe benefit for you, under the policy for the financial year; or

      2. (ii)

         if, because of the operation of the Private Health Insurance Incentives Act 1997, that amount of premium was less than the amount of premium that would otherwise have been payable—the amount of premium that would otherwise have been payable; and

   2. (b)

      the *incentive amount for the policy for the financial year.

Financial year 1999‑2000 or later financial year

1. (4)

   The amount payable under this Chapter for an amount of premium paid under a policy for a later financial year depends upon whether or not a person was registered, or eligible to apply for registration, before 1 January 1999 under the Private Health Insurance Incentives Act 1997 in respect of the policy for the financial year that began on 1 July 1998.

If no‑one registered or eligible to apply for registration

1. (5)

   If no person was so registered or eligible to apply for registration, the amount payable is the sum of the following amounts:

   1. (a)

      30% of the amount of the premium paid by you, or by your employer as a *fringe benefit for you, under the policy in respect of days in the later financial year on which no person covered by the policy was aged 65 years or over;

   2. (b)

      35% of the amount of the premium paid by you, or by your employer as a *fringe benefit for you, under the policy in respect of days in the later financial year on which:

      1. (i)

         at least one person covered by the policy was aged 65 years or over; and

      2. (ii)

         no person covered by the policy was aged 70 years or over;

   3. (c)

      40% of the amount of the premium paid by you, or by your employer as a *fringe benefit for you, under the policy in respect of days in the later financial year on which at least one person covered by the policy was aged 70 years or over.

If someone registered or eligible to apply for registration

1. (6)

   If a person was so registered or eligible to apply for registration, the amount payable is the greater of:

   1. (a)

      the sum of the amounts referred to in paragraphs (5)(a), (b) and (c); and

   2. (b)

      the *incentive amount for the policy for the later financial year.

Amount payable to be reduced by any tax offset

1. (7)

   The total amount payable under this Chapter for a policy for a financial year is reduced by the amount of any tax offset received under Subdivision 61‑H of the Income Tax Assessment Act 1997 for the total amount of the premium paid by you, or by your employer as a *fringe benefit for you, under the policy for that financial year.

Disregard premium that relates to period before 1 January 1999

1. (8)

   In working out an amount payable under this Chapter for an amount of premium paid by you, or by your employer as a *fringe benefit for you, under a policy, disregard any part of the amount of the premium paid that relates to a period before 1 January 1999.

Amount payable reduced if premium reduced under 1997 Act

1. (9)

   If, because of the operation of the Private Health Insurance Incentives Act 1997, the amount of a premium paid by you, or by your employer as a *fringe benefit for you, under a policy for a period after 31 December 1998 was less than the amount that would otherwise have been payable, the amount payable under this Chapter in respect of the premium is reduced by the amount of the difference.

4‑12Saving provision where a person 65 years or over ceases to be covered by policy

1. (1)

   This section applies to a person (the first person) at a particular time (therelevant time) if:

   1. (a)

      at any time before the relevant time, the first person was covered by an *appropriate private health insurance policy (the original policy), other than as a *dependent child; and

   2. (b)

      at any time when the person was so covered, the amount payable under this Chapter was 35% or 40% of the amount of premium payable under the original policy because of the age of another person (the entitling person) covered by the policy; and

   3. (c)

      before the relevant time, the entitling person ceased to be covered by the original policy.

2. (2)

   If, at the relevant time:

   1. (a)

      the first person is covered by an *appropriate private health insurance policy (which may be either the original policy or another policy); and

   2. (b)

      each other person (if any) covered, since the entitling person ceased to be covered by the original policy, by an *appropriate private health insurance policy that also covered the first person:

      1. (i)

         is or was covered as a *dependent child; or

      2. (ii)

         is a person who was covered by the original policy immediately before that cessation;

subsections 4‑10(5) and (6) are taken to apply (other than for the purposes of working out the *incentive amount) as if the entitling person:

1. (c)

   were covered by the policy mentioned in paragraph (a); and

2. (d)

   were the same age as at that cessation.

1. (3)

   Subsection (2) does not apply if its application would result in the amount payable under subsection 4‑10(5) or (6) being less than it would otherwise have been.

4‑15Claims

To get the payment, you must make a claim for it.

Note: See Division 6 in Part 3 for rules about claims.

Part 3Claims for payments under incentive payments schemeDivision 5Introduction

5‑1What this Part is about

This Part explains how claims may be made for payments under the scheme and how claims are determined.

Table of Divisions in this Part

5 Introduction

6 Claims for payments

Division 6Claims for payments

6‑5Need for a claim

If you want to be paid an amount to which you are entitled under section 4‑5, you must make a proper claim for payment of the amount.

6‑10Form of claim

1. (1)

   To be a proper claim, a claim must:

   1. (a)

      be in a form (including an electronic form) approved by the Medicare Australia CEO; and

   2. (b)

      provide all the information, and be accompanied by any documents, required by the form; and

   3. (c)

      be sent to or lodged at an office of Medicare Australia, or a place approved by the Medicare Australia CEO; and

   4. (d)

      be so sent or lodged in the financial year in which the payment of the premium to which the claim relates was made or the next financial year.

2. (2)

   The Medicare Australia CEO must not approve a form under paragraph (1)(b) that requires you to provide the *tax file number of any person.

6‑15Withdrawal of claim

You may at any time, by writing sent to or lodged at an office of Medicare Australia, or a place approved by the Medicare Australia CEO, withdraw a claim.

6‑20Determination of claim and payment of amount

1. (1)

   The Medicare Australia CEO must make a decision granting or refusing the claim within 14 days after the day on which the claim is made.

2. (2)

   If the claim is granted, the Medicare Australia CEO must pay to you the amount to which you are entitled.

3. (3)

   If the claim is refused, the Medicare Australia CEO must cause to be served on you a notice stating that the claim has been refused and setting out the reasons for the refusal.

6‑25Application for reconsideration of decision refusing a claim

1. (1)

   If the claim is refused, you may apply to the Medicare Australia CEO for the Medicare Australia CEO to reconsider the decision.

2. (2)

   The application must:

   1. (a)

      be in writing; and

   2. (b)

      set out the reasons for the application.

3. (3)

   The application must be made within:

   1. (a)

      28 days after the day on which you are notified of the decision; or

   2. (b)

      if, either before or after the end of that period of 28 days, the Medicare Australia CEO extends the period within which the application may be made—the extended period for making the application.

6‑30Reconsideration by Medicare Australia CEO

1. (1)

   Upon receiving such an application, the Medicare Australia CEO must:

   1. (a)

      reconsider the decision; and

   2. (b)

      either affirm or revoke the decision.

2. (2)

   If the Medicare Australia CEO revokes the decision, the revocation is taken to be a decision granting the claim.

3. (3)

   The Medicare Australia CEO must give to you a notice stating his or her decision on the reconsideration together with a statement of his or her reasons for the decision.

6‑35Deadline for reconsiderations

1. (1)

   The Medicare Australia CEO must make his or her decision on reconsideration of a decision within 28 days after the day on which he or she received an application for reconsideration.

2. (2)

   The Medicare Australia CEO is taken, for the purposes of this Division, to have made a decision confirming the original decision if the Medicare Australia CEO has not told the applicant of the decision on the reconsideration before the end of the period of 28 days.

   Note: A decision confirming the original decision is reviewable under section 19‑10.

Part 4Obtaining of informationDivision 7Introduction

7‑1What this Part is about

This Part is about the obtaining of information by the Medicare Australia CEO for the purposes of this Chapter.

Table of Divisions in this Part

7 Introduction

8 Notification requirements

Division 8Notification requirements8‑5 Notification requirementsclaimants

1. (1)

   If you have made a claim under section 6‑5 for a payment of an amount and:

   1. (a)

      a matter, event or circumstance occurs that affects your entitlement to a payment for which the claim is made; or

   2. (b)

      a change occurs in the premium, or in the amounts or frequency of the payments in respect of the premium, under the policy;

you must, within 30 days after the occurrence of the matter, event, circumstance or change, give notice to the Medicare Australia CEO containing particulars of it.

1. (2)

   You are guilty of an offence if:

   1. (a)

      you are required by subsection (1) to give a notice to the Medicare Australia CEO containing particulars of a matter, event, circumstance or change referred to in that subsection; and

   2. (b)

      you fail to comply with the requirement.

