Medicare Guarantee Act 2017

Administered by Department of Health, Disability and Ageing, Department of the Treasury

Legislation au C2017A00071 In force Act

Legislation content

 

 

 

 

 

 

Medicare Guarantee Act 2017

 

No. 71, 2017

 

 

 

 

 

An Act to establish the Medicare Guarantee Fund, and for related purposes

 

 

 

Contents

1 Short title

2 Commencement

3 Simplified outline of this Act

4 Definitions

5 Medicare Guarantee Fund

6 Medicare Guarantee Fund (Treasury) Special Account

7 Credits to the Medicare Guarantee Fund (Treasury) Special Account

8 Credit to the Medicare Guarantee Fund (Treasury) Special Account—budget year beginning on 1 July 2017

9 Credits to the Medicare Guarantee Fund (Treasury) Special Account—later budget years

10 Credits to the Medicare Guarantee Fund (Treasury) Special Account—avoiding funding shortfalls

11 Purpose of the Medicare Guarantee Fund (Treasury) Special Account

12 Medicare Guarantee Fund (Health) Special Account

13 Purposes of the Medicare Guarantee Fund (Health) Special Account

14 Transfer of amounts to the Medicare Guarantee Fund (Health) Special Account

15 Surplus amounts in the Medicare Guarantee Fund (Health) Special Account—transfer to general CRF

16 Delegation by the Treasurer

17 Delegation by the Health Minister

18 Appropriation

 

 

 

Medicare Guarantee Act 2017

No. 71, 2017

 

 

 

An Act to establish the Medicare Guarantee Fund, and for related purposes

[Assented to 26 June 2017]

The Parliament of Australia enacts:

1  Short title

  This Act is the Medicare Guarantee Act 2017.

2  Commencement

 (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

 

Commencement information

Column 1

Column 2

Column 3

Provisions

Commencement

Date/Details

1.  The whole of this Act

The day after this Act receives the Royal Assent.

27 June 2017

Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.

 (2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.

3  Simplified outline of this Act

• This Act establishes the Medicare Guarantee Fund, which consists of:

 (a) the Medicare Guarantee Fund (Treasury) Special Account; and

 (b) the Medicare Guarantee Fund (Health) Special Account.

• The purpose of the Medicare Guarantee Fund (Treasury) Special Account is to ensure that amounts are available for transfer to the Medicare Guarantee Fund (Health) Special Account.

• The purposes of the Medicare Guarantee Fund (Health) Special Account are:

 (a) to make payments of Medicare benefits; and

 (b) to make payments under the Pharmaceutical Benefits Scheme.

• Amounts will be credited to the Medicare Guarantee Fund (Treasury) Special Account and transferred to the Medicare Guarantee Fund (Health) Special Account.

• The transferred amounts will cover:

 (a) payments of Medicare benefits; and

 (b) payments under the Pharmaceutical Benefits Scheme.

4  Definitions

  In this Act:

budget means an annual Commonwealth budget.

budget year means the financial year to which a budget relates.

Health Department means the Department administered by the Health Minister.

Health Minister means the Minister who administers Part II of the Health Insurance Act 1973.

initial credit time for the Medicare Guarantee Fund (Health) Special Account means the first time when an amount is required to be credited to the Medicare Guarantee Fund (Health) Special Account by a direction under subsection 14(1).

Medicare benefit payment means:

 (a) a payment by the Commonwealth under Part II of the Health Insurance Act 1973; or

 (b) a payment by the Commonwealth under an arrangement in force under section 129A of the Health Insurance Act 1973.

Medicare Guarantee Fund (Health) Special Account means the Medicare Guarantee Fund (Health) Special Account established by section 12.

Medicare Guarantee Fund (Treasury) Special Account means the Medicare Guarantee Fund (Treasury) Special Account established by section 6.

PBS payment means a payment by the Commonwealth for the purposes of Part VII of the National Health Act 1953, but does not include expenditure covered by subsection 137(2) of that Act.

registered means registered on the Federal Register of Legislation.

Note: See the Legislation Act 2003.

Treasury Department means the Department administered by the Treasurer.

5  Medicare Guarantee Fund

  The Medicare Guarantee Fund consists of:

 (a) the Medicare Guarantee Fund (Treasury) Special Account; and

 (b) the Medicare Guarantee Fund (Health) Special Account.

6  Medicare Guarantee Fund (Treasury) Special Account

 (1) The Medicare Guarantee Fund (Treasury) Special Account is established by this section.

