Medicare Australia (Functions of Chief Executive Officer) Amendment Direction 2005 (No. 1)

Administered by Services Australia

Legislation au F2005L03254 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

 

Issued by the authority of the Minister for Human Services

 

Medicare Australia Act 1973

 

Direction

 

Background

 

Section 4 of the Medicare Australia Act 1973 (the Act) establishes Medicare Australia.  Sections 5 and 8AG of the Act create the office of Chief Executive Officer of Medicare Australia (CEO), with statutory functions.  The CEO is, under the Minister for Human Services and through the Secretary to the Department of Human Services, responsible for managing Medicare Australia.

 

Medicare Australia (formerly the Health Insurance Commission) is a specialist service delivery agency and has substantial experience in processing claims and making payments to beneficiaries of the Government’s major health programs.

 

Section 5 of the Act sets out a number of mechanisms for conferral of functions on the CEO.  Paragraph 5(1)(d) of the Act provides that the CEO has any functions that the Minister for Human Services, by writing, directs the CEO to perform.

 

The original Medicare Australia (Functions of Chief Executive Officer) Direction 2005 (the Direction) signed by the Minister for Human Services on 30 September 2005, made directions under paragraph 5(1)(d) of the Act.  The Direction conferred a number of functions on Medicare Australia, which reflected the activities undertaken by the former Health Insurance Commission prior to amendments to the Act implementing new governance arrangements.  Generally the functions conferred were to deliver certain health-related services and undertake other health-related regulatory and administrative responsibilities.

 

Paragraph 5(1)(e) of the Act provides that the CEO has any functions that are prescribed.  Pursuant to paragraph 5(1)(e) of the Act, certain aged care payments and related functions under the Aged Care Act 1997 (Aged Care Act) were prescribed as functions of the CEO under the Medicare Australia Regulations 1975 (the Regulations).

 

The purpose of the Medicare Australia (Functions of Chief Executive Officer) Amendment Direction 2005 (No 1) (the Amending Direction) is for the Minister for Human Services to amend the Direction to ensure the previous conferral of functions on Medicare Australia more closely reflect the activities and work undertaken by Medicare Australia.  The Amending Direction also confers on Medicare Australia a number of functions to make aged care payments to supplement those functions conferred by the Regulations.

 

The Minister for Human Services has also directed the CEO of Medicare Australia to perform the functions in the manner set out in the Medicare Australia (Performance of Chief Executive Officer’s Powers and Functions) Direction 2005 under section 8 of the Act.  No amendments have been made to that document resulting from the Amending Direction.

 

Details of Direction

 

Section 1 – Name of Direction

 

This section provides for the Amending Direction to be named the “Medicare Australia (Functions of Chief Executive Officer) Amendment Direction 2005 (No 1)”.

 

Section 2 – Commencement

 

This section provides for the Amending Direction to commence on the day it is registered as a legislative instrument.

 

Section 3 – Amendment of Medicare Australia (Functions of Chief Executive Officer) Direction 2005

 

This section provides that the Direction is amended as set out in Schedule 1.

 

Schedule 1 – Amendments

 

Item [1] – Paragraph 4(2)(e)

 

This item ensures that Medicare Australia has the function to make directions on behalf of the Minister for Health and Ageing (not just to advise in relation to directions) under section 19D of the Health Insurance Act 1973.

 

Item [2] – Sub-subparagraph 14(3)(j)(i)(B)

 

This item ensures that Medicare Australia has the function to nominate (and revoke nominations of) persons for appointment to the Medicare Participation Review Committees under subsection 124EA of the Health Insurance Act 1973.

 

Item [3] – Section 26

 

This item removes the functions for the CEO to make contractual payments to Diabetes Australia (for the purposes of funding the National Diabetic Supplies Scheme), which is a function that is not performed by the CEO, and was not previously performed by the former Health Insurance Commission.

 

Item [4] – After section 33

 

This item inserts a new section 34 “Functions in relation to payments”.  This section contains provisions relating to the conferral of functions on the CEO to make specified aged care payments, which will primarily be administered by the Department of Health and Ageing.  The section will include the following functions:

 

Section 34 – Functions in relation to payments

Section 34 provides that the CEO has the function to make payments as directed by the Department of Health and Ageing in relation to the following:

 

  • the program for Day Therapy Centres;
  • grants approved under sections 55 and 58CE of the National Health Act 1953 in relation to 'new or rebuilt nursing homes' and 'upgraded nursing homes’ (also known as “Additional Recurrent Funding” grants); and
  • the program for Capital Transition Payments.

 

Section 34 also provides for additional amounts which are payable in circumstances specified by the Minister for Health and Ageing, pursuant to section 60 of the Aged Care (Consequential Provisions) Act 1997, in relation to certain residential care services (as defined in the Regulations).