   Maximum penalty: 60 penalty units.

   Note: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

2. (3)

   Section 4K of the Crimes Act 1914 does not apply to the obligation to provide information pursuant to subsection (1).

Chapter 3Premiums reduction schemePart 5Participation in the premiums reduction schemeDivision 9Introduction

9‑1What this Part is about

This Part explains when a reduction in premium can be obtained and how the premiums are reduced.

Table of Divisions in this Part

9 Introduction

10 Who is eligible to participate in the premiums reduction scheme

11 How people participate in the premiums reduction scheme

12 What effect the premiums reduction scheme has on insurance premiums

Division 10Who is eligible to participate in the premiums reduction scheme

10‑5Eligibility to participate in the premiums reduction scheme

You are eligible to participate in the *premiums reduction scheme in respect of a *private health insurance policy if:

1. (a)

   the policy is an *appropriate private health insurance policy; and

2. (b)

   the *health fund that issued the policy is a *participating fund; and

3. (c)

   you are eligible to apply under Division 11 for registration in respect of the policy.

Division 11How people participate in the premiums reduction scheme

11‑5Registration by Medicare Australia CEO

1. (1)

   If you are eligible to apply for registration in respect of an *appropriate private health insurance policy, you may apply under section 11‑15, to the *health fund that issued the policy, to be registered by the Medicare Australia CEO in respect of the policy.

2. (2)

   If the *health fund receives such an application, it must notify the Medicare Australia CEO of the application.

3. (3)

   On receiving a notice under subsection (2), the Medicare Australia CEO must register the applicant in respect of the policy if the Medicare Australia CEO is satisfied that the applicant is eligible to participate in the *premiums reduction scheme in respect of the policy.

4. (3A)

   If a person who is registered in respect of an *appropriate private health insurance policy becomes eligible to apply for registration under this Division in respect of another appropriate private health insurance policy issued by the *health fund that issued the first‑mentioned policy, the person is taken, by this subsection, to be registered in respect of the other policy.

5. (4)

   When the Medicare Australia CEO registers an applicant in respect of an *appropriate private health insurance policy, the Medicare Australia CEO must give notice of the registration to the *health fund that issued the policy.

11‑10Eligibility to apply for registration

1. (1)

   You are eligible to apply for registration under this Division in respect of an *appropriate private health insurance policy if:

   1. (a)

      you have paid, or your employer as a *fringe benefit for you has paid, a premium under the policy for the whole or a part of the financial year that began on 1 July 1998 or a later financial year; or

   2. (b)

      you are covered by the policy (otherwise than as a *dependent child); or

   3. (c)

      every person covered by the policy is a dependent child and you are a *parent of any one or more of them.

(2)

However, no‑one is eligible to apply for registration under this Division after 30 June 2007 .

11‑15Application for registration

1. (1)

   An application by you under this section must be in a form approved by the Minister and must state the following details:

   1. (a)

      the name of the *health fund to which the application is made;

   2. (b)

      your full name;

   3. (c)

      your date of birth;

   4. (d)

      your residential address;

   5. (e)

      your Medicare card number;

   6. (f)

      the fund membership number of the policy;

   7. (g)

      whether the policy in respect of which you have applied to be registered covers only one person or covers more than one person;

   8. (h)

      the full name and date of birth of each person covered by the policy (other than yourself);

   9. (i)

      whether any of those persons are *dependent children;

   10. (j)

       any other information determined in writing by the Minister.

2. (2)

   For the purposes of paragraph (1)(j), the Minister must not make a determination requiring you to provide the *tax file number of any person.

3. (3)

   Determinations under paragraph (1)(j) are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

11‑20Notifying the Medicare Australia CEO

1. (1)

   A *health fund that has issued an *appropriate private health insurance policy must notify the Medicare Australia CEO, within a period determined by the Medicare Australia CEO, if:

   1. (a)

      an application is given by a person to the fund under section 11‑15 in respect of the policy; or

   2. (b)

      a person who is registered under this Division in respect of the policy becomes eligible to apply for registration under this Division in respect of another appropriate private health insurance policy issued by the fund.

2. (2)

   The notice must be in such form, and contain such details, as the Medicare Australia CEO determines in writing.

3. (3)

   For the purposes of subsection (2), the Medicare Australia CEO must not make a determination requiring the *participating fund to provide:

   1. (a)

      the tax file number of any person; or

   2. (b)

      information about the physical, psychological or emotional health of any person.

4. (4)

   The details determined by the Medicare Australia CEO for the purposes of subsection (2) must not relate to any person other than:

1. 1. (a)

      the applicant; or

   2. (b)

      persons covered by the policy.

2. (5)

   Determinations under subsection (2) are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

11‑25Refusal to register

1. (1)

   If the Medicare Australia CEO refuses to register you in respect of a policy, the Medicare Australia CEO must give to you, and to the *health fund that issued the policy, notice of the refusal together with reasons for the refusal.

2. (2)

   You are taken, for the purposes of this Act, to be registered in respect of the policy if the Medicare Australia CEO does not give notice of refusal within 14 days after receiving the notice under section 11‑20 from the *health fund to which you applied for registration.

   Note: Refusals to register are reviewable under section 19‑10.

11‑30 Notification requirementsregistered person

1. (1)

   If:

   1. (a)

      you are a registered person in respect of an *appropriate private health insurance policy; and

   2. (b)

      a detail:

      1. (i)

         stated in your application under section 11‑15; and

      2. (ii)

         relating to the number of people covered by the policy or to whether any of those people are *dependent children;

   changes in such a way that you ought reasonably to expect that the incentive amount for the policy for a financial year will change;

you must, within 30 days after the change occurs, give notice of the change to the health fund that issued the policy.

1. (2)

   You are guilty of an offence if:

   1. (a)

      you are required by subsection (1) to give a notice to a *health fund if a detail referred to in that subsection changes as mentioned in that subsection; and

   2. (b)

      you fail to comply with the requirement.

   Maximum penalty: 60 penalty units.

   Note: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

2. (3)

   Section 4K of the Crimes Act 1914 does not apply to the obligation to provide information pursuant to subsection (1).

3. (4)

   You must notify the *health fund if you no longer wish to be registered in respect of the policy.

11‑35 Notification requirementshealth funds

A *health fund must notify the Medicare Australia CEO, in a form and within a period determined by the Medicare Australia CEO, of each notice given to the health fund under section 11‑30.

11‑40Revocation of registration

1. (1)

   The Medicare Australia CEO must revoke a person’s registration in respect of an *appropriate private health insurance policy if the Medicare Australia CEO is satisfied that the person is not eligible to participate in the *premiums reduction scheme.

2. (2)

   Revocation of registration under subsection (1) does not affect a person’s right to make another application for registration under section 11‑15.

   Note: Revocations of registration are reviewable under section 19‑10.

3. (3)

   The Medicare Australia CEO must give notice of the revocation of a person’s registration in respect of an *appropriate private health insurance policy to the person, and to the fund that issued the policy, within 28 days after the day on which the revocation occurs.

11‑45Variation of registration

1. (1)

   A *health fund must notify the Medicare Australia CEO if the *type of cover provided by an *appropriate private health insurance policy, issued by the health fund and in respect of which a person is registered, is varied.

2. (2)

   On receiving such a notice, the Medicare Australia CEO must vary the details of the registration accordingly and give notice of the variation to the *health fund.

11‑50Retention of applications by health funds

1. (1)

   A *health fund must retain an application made to it under section 11‑15 for the period of 5 years beginning on the day on which the application was made.

2. (2)

   The *health fund may retain the application in any form (including an electronic form) approved in writing by the Medicare Australia CEO.

3. (3)

   An application retained in such a form must be received in all courts or tribunals as evidence as if it were the original.

Division 12What effect the premiums reduction scheme has on insurance premiums

12‑5Reduction in premiums

1. (1)

   The amount of premium that, apart from this section, would be payable for a financial year under an *appropriate private health insurance policy in respect of which a person is a *participant in the premiums reduction scheme for that year is to be reduced in accordance with this section.

2. (1A)

   The amount by which the premium is to be reduced depends on whether or not a person was registered, or eligible to apply for registration, before 1 January 1999 under the Private Health Insurance Incentives Act 1997 in respect of the policy for the financial year.