 (2) The Medicare Guarantee Fund (Treasury) Special Account is a special account for the purposes of the Public Governance, Performance and Accountability Act 2013.

 (3) The Medicare Guarantee Fund (Treasury) Special Account is to be administered by the Secretary of the Treasury Department.

7  Credits to the Medicare Guarantee Fund (Treasury) Special Account

 (1) The Treasurer may, by notifiable instrument, determine that a specified amount is to be credited to the Medicare Guarantee Fund (Treasury) Special Account at a time specified in, or ascertained in accordance with, the determination.

 (2) The time specified in, or ascertained in accordance with, the determination must not be earlier than the commencement of the determination.

 (3) The time specified in, or ascertained in accordance with, the determination must not be earlier than 1 July 2017.

 (4) The determination must be expressed to be for a specified budget year.

8  Credit to the Medicare Guarantee Fund (Treasury) Special Account—budget year beginning on 1 July 2017

 (1) As soon as practicable after the commencement of this section, the Treasurer must make a determination under section 7 that:

 (a) is expressed to be for the budget year beginning on 1 July 2017; and

 (b) provides that a specified amount is to be credited to the Medicare Guarantee Fund (Treasury) Special Account at whichever of the following times is applicable:

 (i) if the determination is registered before 1 July 2017—the start of 1 July 2017;

 (ii) otherwise—the commencement of the determination.

Amount specified in determination

 (2) The amount specified in the determination must be the amount the Treasurer considers to be sufficient to cover the funding of:

 (a) Medicare benefit payments; and

 (b) PBS payments;

for the period:

 (c) beginning when the specified amount is credited in accordance with the determination; and

 (d) ending at the end of the budget year.

9  Credits to the Medicare Guarantee Fund (Treasury) Special Account—later budget years

 (1) As soon as practicable after the release of the budget for:

 (a) the budget year beginning on 1 July 2018; or

 (b) a later budget year;

the Treasurer must make a determination under section 7 that:

 (c) is expressed to be for the budget year; and

 (d) provides that a specified amount is to be credited to the Medicare Guarantee Fund (Treasury) Special Account at whichever of the following times is applicable:

 (i) if the determination is registered before the start of the budget year—the specified time;

 (ii) otherwise—the commencement of the determination.

 (2) The specified time referred to in subparagraph (1)(d)(i):

 (a) must not be later than the start of the budget year; and

 (b) must not be earlier than the commencement of the determination.

Amount specified in determination

 (3) The amount specified in the determination must be the amount the Treasurer considers to be sufficient to cover the funding of:

 (a) Medicare benefit payments; and

 (b) PBS payments;

for the period:

 (c) beginning when the specified amount is credited in accordance with the determination; and

 (d) ending at the end of the budget year.

10  Credits to the Medicare Guarantee Fund (Treasury) Special Account—avoiding funding shortfalls

 (1) If:

 (a) one or more amounts have been credited to the Medicare Guarantee Fund (Treasury) Special Account; and

 (b) at a time during a budget year, the Treasurer is satisfied that the combined balance of that account and the Medicare Guarantee Fund (Health) Special Account is likely to fall short of the amount that the Treasurer considers would be sufficient to cover the funding of:

 (i) Medicare benefit payments; and

 (ii) PBS payments;

  for the remainder of the budget year;

the Treasurer must make a determination under section 7 that:

 (c) is expressed to be for the budget year; and

 (d) provides that a specified amount is to be credited to the Medicare Guarantee Fund (Treasury) Special Account at a specified time.

 (2) The specified time:

 (a) must occur during the budget year; and

 (b) must not be earlier than the commencement of the determination.

Amount specified in determination

 (3) The amount specified in the determination must be the amount that the Treasurer estimates to be the amount of the shortfall.

11  Purpose of the Medicare Guarantee Fund (Treasury) Special Account

  The purpose of the Medicare Guarantee Fund (Treasury) Special Account is to ensure that amounts are available for transfer to the Medicare Guarantee Fund (Health) Special Account under section 14.

12  Medicare Guarantee Fund (Health) Special Account

 (1) The Medicare Guarantee Fund (Health) Special Account is established by this section.

 (2) The Medicare Guarantee Fund (Health) Special Account is a special account for the purposes of the Public Governance, Performance and Accountability Act 2013.

 (3) The Medicare Guarantee Fund (Health) Special Account is to be administered by the Secretary of the Health Department.

