EXPLANATORY STATEMENT
Select Legislative Instrument 2006 No. 223
Minute No. 20 of 2006 – Minister for Health and Ageing
Subject: Health Insurance Act 1973
Health Insurance (Diagnostic Imaging Services Table) Amendment Regulations 2006 (No. 3)
Subsection 133(1) of the Health Insurance Act 1973 (the Act) provides that the
Governor-General may make regulations, not inconsistent with the Act, prescribing all matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.
The Act provides, in part, for payments of Medicare benefits in respect of professional services rendered to eligible persons. Section 9 of the Act provides that Medicare benefits shall be calculated by reference to the fees for medical services, including diagnostic imaging services, set out in prescribed tables.
Subsection 4AA(1) of the Act provides that the regulations may prescribe a table of diagnostic imaging services, the amount of fees applicable in respect of each item and the rules for interpretation of the table. Schedule 1 to the Health Insurance (Diagnostic Imaging Services Table) Regulations 2005 (the Principal Regulations) prescribes such a table.
The purpose of the Regulations is to amend the fee for cardiac ultrasound items 55113, 55114 and 55115 by applying a two percent reduction.
Medicare funding for diagnostic imaging services specified in the table is managed between the Australian Government (as represented by the Department of Health and Ageing) and relevant bodies representing the diagnostic imaging professions. This is facilitated through four Quality and Outlays Memoranda of Understanding (MoUs) covering radiology, cardiac imaging, nuclear medicine imaging and obstetric and gynaecological ultrasound.
The Regulations amend services specified under the Cardiac Imaging MoU. These amendments have been recommended by the Cardiac Imaging Management Committee to address a projected overspend in outlays under the MoU. The Cardiac Society of Australia and New Zealand, through the Cardiac Imaging Management Committee, have been consulted about the amendments.
Details of the Regulations are provided in the Attachment.
The Act specifies no conditions that need to be met before the power to make the Regulations may be exercised.
The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The Regulations commence on 1 September 2006.
The Minute recommends that Regulations be made in the form proposed.
Authority:
Subsection 133(1) of the Health Insurance Act 1973
(2)
ATTACHMENT
DETAILS OF THE HEALTH INSURANCE (DIAGNOSTIC IMAGING SERVICES TABLE) AMENDMENT REGULATIONS 2006 (No. 3)
Regulation 1 – Name of Regulations
This regulation provides that the title of the Regulations is the Health Insurance (Diagnostic Imaging Services Table) Amendment Regulations 2006 (No. 3).
Regulation 2 - Commencement
This regulation provides for the Regulations to commence on 1 September 2006.
Regulation 3 – Amendments
This regulation provides that the Health Insurance (Diagnostic Imaging Services Table) Regulations 2005 (the Principal Regulations) are amended as set out in the attached Schedule.
Schedule – Amendments
Schedule 1, Part 3 - Services and Fees
Item [1]
This item reduces the fee for cardiac ultrasound items 55113, 55114 and 55115 from $230.65 to $226.05.
Modelling based on current growth rates shows a projected overspend of at least $12 million by the end of the Cardiac Imaging Memorandum of Understanding (MoU) on 30 June 2008, if action is not taken to reduce expenditure.
Echocardiography services are the main driver of the growth in benefits under the MoU. In the 12 months to March 2006, the number of echocardiography services (items 55113, 55114 and 55115) increased by 12.4% and accounted for 72.5% of total benefits paid under the MoU. To address the projected overspend, the Cardiac Imaging (MoU) Management Committee (CIMC) recommended that from 1 August 2006, the fee for items 55113, 55114 and 55115 be reduced by two percent, from $230.65 to 226.05.
Overview
The Health Insurance (Diagnostic Imaging Services Table) Amendment Regulations 2006 (No. 3), enacted in 2006, were introduced to address a projected overspend in Medicare benefits allocated for cardiac imaging services, specifically echocardiography. The Health Insurance Act 1973 provides for payments of Medicare benefits for diagnostic imaging services, with fees determined by reference to prescribed tables. These Regulations were made under the authority of subsection 133(1) of the Act, which allows the Governor-General to make regulations necessary or convenient to carry out the Act. The policy objective of these Regulations was to reduce fees for certain cardiac ultrasound items by two percent, following recommendations from the Cardiac Imaging Management Committee to curb the escalating costs within the Cardiac Imaging Memorandum of Understanding (MoU). The Regulations commenced on 1 September 2006, reflecting a collaborative effort between the Australian Government and relevant professional bodies to manage Medicare funding effectively.
Scope and Application
The Health Insurance (Diagnostic Imaging Services Table) Amendment Regulations 2006 (No. 3) apply to the management of Medicare benefits for diagnostic imaging services provided to eligible persons under the Health Insurance Act 1973. Specifically, these Regulations address the fees for cardiac ultrasound services, as detailed in the Diagnostic Imaging Services Table. The Regulations were made to implement a two percent reduction in fees for cardiac ultrasound items 55113, 55114, and 55115 to mitigate an anticipated overspend in outlays under the Cardiac Imaging Memorandum of Understanding (MoU) between the Australian Government and professional bodies. The Regulations apply nationally across Australia and are designed to align with the overarching framework established by the Health Insurance Act 1973, with no specific exclusions or thresholds outlined in the explanatory statement. The changes are set to take effect from 1 September 2006, as specified in the Regulations.
Key Provisions
The main operative sections of the Health Insurance (Diagnostic Imaging Services Table) Amendment Regulations 2006 (No. 3) are Regulation 1, which provides the title of the Regulations, and Regulation 3, which amends the Health Insurance (Diagnostic Imaging Services Table) Regulations 2005. The key amendment is in Schedule 1, Part 3 - Services and Fees Item [1], which reduces the fee for cardiac ultrasound items 55113, 55114 and 55115 from $230.65 to $226.05. Regulation 2 specifies the commencement date of these Regulations, which is 1 September 2006.
The Regulations impose obligations on the parties involved in the provision and payment of Medicare benefits for diagnostic imaging services. Specifically, they require a reduction in the fees for cardiac ultrasound items 55113, 55114, and 55115. These obligations are necessary to manage the Medicare outlays for diagnostic imaging services and to address the projected overspend in benefits under the Cardiac Imaging Memorandum of Understanding (MoU). The relevant parties, such as medical practitioners, diagnostic imaging service providers, and the Department of Health and Ageing, must adhere to the new fees as stipulated in the amended table.
There are no explicit offences, penalties, or civil/criminal consequences for breach of these Regulations. However, non-compliance with the amended fees could potentially result in disputes over the correct amount of Medicare benefits payable for the specified cardiac ultrasound services. Such disputes could lead to administrative reviews or legal challenges, although the primary mechanism for enforcement is adherence to the updated fee schedule. The financial implications of non-compliance could include overpayments or underpayments of Medicare benefits, which the Department of Health and Ageing would seek to rectify through audits or other corrective measures. The Regulations are designed to ensure that the Medicare outlays remain within the budgeted limits set out in the MoUs governing diagnostic imaging services.