3. (1B)

   If the financial year is the financial year that began on 1 July 1998, and no person was so registered or eligible to apply for registration, the amount of the reduction is 30% of the amount of the premium payable under the policy for the financial year.

4. (2)

   If the financial year is the financial year that began on 1 July 1998, and a person was so registered or eligible to apply for registration, the amount of the reduction is the greater of the amount worked out under paragraph (a) and the amount worked out under paragraph (b):

   1. (a)

      30% of:

      1. (i)

         the amount of the premium payable under the policy for the financial year; or

      2. (ii)

         if, because of the operation of the Private Health Insurance Incentives Act 1997, that amount of premium is less than the amount of premium that would otherwise have been payable—the amount of premium that would otherwise have been payable; and

   2. (b)

      the *incentive amount for the policy for the financial year.

5. (2A)

   If the financial year is a later financial year, and no person was so registered or eligible to apply for registration, the amount of the reduction is the sum of the following amounts:

   1. (a)

      30% of the amount of the premium payable under the policy in respect of days in the later financial year on which no person covered by the policy was aged 65 years or over;

   2. (b)

      35% of the amount of the premium payable under the policy in respect of days in the later financial year on which:

      1. (i)

         at least one person covered by the policy was aged 65 years or over; and

      2. (ii)

         no person covered by the policy was aged 70 years or over;

   3. (c)

      40% of the amount of the premium payable under the policy in respect of days in the later financial year on which at least one person covered by the policy was aged 70 years or over.

6. (3)

   If the financial year is a later financial year and a person was so registered or eligible to apply for registration, the amount of the reduction is the greater of:

   1. (a)

      the sum of the amounts referred to in paragraphs (2A)(a), (b) and (c); and

   2. (b)

      the *incentive amount for the policy for the later financial year.

7. (3A)

   If a premium that, apart from this section, would be payable under an *appropriate private health insurance policy in respect of which a person is a *participant in the premiums reduction scheme is payable for part only of a financial year, the amount of the reduction is the amount worked out using the formula:

where:

part of year means the number of days in the part of the financial year.

whole year reduction means the amount that would have been the amount of the reduction if the premium had been payable for the whole of the financial year.

1. (4)

   A reduction is not allowable under this section for an amount of premium payable under a policy if an amount has been received under Chapter 2 in respect of the payment.

2. (5)

   In working out the reduction under this section for an amount of premium payable under a policy, any part of the amount of the premium payable that relates to a period before 1 January 1999 is to be disregarded.

3. (6)

   If, because of the operation of the Private Health Insurance Incentives Act 1997, the amount of a premium payable under a policy for a period after 31 December 1998 is less than the amount that would otherwise have been payable, the amount of the reduction under this section in respect of the premium is reduced by the amount of the difference.

(7)

A reduction is not allowable under this section in respect of a premium if the premium is in respect of a financial year, or part of a financial year, beginning on or after 1 July 2007 .

12‑7Saving provision where a person 65 years or over ceases to be covered by policy

1. (1)

   This section applies to a person (the first person) at a particular time (therelevant time) if:

   1. (a)

      at any time before the relevant time, the first person was covered by an *appropriate private health insurance policy (the original policy), other than as a *dependent child; and

   2. (b)

      at any time when the person was so covered, the amount of the premium reduction under this Chapter was 35% or 40% of the amount of premium payable under the original policy because of the age of another person (the entitling person) covered by the policy; and

   3. (c)

      before the relevant time, the entitling person ceased to be covered by the original policy.

2. (2)

   If, at the relevant time:

   1. (a)

      the first person is covered by an *appropriate private health insurance policy (which may be either the original policy or another policy); and

   2. (b)

      each other person (if any) covered, since the entitling person ceased to be covered by the original policy, by an *appropriate private health insurance policy that also covered the first person:

      1. (i)

         is or was covered as a *dependent child; or

      2. (ii)

         is a person who was covered by the original policy immediately before that cessation;

subsections 12‑5(2A) and (3) are taken to apply (other than for the purposes of working out the *incentive amount) as if the entitling person:

1. (c)

   were covered by the policy mentioned in paragraph (a); and

2. (d)

   were the same age as at that cessation.

1. (3)

   Subsection (2) does not apply if its application would result in the amount of the premium reduction under subsection 12‑5(2A) or (3) being less than it would otherwise have been.

12‑10Participant in the premiums reduction scheme

1. (1)

   A person is a *participant in the premiums reduction scheme for the financial year that began on 1 July 1998 in respect of an *appropriate private health insurance policy if:

   1. (a)

      the person was, immediately before 1 January 1999, registered under Division 4 of the Private Health Insurance Incentives Act 1997 in respect of the policy for the year; or

   2. (b)

      the person is registered under Division 11 in respect of the policy; or

   3. (c)

      the person has applied to be registered under Division 11 in respect of the policy and the registration has not been refused.

2. (2)

   A person is a *participant in the premiums reduction scheme for the financial year beginning on or after 1 July 1999 and before 1 July 2007 in respect of an *appropriate private health insurance policy if:

   1. (a)

      the person is registered under Division 11 in respect of the policy; or

   2. (b)

      the person has applied to be registered under Division 11 in respect of the policy and the registration has not been refused.

Part 6Reimbursement of health fundsDivision 13Introduction

13‑1What this Part is about

This Part is about how health funds participate in the premiums reduction scheme, and how the Commonwealth reimburses them for the reductions in premiums that they make under the scheme.

Table of Divisions in this Part

13 Introduction

14 How health funds become participating funds

15 How participating funds are reimbursed

16 Administrative provisions

Division 14How health funds become participating funds

14‑5Becoming a participating fund

1. (1)

   A *health fund that was, for the financial year that began on 1 July 1998, a participating fund for the purposes of the Private Health Insurance Incentives Act 1997 is taken to be a participating fund for the purposes of this Act.

2. (2)

   A *health fund may apply under section 14‑10 to the Minister to become a participating fund for the purposes of this Act.

3. (3)

   If the Minister approves the application, the *health fund is a participating fund.

14‑10Requirements for applications

1. (1)

   The application must:

   1. (a)

      be in a form approved by the Minister; and

   2. (b)

      include such information as is determined in writing by the Minister; and

   3. (c)

      be signed by the person who is the public officer of the *health fund for the purposes of the National Heath Act 1953; and

   4. (d)

      include an undertaking, signed by the person referred to in paragraph (c), stating that the applicant will participate in the premiums reduction scheme.

2. (1A)

   An undertaking given under paragraph 14‑10(1)(d) of the Private Health Insurance Incentives Act 1998 as in force before the day on which Schedule 3 to the Health Legislation Amendment Act (No. 3) 1999 received the Royal Assent is taken to comply with paragraph (1)(d) of this section even if it is expressed to apply only until the end of a financial year.

14‑15Consideration of applications

1. (1)

   Subject to subsection (2), the Minister must approve the application.

   Note: Rejections of applications are reviewable under section 19‑10.

2. (2)

   The Minister must not approve an application by a *health fund made on or after 1 July 2000 unless the health fund provides its members with a choice of one or more of the following types of policies:

   1. (a)

      a *no gap policy;

   2. (b)

      a *known gap policy.

14‑20Notice of Minister’s decision

1. (1)

   The Minister must notify the applicant, within 28 days after the date of the decision, whether the application has been approved or rejected.

2. (2)

   If the application is rejected, the Minister must cause the Minister’s reasons for rejecting the application to be included in the notice.

   Note: Rejections of applications are reviewable under section 19‑10.

Division 14ARevocation of status of health fund as a participating fund

14A‑1Revocation of status of participating fund

1. (1)

   If a *participating fund:

   1. (a)

      has failed to comply with section 4‑6; or

   2. (b)

      has failed to comply with a condition of participation in the premiums reduction scheme that is prescribed by the regulations; or

   3. (c)

      does not, on and after 1 July 2000, provide its members with a choice of one or more of the following types of policies:

      1. (i)

         a *no gap policy;

      2. (ii)

         a *known gap policy; or

   4. (d)

      refuses or fails to comply with:

      1. (i)

         a direction given by the Minister under Subdivision D of Division 5 of Part VI of the National Health Act 1953; or

      2. (ii)

         a community rating condition set out in section 73AAH, 73AAI or 73AAJ of that Act;

the Minister may, by notice given to the fund, revoke the fund’s status as a participating fund.

1. (2)

   Upon the giving of the notice, the fund ceases to be a participating fund.