 

Section 34 also provides that the CEO has the function to take action to recover overpayments of amounts paid in relation to the above payments

 

Consultation

 

The Direction was settled after consultation with the Department of Health and Ageing. Consultation with the aged care sector and wider community was unnecessary as the amendments are minor or machinery in nature and do not substantially change the law.

 

The Direction is a legislative instrument for the purposes of the Legislative Instruments Act 2003.

 

The Direction is not subject to the sunsetting regime (under which instruments automatically cease after 10 years) under Part 6 of the Legislative Instruments Act 2003.

Overview

The Medicare Australia (Functions of Chief Executive Officer) Amendment Direction 2005 (No 1) was enacted to refine the functions conferred on the Chief Executive Officer of Medicare Australia, aligning them more closely with the agency’s ongoing activities and responsibilities. This amendment was introduced by the Minister for Human Services under the authority of the Medicare Australia Act 1973, aiming to ensure that the functions performed by Medicare Australia more accurately reflect its current operations. The Direction was established to address gaps and discrepancies in the initial conferral of functions, ensuring that the CEO has the appropriate authorities to deliver health-related services effectively. This includes specific functions related to making aged care payments and related activities, which are primarily administered by the Department of Health and Ageing. The enacting body is the Minister for Human Services, who issued the Direction after consultation with relevant departments, ensuring the amendments were of a minor or machinery nature and did not substantially alter existing legislation.

Scope and Application

The Medicare Australia (Functions of Chief Executive Officer) Amendment Direction 2005 (No 1) applies to the Chief Executive Officer (CEO) of Medicare Australia, who is responsible for managing the agency under the direction of the Minister for Human Services. The Direction delineates the functions and responsibilities of the CEO, reflecting the activities undertaken by Medicare Australia in delivering health-related services and regulatory functions. Geographically, the Act and the Direction pertain to the Commonwealth level of government in Australia, affecting operations across the nation. The Direction specifies the functions conferred upon the CEO, including those related to making certain aged care payments and performing other administrative duties under various health-related acts and regulations. The Direction does not explicitly state exclusions or thresholds but instead focuses on prescribing specific functions that align more closely with the current activities of Medicare Australia. The application of the Direction is further refined through subordinate instruments, such as the Medicare Australia (Performance of Chief Executive Officer’s Powers and Functions) Direction 2005, which outlines the manner in which the CEO is to perform their functions.

Key Provisions

The Medicare Australia (Functions of Chief Executive Officer) Amendment Direction 2005 (No 1) (the Amending Direction) amends the Medicare Australia (Functions of Chief Executive Officer) Direction 2005 (the Direction) to reflect the current activities and work undertaken by Medicare Australia. Section 34 of the Amending Direction inserts a new section 34, which confers on the Chief Executive Officer (CEO) of Medicare Australia the function to make payments as directed by the Department of Health and Ageing in relation to the program for Day Therapy Centres, grants approved under sections 55 and 58CE of the National Health Act 1953 (Additional Recurrent Funding grants), the program for Capital Transition Payments, and additional amounts payable in relation to certain residential care services. This section also provides for the CEO to take action to recover overpayments made in relation to the above payments. The Amending Direction also ensures that Medicare Australia has the function to make directions on behalf of the Minister for Health and Ageing under section 19D of the Health Insurance Act 1973 and to nominate (and revoke nominations of) persons for appointment to the Medicare Participation Review Committees under subsection 124EA of the Health Insurance Act 1973. The Act imposes several obligations on the CEO of Medicare Australia. Under section 5 of the Act, the CEO must perform any functions that the Minister for Human Services directs the CEO to perform. The CEO must also perform any functions that are prescribed under paragraph 5(1)(e) of the Act. The CEO is responsible for managing Medicare Australia and ensuring that the functions conferred on the agency are performed effectively and in accordance with the law. The CEO must also ensure that the agency complies with any directions issued by the Minister for Health and Ageing and take action to recover overpayments of amounts paid in relation to the specified aged care payments. Breach of the provisions of the Act or the Direction may result in civil or criminal consequences. For example, under section 19D of the Health Insurance Act 1973, a person who contravenes a direction made under that section is guilty of an offence and liable to a penalty of up to 50 penalty units (currently AUD 11,000). Similarly, under section 124EA of the Health Insurance Act 1973, a person who contravenes a provision of the Act in relation to the nomination of persons for appointment to the Medicare Participation Review Committees is guilty of an offence and liable to a penalty of up to 50 penalty units. Failure to recover overpayments of amounts paid in relation to the specified aged care payments may also result in civil or criminal consequences, depending on the circumstances of the breach. The maximum penalties for offences under the Act and related legislation may be higher for corporations, depending on the nature and extent of the offence.

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Administrative Law
Health Law
Instrument
Direction
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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.