13  Purposes of the Medicare Guarantee Fund (Health) Special Account

  The purposes of the Medicare Guarantee Fund (Health) Special Account are as follows:

 (a) to make Medicare benefit payments after the initial credit time for the Medicare Guarantee Fund (Health) Special Account;

 (b) to make PBS payments after the initial credit time for the Medicare Guarantee Fund (Health) Special Account.

Note: See section 80 of the Public Governance, Performance and Accountability Act 2013 (which deals with special accounts).

14  Transfer of amounts to the Medicare Guarantee Fund (Health) Special Account

 (1) If, at a particular time, the balance of the Medicare Guarantee Fund (Treasury) Special Account is greater than zero, the Treasurer must, in writing, direct that an amount equal to the balance is to be:

 (a) debited from the Medicare Guarantee Fund (Treasury) Special Account; and

 (b) credited to the Medicare Guarantee Fund (Health) Special Account;

as soon as practicable after the direction is given.

 (2) A direction under subsection (1) is not a legislative instrument.

15  Surplus amounts in the Medicare Guarantee Fund (Health) Special Account—transfer to general CRF

 (1) After the initial credit time for the Medicare Guarantee Fund (Health) Special Account, the Health Minister may, by notifiable instrument, direct that a specified amount is to be debited from the Medicare Guarantee Fund (Health) Special Account on a specified day.

 (2) The specified day must not be earlier than the commencement of the direction.

 (3) The Health Minister must not give a direction under subsection (1) that specifies a day in a budget year unless:

 (a) the Health Minister has estimated that the balance of the Medicare Guarantee Fund (Health) Special Account as at the end of the budget year (reduced by any amounts credited to that account for a later budget year) is likely to be a particular amount; and

 (b) the amount specified in the direction is equal to, or less than, the estimated amount.

 (4) For the purposes of paragraph (3)(a), if:

 (a) an amount is credited to the Medicare Guarantee Fund (Treasury) Special Account under a section 7 determination for a budget year; and

 (b) as a result, under a section 14 direction, an amount equal to that amount is:

 (i) debited from the Medicare Guarantee Fund (Treasury) Special Account; and

 (ii) credited to the Medicare Guarantee Fund (Health) Special Account;

the amount credited to the Medicare Guarantee Fund (Health) Special Account is taken to have been credited for the budget year.

16  Delegation by the Treasurer

 (1) The Treasurer may, by writing, delegate any or all of his or her functions or powers under this Act to:

 (a) the Secretary of the Treasury Department; or

 (b) an SES employee, or acting SES employee, in the Treasury Department.

Note: The expressions SES employee and acting SES employee are defined in section 2B of the Acts Interpretation Act 1901.

 (2) In exercising powers under a delegation under subsection (1), the delegate must comply with any directions of the Treasurer.

17  Delegation by the Health Minister

 (1) The Health Minister may, by writing, delegate any or all of his or her functions or powers under this Act to:

 (a) the Secretary of the Health Department; or

 (b) an SES employee, or acting SES employee, in the Health Department.

Note: The expressions SES employee and acting SES employee are defined in section 2B of the Acts Interpretation Act 1901.

 (2) In exercising powers under a delegation under subsection (1), the delegate must comply with any directions of the Health Minister.

18  Appropriation

  If, at any time after the initial credit time for the Medicare Guarantee Fund (Health) Special Account, the balance of that account is insufficient to cover:

 (a) a Medicare benefit payment that is about to be made; or

 (b) a PBS payment that is about to be made;

the Consolidated Revenue Fund is appropriated for the purposes of making the Medicare benefit payment or PBS payment, as the case requires.

 

 

 

 

[Minister’s second reading speech made in—

House of Representatives on 1 June 2017

Senate on 19 June 2017]

 

(118/17)

 

Overview

The Medicare Guarantee Act 2017, enacted by the Parliament of Australia and assented to on 26 June 2017, was introduced to establish the Medicare Guarantee Fund, which comprises the Medicare Guarantee Fund (Treasury) Special Account and the Medicare Guarantee Fund (Health) Special Account. This Act aims to ensure the availability of funds to cover Medicare benefit payments and payments under the Pharmaceutical Benefits Scheme. The Medicare Guarantee Fund (Treasury) Special Account is intended to hold amounts that are to be transferred to the Medicare Guarantee Fund (Health) Special Account, which will then be used to make the necessary payments. The Treasurer has the authority to credit specified amounts to the Medicare Guarantee Fund (Treasury) Special Account to ensure there are sufficient funds to cover these payments. The policy objective of the Act is to secure the long-term financial sustainability of Medicare by providing a dedicated funding source that can be reliably used for the payment of Medicare benefits and PBS payments. This ensures that the healthcare needs of Australians are met without interruption, thereby maintaining the integrity and accessibility of the Medicare system. The Act also allows for the transfer of surplus amounts from the Medicare Guarantee Fund (Health) Special Account to the general Consolidated Revenue Fund, subject to certain conditions and estimates.