Division 15How participating funds are reimbursed

15‑5Health funds may claim reimbursement

1. (1)

   A *health fund may, in accordance with section 15‑10, claim reimbursement from the Medicare Australia CEO for each month during which it is a *participating fund.

2. (2)

   If a *health fund makes a claim that the Medicare Australia CEO decides is correct, the Medicare Australia CEO must pay to the fund, in accordance with section 15‑15, the amount payable under that section in respect of the month to which the claim relates.

(3)

A *health fund may claim reimbursement under this Division only in respect of an amount of premiums that was reduced because of the operation of this Chapter.

15‑10Requirements for claims

1. (1)

   A claim by a *health fund in respect of a month must be made to the Medicare Australia CEO on or before the last day of the *notification period for the following month.

2. (2)

   The claim must be in a form approved by the Medicare Australia CEO and contain such details as the Medicare Australia CEO determines in writing.

3. (3)

   The details may include, but are not limited to, details about any or all of the following *private health insurance policies issued by the *health fund:

   1. (a)

      policies that were, on the first day of the month, policies in respect of which persons were *participants in the premiums reduction scheme;

   2. (b)

      policies that had been, at any time before that day, policies in respect of which persons were *participants in the premiums reduction scheme.

4. (4)

   The Medicare Australia CEO must not make a determination under subsection (2) requiring the *health fund to provide:

   1. (a)

      the *tax file number of any person; or

   2. (b)

      information about the physical, psychological or emotional health of any person.

5. (5)

   Determinations under subsection (2) are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

15‑15Amounts payable to the health fund

1. (1)

   Subject to subsection (2), the amount payable to the *health fund in respect of the month is the sum of the amounts by which premiums in respect of that month under the *appropriate private health insurance policies issued by the health fund were reduced because of the operation of this Chapter.

2. (2)

   The amount must be paid to the *health fund on or before the 15th day of the following month (or, if that day is not a business day, the first business day after that day).

3. (3)

   The amount must be paid in the way determined, in writing, by the Medicare Australia CEO.

15‑20Notifying health funds if amount is not payable

1. (1)

   If the Medicare Australia CEO considers that a claim is incorrect, the Medicare Australia CEO may either refuse the claim or pay only such part of the claim as he or she is satisfied is correct.

2. (1A)

   The Medicare Australia CEO must notify a *health fund if the Medicare Australia CEO makes a decision referred to in subsection (1).

3. (2)

   A notice under subsection (1A) must include reasons for the decision.

4. (3)

   The Medicare Australia CEO is taken, for the purposes of this Act, to have decided that a claim is correct if the Medicare Australia CEO does not give notice of his or her decision that the claim is incorrect on or before the day under subsection 15‑15(2) on or before which, if the claim were correct, it would have been required to have been paid.

15‑21Additional payment if fund claims less than entitlement

1. (1)

   This section applies to a *health fund in respect of a month if:

   1. (a)

      the health fund is a *participating fund in respect of the month; and

   2. (b)

      the health fund made a claim in respect of the month under section 15‑5; and

   3. (c)

      the amount claimed by the health fund was less than the sum of the amounts by which premiums in respect of the month under the appropriate health insurance policies issued by the health fund were reduced because of the operation of this Chapter.

2. (2)

   The *health fund may apply to the Medicare Australia CEO for payment of an amount (the additional amount) not exceeding the difference between:

   1. (a)

      the sum of the amounts by which premiums in respect of the month under the *appropriate health insurance policies issued by the health fund were reduced because of the operation of this Chapter; and

   2. (b)

      the amount already paid to the health fund under section 15‑5 in respect of the month.

3. (3)

   An application under subsection (2) may relate to more than one month.

15‑22Additional payment if fund makes a late claim

1. (1)

   This section applies to a *health fund in respect of a month if:

   1. (a)

      the health fund did not make a claim in respect of the month on or before the last day of the *notification period for the month; and

   2. (b)

      premiums in respect of the month under the *appropriate health insurance policies issued by the health fund were reduced because of the operation of this Chapter.

2. (2)

   The *health fund may apply to the Medicare Australia CEO for payment of an amount (the additional amount) not exceeding the sum of the amounts by which premiums in respect of the month under the *appropriate health insurance policies issued by the health fund were reduced because of the operation of this Chapter.

3. (3)

   An application under subsection (2) may relate to more than one month.

15‑23Contents and timing of application

1. (1)

   An application by a *health fund under section 15‑21 or 15‑22 for payment of an additional amount must contain the following:

   1. (a)

      the name of the health fund;

   2. (b)

      the additional amount sought;

   3. (c)

      the month, or months, in respect of which the additional amount is sought;

   4. (d)

      a certificate in writing signed by a registered company auditor that the additional amount sought is correct;

   5. (e)

      such other details as the Medicare Australia CEO determines in writing.

2. (2)

   The application must be made:

   1. (a)

      if the application relates to only one month—before the earlier of:

      1. (i)

         the day that is 3 years after the last day of the month; and

      2. (ii)

         1 July 2008; and

1. 1. (b)

      if the application relates to more than one month—before the earlier of:

      1. (i)

         the day that is 3 years after the last day of the first of those months; and

      2. (ii)

         1 July 2008.

2. (3)

   An application under section 15‑21 must also contain, in respect of each month to which the application relates, an explanation of why the amount claimed under section 15‑5 was less than the sum of the amounts by which premiums in respect of the month under the *appropriate health insurance policies issued by the *health fund were reduced because of the operation of this Chapter.

3. (4)

   An application under section 15‑22 must also contain, in respect of each month to which the application relates, an explanation of why the *health fund did not make a claim on or before the last day of the *notification period for the month.

15‑24Decision on application

1. (1)

   If a *health fund makes an application under section 15‑21 or 15‑22 for payment of an additional amount, the Medicare Australia CEO must pay the additional amount sought if the Medicare Australia CEO is satisfied:

   1. (a)

      that the additional amount sought is correct; and

   2. (b)

      that it would be reasonable to grant the application, having regard to the explanation mentioned in subsection 15‑23(3) or (4).

2. (2)

   The Medicare Australia CEO may refuse the application, or decide to pay only part of the additional amount sought, if the Medicare Australia CEO is satisfied:

   1. (a)

      that the additional amount sought is incorrect; or

   2. (b)

      that it would not be reasonable to grant the application, having regard to the explanation mentioned in subsection 15‑23(3) or (4).

3. (3)

   The Medicare Australia CEO must notify the *health fund of the Medicare Australia CEO’s decision on the application.

4. (4)

   A notice under subsection (3) must include reasons for the decision.

5. (5)

   The Medicare Australia CEO is taken, for the purposes of this Act, to have decided that:

   1. (a)

      the additional amount sought is correct; and

   2. (b)

      that it would be reasonable to grant the application;

if the Medicare Australia CEO does not give notice of his or her decision that the additional amount sought is incorrect, or that it would not be reasonable to grant the application, within the period of 3 months after the application was received by the Medicare Australia CEO.

1. (6)

   If the Medicare Australia CEO is taken to have made a decision under subsection (5) in respect of a *health fund, the Medicare Australia CEO is taken to have given notice of that decision to the health fund.

15‑25Reconsideration of decisions

1. (1)

   A *health fund that has been given a notice under subsection 15‑20(1A) or 15‑24(3) may request the Medicare Australia CEO to reconsider the decision.

2. (2)

   The request must:

   1. (b)

      set out the reasons for the request; and

   2. (c)

      be made on or before the first day of the month following the month during which the Medicare Australia CEO gave the notice (or, if that day is not a business day, the first business day after that day).

3. (3)

   As soon as practicable after receiving the request, the Medicare Australia CEO must reconsider the decision and:

   1. (a)

      affirm it; or

   2. (b)

      vary it; or

   3. (c)

      revoke it and make a fresh decision.

   Note: Decisions on reconsideration are reviewable under section 19‑10.

4. (4)

   If the Medicare Australia CEO varies the decision or revokes the decision and makes a fresh decision, the decision as varied, or the fresh decision, as the case may be, has effect according to its terms and is taken always to have had that effect from the time when the original decision was made.

5. (6)

   The Medicare Australia CEO must notify the *health fund stating the Medicare Australia CEO’s decision on the reconsideration together with a statement of his or her reasons for the decision.

6. (7)

   The Medicare Australia CEO is taken, for the purposes of this Act, to have revoked the decision if the Medicare Australia CEO does not notify the *health fund of his or her decision on the reconsideration within 28 days after receiving the request.

Division 16Administrative provisions

16‑5Audits by Medicare Australia CEO

1. (1)

   The Medicare Australia CEO may, at any time, audit the accounts and records of a *health fund that is, or has been, a *participating fund.

2. (2)

   An audit under subsection (1) must relate only to the accounts and records of the *health fund to the extent that they deal with:

   1. (a)

      participation by persons in the *premiums reduction scheme; or

   2. (b)

      reductions of premium payable under *appropriate private health insurance policies under the premiums reduction scheme; or

   3. (c)

      receipt of money from the Medicare Australia CEO under this Part.

3. (3)

   The Medicare Australia CEO must not carry out an audit unless he or she has given notice to the *health fund concerned stating that an audit is to be carried out.

4. (4)

   The *health fund must ensure that the Medicare Australia CEO has full and free access to all accounts, records, documents and papers of the health fund that are relevant to the audit.

5. (5)

   The person carrying out the audit may make copies of, or take extracts from, such accounts, records, documents or papers for use in the audit.

6. (6)

   In considering whether or not to conduct an audit under this section, the Medicare Australia CEO may take into account a report under section 82PA of the National Health Act 1953.

7. (7)

   Without limiting the powers of the Medicare Australia CEO under the preceding provisions of this section, the Medicare Australia CEO may, by notice given to a *health fund, require the fund to give to the Medicare Australia CEO, within a period specified in the notice beginning at the end of a financial year, a certificate in writing by a registered company auditor as to the correctness of the accounts and records of the fund for that year to the extent that those accounts and records deal with matters mentioned in paragraphs (2)(a), (b) and (c).

16‑10Medicare Australia CEO may require production of applications

1. (1)

   The Medicare Australia CEO may, by notice given to a *health fund, require the health fund:

   1. (a)

      to produce to the Medicare Australia CEO, within the period and in the manner specified in the notice, applications retained under section 11‑50; or

   2. (b)

      to make copies of any such applications and give them to the Medicare Australia CEO within the period and in the manner specified in the notice.

2. (2)

   A period specified under subsection (1) must not be less than one month.

3. (3)

   A *health fund is entitled to be paid by the Medicare Australia CEO reasonable compensation for complying with paragraph (1)(b).

Chapter 4Provisions applying both to incentive payments scheme and to premiums reduction schemePart 7GeneralDivision 17Introduction

17‑1What this Part is about

This Part contains general provisions that relate to both Chapters 2 and 3.

Table of Divisions in this Part

17 Introduction

18 When and how payments can be recovered

19 Miscellaneous

Division 18When and how payments can be recovered

18‑5Recovery of payments

1. (1)

   The following amounts are recoverable as debts due to the Commonwealth:

   1. (a)

      a payment made to a person under Part 3 to which the person was not entitled;

   2. (b)

      a payment made to a person under Part 3 in respect of a premium that was afterwards refunded;

   3. (ba)

      a payment made to a person under Part 3 in respect of a claim that has been withdrawn under section 6‑15;

   4. (c)

      so much of a payment made under section 15‑5 or 15‑24 as relates to an *appropriate private health insurance policy that covers a person who was:

      1. (i)

         a *participant in the premiums reduction scheme for the financial year concerned in respect of the policy; and

      2. (ii)

         not eligible to participate in that scheme in respect of that policy;

   5. (ca)

      so much of a payment made under section 15‑5 or 15‑24 as relates to a premium for which a reduction was not allowable under section 12‑5;

   6. (d)

      150% of so much of a payment made under section 15‑5 or 15‑24 as:

      1. (i)

         is not reflected in reductions in premiums payable under *appropriate private health insurance policies issued by the *health fund concerned; or

      2. (ii)

         relates to a person whose application under section 11‑15 has not been retained by the health fund as required by section 11‑50; or

      3. (iii)

         relates to a person whose application under section 11‑15 has been so retained, but has not been produced to the Medicare Australia CEO by the health fund in accordance with a requirement made by the Medicare Australia CEO under section 16‑10;

   7. (e)

      so much of a payment purportedly made under section 15‑5 or 15‑24 as was not payable under that section;

   8. (f)

      interest payable under subsection 18‑10(2).

2. (2)

   The amounts are recoverable from:

   1. (a)

      if paragraph (1)(a), (b) or (ba) applies—the person referred to in that paragraph or that person’s estate; or

   2. (b)

      if paragraph (1)(c), (ca), (d) or (e) applies—the *health fund to which the payment concerned was made; or

   3. (c)

      if paragraph (1)(f) applies:

      1. (i)

         if the payment was made to a health fund—that fund; or

      2. (ii)

         if the payment was made to an individual—the individual or his or her estate.

3. (3)

   An amount recoverable under subsection (1) is recoverable whether or not any person has been convicted of an offence relating to the payment.

18‑10Interest on amounts recoverable

1. (1)

   If the Medicare Australia CEO has served on an individual from whom an amount is recoverable or the legal personal representative of such an individual, or on a *health fund from which an amount is recoverable, under subsection 18‑5(1) a notice claiming an amount as a debt due to the Commonwealth and:

   1. (a)

      an arrangement for the repayment of the amount has been entered into between the Medicare Australia CEO and the individual or the individual’s legal personal representative, or the health fund, as the case may be, within the period referred to in subsection (3), and there has been a default in payment of an amount required to be paid under the arrangement; or

   2. (b)

      at the end of the period such an arrangement has not been entered into and all or part of the amount remains unpaid;

then, from and including the day after the end of the period, interest becomes payable on so much of the amount as from time to time remains unpaid.

1. (2)

   Interest is payable:

   1. (a)

      at the rate specified in the regulations; or

   2. (b)

      if no rate is so specified—at the rate of 15% per annum.

2. (3)

   The period for entering into an arrangement under paragraph (1)(a) is the period of 3 months following the service of the notice under subsection (1), or such longer period as the Medicare Australia CEO allows.

3. (4)

   Despite subsection (1), in any proceedings instituted by the Commonwealth for the recovery of an amount due under paragraph 18‑5(1)(f), the court may order that the interest payable under that paragraph is, and is taken to have been, so payable from and including a day later than the day referred to in subsection (1).

18‑15Write off, waiver and payment by instalments

1. (1)

   The Medicare Australia CEO may, on behalf of the Commonwealth, make a written determination:

   1. (a)

      writing off an amount that a person or *health fund is required to pay to the Commonwealth under section 18‑5; or

   2. (b)

      waiving the right of the Commonwealth to recover from a person or health fund the whole or a part of an amount that the person or fund is required to pay to the Commonwealth under that section; or

   3. (c)

      allowing a person who, or health fund which, is required to pay an amount to the Commonwealth under that section to pay that amount by such instalments as are specified in the determination.

2. (1A)

   Without limiting subsection (1), the Medicare Australia CEO may make a determination under paragraph (1)(b) if the Medicare Australia CEO is of the opinion that information given by or on behalf of:

   1. (a)

      the Commonwealth; or

   2. (b)

      a *health fund;

to a person from whom an amount is recoverable about that person’s entitlements under this Act was incorrect or misleading in a material particular.

1. (2)

   A determination under subsection (1) takes effect according to its terms:

   1. (a)

      on the day specified in the determination, being the day on which the determination is made or any day before or after that day; or

   2. (b)

      if no day is so specified—on the day on which the determination is made.

2. (3)

   If a determination is made under subsection (1) in relation to a person or *health fund, the Medicare Australia CEO must cause notice of the determination to be served on the person or fund.

   Note: Decisions not to make determinations under this section are reviewable under section 19‑10.

18‑20Medicare Australia CEO may set off debts against amounts payable

1. (1)

   Despite any other provision of this Act, if:

   1. (a)

      except for this section, an amount would be payable by the Medicare Australia CEO to a person or his or her estate, or to a *health fund, under this Act; and

   2. (b)

      an amount is recoverable under section 18‑5 by the Commonwealth from the person or his or her estate, or from the fund, as the case may be;

the Medicare Australia CEO may set off the whole or a part of the amount referred to in paragraph (b) against the amount referred to in paragraph (a).