Scope and Application

The Medicare Guarantee Act 2017 applies to the Commonwealth of Australia and concerns the establishment and management of the Medicare Guarantee Fund, which includes the Medicare Guarantee Fund (Treasury) Special Account and the Medicare Guarantee Fund (Health) Special Account. The Act is applicable to the entities responsible for the administration of these accounts, which are the Treasury Department and the Health Department respectively, and to the individuals holding the offices of the Treasurer and the Health Minister. The Act sets out the process for crediting and transferring funds between these accounts, ensuring the availability of funds to cover Medicare benefit payments and Pharmaceutical Benefits Scheme (PBS) payments. The geographic reach of the Act is national, as it pertains to the Commonwealth's financial arrangements and obligations under Medicare and the PBS. There are no stated exclusions, exemptions, or thresholds within the Act itself, but the administration and operation of the fund are subject to the broader provisions of the Public Governance, Performance and Accountability Act 2013. The Act also allows for the delegation of functions and powers by both the Treasurer and the Health Minister to specified employees within their respective departments.

Key Provisions

The Medicare Guarantee Act 2017 (C2017A00071) establishes the Medicare Guarantee Fund, which comprises two special accounts: the Medicare Guarantee Fund (Treasury) Special Account and the Medicare Guarantee Fund (Health) Special Account. The primary role of the Medicare Guarantee Fund (Treasury) Special Account, as outlined in sections 6 and 7, is to ensure funds are available for transfer to the Medicare Guarantee Fund (Health) Special Account, established in section 12. The latter account is intended to fund Medicare benefit payments and payments under the Pharmaceutical Benefits Scheme, as stated in section 13. The Act imposes specific obligations on the Treasurer and the Health Minister. Under section 7, the Treasurer is required to determine the crediting of specified amounts to the Medicare Guarantee Fund (Treasury) Special Account, with these credits needing to occur at specified times or as determined by the Treasurer. Section 8 mandates the Treasurer to make an initial credit determination for the budget year beginning on 1 July 2017, with subsequent credits to be determined as soon as practicable after the release of each subsequent budget, as outlined in section 9. If during any budget year the combined balance of the two accounts falls short of the required funding, the Treasurer must make an additional credit determination to cover the shortfall, as stipulated in section 10. The purpose of the Medicare Guarantee Fund (Treasury) Special Account is clearly to maintain adequate funding for the Medicare Guarantee Fund (Health) Special Account, as noted in section 11. Section 14 outlines the process for transferring amounts from the Medicare Guarantee Fund (Treasury) Special Account to the Medicare Guarantee Fund (Health) Special Account, which must occur as soon as practicable after the Treasurer's direction. The Health Minister has the authority under section 15 to direct the debiting of surplus amounts from the Medicare Guarantee Fund (Health) Special Account, provided the specified day for this action does not fall within the budget year unless certain conditions are met, as detailed in the subsections. The Act also includes provisions regarding delegation of powers. Section 16 allows the Treasurer to delegate any functions or powers under this Act to the Secretary of the Treasury Department or an SES employee in the Treasury Department. Similarly, section 17 allows the Health Minister to delegate their functions or powers to the Secretary of the Health Department or an SES employee in the Health Department. Both delegations require the delegate to comply with any directions given by the respective minister. In terms of consequences for non-compliance, the Act does not explicitly state offences or penalties for breach. However, the appropriation provision in section 18 indicates that if the Medicare Guarantee Fund (Health) Special Account does not have sufficient funds to cover an impending Medicare benefit payment or PBS payment, the Consolidated Revenue Fund will be appropriated for that purpose. This ensures that payments under Medicare and the Pharmaceutical Benefits Scheme will not be interrupted, highlighting the critical importance of maintaining adequate funds in the Medicare Guarantee Fund (Health) Special Account.

Legal classification tags

Area of Law
Finance & Banking Law
Instrument
Act
Concepts
Definitions & Interpretation
Commencement Provisions
Delegation by the Treasurer
Delegation by the Health Minister
Credits to the Medicare Guarantee Fund (Treasury) Special Account
Appropriation

Interactions

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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.