1. (2)

   If the Medicare Australia CEO decides to make such a set‑off in respect of a person or his or her estate, the Medicare Australia CEO must serve on the person or his or her legal personal representative or the legal personal representative of his or her estate a notice of the decision.

2. (3)

   If the Medicare Australia CEO makes such a set‑off:

   1. (a)

      the Medicare Australia CEO is liable to pay to the person or his or her estate, or to the fund, only the amount remaining after the set‑off; and

   2. (b)

      the amount referred to in paragraph (1)(b) is reduced by the amount set off.

18‑25Reconsideration of certain decisions under this Division

1. (1)

   You may apply to the Medicare Australia CEO for the Medicare Australia CEO to reconsider the following decisions:

   1. (a)

      a decision that an amount is recoverable as a debt due to the Commonwealth under:

      1. (i)

         paragraph 18‑5(1)(a) or (b); or

      2. (ii)

         paragraph 18‑5(1)(f) in respect of a payment made to an individual; or

   2. (b)

      a decision under subsection 18‑20(1) to set off a debt against an amount otherwise payable to a person or his or her estate.

2. (2)

   The application must:

   1. (a)

      be in writing; and

   2. (b)

      set out the reasons for the application.

3. (3)

   The application must be made within:

   1. (a)

      28 days after the day on which you are notified of the decision; or

   2. (b)

      if, either before or after the end of that period of 28 days, the Medicare Australia CEO extends the period within which the application may be made—the extended period for making the application.

4. (4)

   Upon receiving such an application, the Medicare Australia CEO must:

   1. (a)

      reconsider the decision; and

   2. (b)

      either affirm or revoke the decision.

5. (5)

   If the Medicare Australia CEO revokes the decision, the revocation is taken to be a decision:

   1. (a)

      in the case of a decision mentioned in paragraph (1)(a)—to waive the debt; or

   2. (b)

      in the case of a decision mentioned in paragraph (1)(b)—not to set off a debt against an otherwise payable amount.

6. (6)

   The Medicare Australia CEO must give you a notice stating his or her decision on the reconsideration together with a statement of his or her reasons for the decision.

7. (7)

   The Medicare Australia CEO must make his or her decision on reconsideration of a decision within 28 days after the day on which he or she received an application for reconsideration.

8. (8)

   The Medicare Australia CEO is taken, for the purposes of this Division, to have made a decision confirming the original decision if the Medicare Australia CEO has not told the applicant of his or her decision on the reconsideration before the end of the period of 28 days.

Division 19Miscellaneous19‑1 Notification requirementshealth funds

1. (1)

   The Medicare Australia CEO may, by notice given to a *health fund, require the fund to provide information specified in the notice about a person who:

   1. (a)

      is covered at any time during a financial year specified in the notice by an *appropriate private health insurance policy issued by the fund; or

   2. (b)

      paid premiums under such a policy.

2. (2)

   The information that the Medicare Australia CEO may require the *health fund to provide is information relating to any of the following:

   1. (a)

      the name, residential address and date of birth of each such person;

   2. (b)

      the fund membership number of the policy;

   3. (c)

      the name, residential address and date of birth of the person covered by the policy whom the health fund treats as the contributor in respect of the policy;

   4. (d)

      the name, residential address and date of birth of any person who is a *partner of a person covered by the policy;

   5. (e)

      whether the policy provides *hospital cover, *ancillary cover or *combined cover;

   6. (f)

      the date on which the policy was issued;

   7. (g)

      whether the policy has terminated or been suspended, and, if it has, the date on which it terminated or was suspended;

   8. (h)

      the amount of the premium under the policy;

   9. (i)

      the period to which the premium relates;

   10. (j)

       any increase or decrease in the premium;

   11. (k)

       whether a payment in respect of a premium that was due within a period specified by the Medicare Australia CEO was not paid;

   12. (l)

       any other information relevant to the operation of Chapter 2 or 3 that is determined in writing by the Medicare Australia CEO.

3. (3)

   For the purposes of paragraph (2)(l), the Medicare Australia CEO must not make a determination requiring the *health fund to provide:

   1. (a)

      the *tax file number of any person; or

   2. (b)

      information about the physical, psychological or emotional health of any person.

4. (4)

   Determinations under paragraph (2)(l) are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

5. (5)

   The information required by a notice under subsection (1) is to be provided:

   1. (a)

      in a form (including an electronic form) approved by the Medicare Australia CEO; and

   2. (b)

      within the period specified in the notice.

6. (6)

   A *health fund is guilty of an offence if:

   1. (a)

      the fund is required by a notice under subsection (1) to provide information within a specified period about a person or matter; and

   2. (b)

      the fund fails to comply with the requirement.

   Maximum penalty: 20 penalty units.

   Note 1: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

   Note 2: The obligation to provide information pursuant to a notice under subsection (1) is a continuing obligation and a health fund is guilty of an offence for each day, after the period specified in the notice, until the information is provided (see section 4K of the Crimes Act 1914).

19‑2Form of notices

1. (1)

   A notice under this Act by the Minister or the Medicare Australia CEO to a *health fund or a notice, request or application by a health fund to the Minister or the Medicare Australia CEO may be given, served or made in writing or in an electronic form.

2. (2)

   A notice under this Act by the Medicare Australia CEO to a person other than a *health fund or a notice, request or application by a person other than a health fund to the Medicare Australia CEO must be in writing.

19‑3Use of information to determine whether persons covered by private health insurance policies are eligible for medicare benefits

In determining for the purposes of this Act whether a person covered by a *private health insurance policy is an eligible person within the meaning of section 3 of the Health Insurance Act 1973, or is treated as such a person because of section 6 or 7 of that Act, the Medicare Australia CEO may use any information that he or she has obtained under that Act in determining whether the person was eligible to receive medicare benefits.

19‑5Use etc. of information relating to another person

A person is guilty of an offence if:

1. (a)

   the person uses, makes a record of, or discloses or communicates to any person, any information that relates to the affairs of another person and was acquired under or for the purposes of this Act; and

2. (b)

   the use, making of the record, disclosure or communication was not carried out in the performance of a function or obligation, or the exercise of a power, under this Act.

Maximum penalty: Imprisonment for 2 years.

Note: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

19‑6Principles relating to personal information

1. (1)

   The Minister may, in writing, make principles relating to:

   1. (a)

      the acquiring of personal information under or for the purposes of this Act; and

1. 1. (b)

      the storage of, security of, access to, correction of, use of and disclosure of such personal information.

2. (2)

   A *health fund must comply with the principles.

3. (3)

   The principles are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

4. (4)

   In this section:

personal information has the same meaning as in the Privacy Act 1988.

19‑10Review by Administrative Appeals Tribunal

Application may be made to the Administrative Appeals Tribunal for review of the following decisions:

1. (a)

   a decision by the Medicare Australia CEO under section 6‑30 confirming a decision under section 6‑20 refusing a claim;

2. (b)

   a decision by the Medicare Australia CEO refusing to register a person under section 11‑25 in respect of an *appropriate private health insurance policy;

3. (c)

   a decision by the Medicare Australia CEO under subsection 11‑40(1) to revoke a person’s registration in respect of an appropriate private health insurance policy (other than a decision made as a result of a notice given by the person under subsection 11‑30(4));

4. (d)

   a decision by the Minister under section 14‑15 to reject an application by a *health fund to become a *participating fund;

5. (da)

   a decision by the Minister under section 14A to revoke a health fund’s status as a participating fund;

6. (e)

   a decision by the Medicare Australia CEO under subsection 15‑25(3) on reconsideration of a decision that a claim under section 15‑10, or an additional amount sought under section 15‑21 or 15‑22, is incorrect;

7. (f)

   a decision by the Medicare Australia CEO not to make a determination under section 18‑15 in relation to an amount;

8. (g)

   a decision by the Medicare Australia CEO under section 18‑25 on reconsideration of a decision:

   1. (i)

      that an amount is recoverable as a debt due to the Commonwealth under:

      1. (A)

         paragraph 18‑5(1)(a) or (b); or

      2. (B)

         paragraph 18‑5(1)(f) in respect of a payment made to an individual; or

   2. (ii)

      under subsection 18‑20(1) to set off a debt against an amount otherwise payable to a person or his or her estate.

Note: Under section 27A of the Administrative Appeals Tribunal Act 1975, the decision‑maker must notify persons whose interests are affected by the making of the decision and of their right to have the decision reviewed. In notifying any such persons, the decision‑maker must have regard to the Code of Practice determined under section 27B of that Act.

19‑15Information to be provided to the Commissioner

1. (1)

   The Medicare Australia CEO must, within 120 days after the end of each financial year, give the following information to the Commissioner:

   1. (a)

      the name, date of birth and residential address of each person who:

      1. (i)

         paid a premium under an *appropriate private health insurance policy for that financial year; or

      2. (ii)

         received a payment under Chapter 2 in respect of such a premium; or

      3. (iii)

         was a *participant in the premiums reduction scheme in respect of an appropriate private health insurance policy for that financial year;

   2. (b)

      the name of the *health fund that issued the policy;

   3. (ba)

      the fund membership number of the policy;

   4. (bb)

      the identification code of the fund that issued the policy;

   5. (bc)

      the type of membership provided by the fund in respect of the policy;

   6. (bd)

      whether the policy has been terminated or is suspended;

   7. (be)

      if the policy has been terminated or is suspended, the date of the termination or suspension;

   8. (c)

      the *type of cover provided by the policy;

   9. (d)

      the total amount of payments to a health fund in respect of the policy;

   10. (e)

       the period in respect of which those payments were made;

   11. (f)

       the name and date of birth of any other person covered by the policy in respect of which those payments were made;

   12. (g)

       whether any person covered by the policy was a *dependent child at any time during that financial year;

   13. (h)

       the total amounts paid by the Medicare Australia CEO under Chapters 2 and 3 for the financial year;

   14. (i)

       any other information that the Commissioner determines in writing.

2. (2)

   For the purposes of paragraph (1)(i), the *Commissioner must not make a determination requiring the Medicare Australia CEO to provide:

   1. (a)

      the *tax file number of any person; or

   2. (b)

      information about the physical, psychological or emotional health of any person.

3. (3)

   Determinations under paragraph (1)(i) are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

19‑16Delegation

1. (1)

   The Minister may, by writing, delegate all or any of his or her powers under this Act to:

   1. (a)

      the Secretary to the Department; or

   2. (b)

      the Medicare Australia CEO; or

   3. (c)

      an officer of, or person employed in, the Department; or

   4. (d)

      an employee of Medicare Australia .

2. (2)

   The Medicare Australia CEO may, by writing, delegate all or any of his or her powers under this Act to an employee of Medicare Australia .

19‑20Exclusion of certain State insurance

This Act does not apply with respect to State insurance that does not extend beyond the limits of the State concerned.

19‑25False or misleading information

A person is guilty of an offence if the person gives to the Medicare Australia CEO or to a *health fund under this Act any information that the person knows to be false or misleading in a material particular.

Maximum penalty: Imprisonment for 12 months.

Note: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

19‑30Application of the Criminal Code

Chapter 2 of the Criminal Code applies to all offences under this Act.

19‑35Appropriation

The Consolidated Revenue Fund is appropriated for the purpose of making payments under this Act.

19‑40Regulations

The Governor‑General may make regulations prescribing matters:

1. (a)

   required or permitted by this Act to be prescribed; or

2. (b)

   necessary or convenient to be prescribed for carrying out or giving effect to this Act.

Part 8Dictionary of defined expressionsDivision 20Defined expressions

20‑5Definitions

In this Act, unless the contrary intention appears:

ancillary cover: a *private health insurance policy provides ancillary cover if people covered by the policy are covered (wholly or partly) for liability to pay fees and charges for ancillary health benefits within the meaning of section 67 of the National Health Act 1953.

appropriate private health insurance policy means a *private health insurance policy that satisfies the following conditions:

1. (a)

   it provides *hospital cover, *ancillary cover or *combined cover;

2. (b)

   the person, or each of the persons, covered by it is an eligible person within the meaning of section 3 of the Health Insurance Act 1973, or is treated as such a person because of section 6 or 7 of that Act.

business day means a day other than a Saturday, a Sunday or a public holiday in the place concerned.

combined cover: a *private health insurance policy provides combined cover if it provides both *hospital cover and *ancillary cover.

Commissioner means the Commissioner of Taxation.

dependent child, in relation to an *appropriate private health insurance policy, means a person:

1. (a)

   who is covered by the policy; and

2. (b)

   whom the *health fund that issued the policy accepts as a dependent child for the purposes of the policy;

but does not include:

1. (c)

   a person who is the *partner of another person; or

2. (d)

   a person (other than a full‑time student) who is 18 years of age or older; or

3. (e)

   a full‑time student who is 25 years of age or older.

employee of Medicare Australia means an employee within the meaning of the Medicare Australia Act 1973.

fringe benefit means:

1. (a)

   a fringe benefit as defined by subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986; and

2. (b)

   a benefit that would be a fringe benefit (as defined by subsection 136(1) of that Act) if paragraphs (d) and (e) of the definition of employer in that subsection of that Act were omitted.

health fund means a registered organisation within the meaning of Part VI of the National Health Act 1953.

hospital cover: a *private health insurance policy provides hospital cover if it is an applicable benefits arrangement, within the meaning of section 5A of the National Health Act 1953, to which paragraph 5A(1)(a) of that Act applies.

hospital treatment has the meaning given by section 3 of the Health Insurance Act 1973.

incentive amount has the meaning given by section 20‑10.

incentive payments scheme means the scheme provided for by Chapter 2.

known gap policy means a private health insurance policy that covers all but a specified amount or percentage of the full cost of hospital treatment and associated professional attention for the person or persons insured.

Medicare Australia CEO means the Chief Executive Officer of Medicare Australia .

no gap policy means a private health insurance policy that covers the full cost of hospital treatment and associated professional attention for the person or persons insured.

notification period, in relation to a month, means the period starting on the first day of the month and finishing on the seventh day of the month.

parent of a dependent child means:

1. (a)

   unless the dependent child is a full‑time student who is 18 years of age or older—a person who has the right (whether alone or jointly with another person):

   1. (i)

      to have the daily care and control of the child; and

   2. (ii)

      to make decisions about the daily care and control of the child; or

2. (b)

   if the dependent child is a full‑time student who is 18 years of age or older—a person who is primarily responsible (whether alone or jointly with another person) for the maintenance and support of the student.

participant in the premiums reduction scheme has the meaning given by section 12‑10.

participating fund means a *health fund referred to in subsection 14‑5(1) or (3) other than such a fund whose status as a participating fund has been revoked under subsection 14A‑1(1).

partner, in relation to another person, means:

1. (a)

   a person who is legally married to the other person and is not living separately and apart from the other person on a permanent basis; or

2. (b)

   a person who, although not legally married to the other person, lives with the other person on a bona fide domestic basis as the husband or wife of the other person.

pay a premium includes make a payment in respect of a premium.

premiums reduction scheme means the scheme provided for by Chapter 3.

private health insurance policy means a contract of insurance that was entered into by a *health fund in the course of carrying on a health insurance business within the meaning of section 67 of the National Health Act 1953.

professional attention has the meaning given by section 3 of the Health Insurance Act 1973.

tax file number means a tax file number as defined in section 202A of the Income Tax Assessment Act 1936.

type of cover, in relation to a private health insurance policy, means:

1. (a)

   *hospital cover; or

2. (b)

   *ancillary cover; or

3. (c)

   *combined cover.

you: see subsection 1‑15(5).

20‑10Meaning of incentive amount

1. (1)

   For the purposes of this Act, the incentive amount for an *appropriate private health insurance policy for a financial year is worked out in accordance with the following table:

Incentive amounts
Item	Number and kinds of people covered by the policy	Policy provides *hospital cover but not *ancillary cover	Policy provides *ancillary cover but not *hospital cover	Policy provides *combined cover
1	3 or more people	$350	$100	$450
2	One dependent child and one other person	$350	$100	$450
3	2 people neither of whom is a dependent child	$200	$50	$250
4	One person	$100	$25	$125

1. (2)

   If the amount of the premium paid by a person, or by a person’s employer as a *fringe benefit for the person, under the *appropriate private health insurance policy is for part only of the financial year, the incentive amount is worked out using the following formula:

Notes to thePrivate Health Insurance Incentives Act 1998

Note 1

The Private Health Insurance Incentives Act 1998 as shown in this compilation comprises Act No. 121, 1998 amended as indicated in the Tables below.

For application, saving or transitional provisions made by the Private Health Insurance (Transitional Provisions and Consequential Amendments) Act 2007, see Act No. 32, 2007.

For all relevant information pertaining to application, saving or transitional provisions see Table A.

Table of Acts

Act	Number and year	Date of Assent	Date of commencement	Application, saving or transitional provisions
Private Health Insurance Incentives Act 1998	121, 1998	15 Dec 1998	15 Dec 1998
Health Legislation Amendment Act (No. 3) 1999	159, 1999	8 Dec 1999	Schedule 3 (items 1–69): 1 Jan 1999 (a)	—
Health Legislation Amendment Act (No. 2) 2001	59, 2001	28 June 2001	Schedule 3 (items 7–10): 15 Dec 1998 (see s. 2(2)) Schedule 3 (item 12): 1 Jan 1999 Remainder: Royal Assent	Sch. 3 (items 5, 11)
Health Legislation Amendment (Private Health Insurance Reform) Act 2004	1, 2004	27 Feb 2004	Schedule 1 (item 40): 1 July 2004	—
Private Health Insurance Incentives Amendment Act 2005	9, 2005	22 Feb 2005	22 Feb 2005	Sch. 1 (item 7)
Human Services Legislation Amendment Act 2005	111, 2005	6 Sept 2005	Schedule 2 (items 607–709): 1 Oct 2005	—
Health Legislation Amendment (Private Health Insurance) Act 2006	83, 2006	30 June 2006	Schedule 2 (items 1, 2): 1 July 2006	Sch. 2 (item 2)
Private Health Insurance (Transitional Provisions and Consequential Amendments) Act 2007	32, 2007	30 Mar 2007	Schedule 1 (item 62): 1 July 2008 Schedule 3 (items 10–16): 1 Apr 2007 (see s. 2(1))	[see Note 1]

(a) The Private Health Insurance Incentives Act 1998 was amended by Schedule 3 (items 1–69) only of the Health Legislation Amendment Act (No. 3) 1999, subsection 2(5) of which provides as follows:

1. (5)

   Schedule 3 is taken to have commenced on 1 January 1999.

Table of Amendments

ad. = added or inserted am. = amended rep. = repealed rs. = repealed and substituted
Provision affected	How affected
Part 1
Division 1
Note to s. 1-15(2)..................	am. No. 111, 2005
Chapter 2
Part 2
Division 4
S. 4‑5.....................................	am. No. 159, 1999; No. 32, 2007
S. 4‑6.....................................	ad. No. 159, 1999
am. No. 111, 2005
S. 4‑10...................................	am. No. 9, 2005
S. 4‑12...................................	ad. No. 9, 2005
Part 3
Division 6
S. 6‑10...................................	am. No. 111, 2005
S. 6‑15...................................	am. No. 111, 2005
S. 6‑20...................................	am. No. 159, 1999; No. 111, 2005
S. 6‑25...................................	ad. No. 159, 1999
am. No. 111, 2005
S. 6‑30...................................	ad. No. 159, 1999
am. No. 111, 2005
S. 6‑35...................................	ad. No. 159, 1999
rs. No. 111, 2005
Part 4
Division 7
S. 7‑1.....................................	am. No. 111, 2005
Division 8
S. 8‑5.....................................	am. No. 159, 1999; No. 111, 2005
S. 8‑10...................................	rep. No. 159, 1999
Chapter 3
Part 5
Division 10
S. 10‑5...................................	am. No. 159, 1999
Division 11
Heading to s. 11-5.................	am. No. 111, 2005
S. 11‑5...................................	am. No. 159, 1999; No. 111, 2005
S. 11‑10.................................	rs. No. 159, 1999
am. No. 32, 2007
S. 11‑15.................................	am. No. 159, 1999
Heading to s. 11-20...............	am. No. 111, 2005
S. 11‑20.................................	am. No. 159, 1999; No. 111, 2005
S. 11‑25.................................	am. No. 159, 1999; No. 59, 2001; No. 111, 2005
S. 11‑30.................................	am. No. 159, 1999
S. 11‑35.................................	am. No. 111, 2005
S. 11‑40.................................	am. No. 159, 1999; No. 111, 2005
S. 11‑45.................................	am. No. 111, 2005
S. 11‑50.................................	am. No. 111, 2005
Division 12
S. 12‑5...................................	am. No. 159, 1999; No. 59, 2001; No. 9, 2005; No. 32, 2007
S. 12‑7...................................	ad. No. 9, 2005
S. 12‑10.................................	rs. No. 159, 1999
am. No. 32, 2007
Division 14
S. 14‑5...................................	am. No. 159, 1999
S. 14‑10.................................	am. No. 159, 1999
S. 14‑15.................................	am. No. 159, 1999
S. 14‑20.................................	am. No. 159, 1999
Division 14A
Div. 14A of Part 6..................	ad. No. 159, 1999
S. 14A‑1................................	ad. No. 159, 1999
am. No. 1, 2004
Division 15
S. 15‑5...................................	am. No. 159, 1999; No. 59, 2001; No. 111, 2005; No. 32, 2007
S. 15‑10.................................	am. No. 111, 2005
S. 15‑15.................................	am. No. 111, 2005
S. 15‑20.................................	am. No. 159, 1999; No. 111, 2005
S. 15‑21.................................	ad. No. 59, 2001
am. No. 111, 2005
S. 15‑22.................................	ad. No. 59, 2001
S. 15‑23.................................	ad. No. 59, 2001
am. No. 111, 2005; No. 32, 2007
S. 15‑24.................................	ad. No. 59, 2001
am. No. 111, 2005
S. 15‑25.................................	am. No. 159, 1999; No. 59, 2001; No. 111, 2005
Division 16
Heading to s. 16-5.................	am. No. 111, 2005
S. 16‑5...................................	am. No. 159, 1999; No. 111, 2005
Heading to s. 16-10...............	am. No. 111, 2005
S. 16‑10.................................	am. No. 159, 1999; No. 111, 2005
Chapter 4
Part 7
Division 18
S. 18‑5...................................	am. No. 159, 1999; No. 59, 2001; No. 111, 2005
S. 18‑10.................................	am. No. 111, 2005
S. 18‑15.................................	am. No. 159, 1999; No. 111, 2005
Heading to s. 18-20...............	am. No. 111, 2005
S. 18‑20.................................	ad. No. 159, 1999
am. No. 111, 2005
S. 18‑25.................................	ad. No. 159, 1999
am. No. 111, 2005
Division 19
S. 19-1...................................	ad. No. 159, 1999
am. No. 111, 2005
S. 19-2...................................	ad. No. 159, 1999
am. No. 111, 2005
S. 19-3...................................	ad. No. 159, 1999
am. No. 111, 2005
S. 19‑6...................................	ad. No. 159, 1999
S. 19‑10.................................	am. No. 159, 1999; No. 59, 2001; No. 111, 2005
S. 19‑15.................................	am. No. 159, 1999; No. 111, 2005; No. 83, 2006
S. 19‑16.................................	ad. No. 159, 1999
am. No. 111, 2005
S. 19‑25.................................	am. No. 111, 2005
Part 8
Division 20
S. 20‑5...................................	am. No. 159, 1999; No. 111, 2005

Table A

Application, saving or transitional provisions

Health Legislation Amendment Act (No. 2) 2001 (No. 59, 2001)

Schedule 3

5

Application

A *health fund may make an application under section 15‑21 or 15‑22 of the Private Health Insurance Incentives Act 1998, as amended by this Part, in respect of a month occurring before or after the commencement of this item.

11

Transitional provision

If:

1. (a)

   before the commencement day, a *health fund reduced premiums in respect of a month in accordance with section 12‑5 of the Private Health Insurance Incentives Act 1998; and

2. (b)

   the fund made a claim under section 15‑10 in relation to the month within the period specified in that section;

the amendments made by this Schedule are taken not to affect the amount paid, or payable, to the fund in respect of the month.

Private Health Insurance Incentives Amendment Act 2005 (No. 9, 2005)

Schedule 1

7

Application of amendments

The amendments made by this Schedule apply to amounts of premium, and amounts in respect of premium, paid or payable in respect of a period beginning on or after 1 April 2005.

Health Legislation Amendment (Private Health Insurance) Act 2006

(No. 83, 2006)

Schedule 2

2

Application of amendment

The amendment made by this Schedule applies in relation to the 2005‑2006 financial year and later financial years.