EXPLANATORY STATEMENT

Issued by Authority of the Minister for Health and Ageing

National Health Act 1953

Determination under Schedule 1, paragraph (1)(bj)

(HIB 16/2006)

Schedule 1, paragraph (1)(bj) of the National Health Act 1953 (the Act) provides that the Minister may determine the minimum levels of benefits payable by a registered health benefits organization (RHBO) for hospital treatment provided to contributors, other than in emergencies, in a hospital or day hospital facility with which the RHBO does not have a hospital purchaser-provider agreement (HPPA) which covers such treatment. These benefits are known in the industry as “default benefits”. 

This determination repeals and replaces the determination made on 18 April 2006 (HIB 14/2006).  Rather than registering the principal determination and registering all subsequent amendments to the principal determination on the Federal Register of Legislative Instruments as required under the Legislative Instruments Act 2003, I have pursued the alternative option allowed under the Legislative Instruments Act 2003 of repealing and remaking the determination in a consolidated form.

This determination is comprised of seven Schedules setting out the minimum levels of benefit which are payable for a range of hospital treatment.  Namely, benefits for overnight accommodation (Schedules 1 and 2), same day accommodation (Schedule 3), nursing-home type patients (Schedule 4), second tier benefits (Schedule 5), care plans and case conferencing (Schedule 6) and outreach services (Schedule 7).

Schedules 1, 3 and 6

Schedule 1 sets default benefits for overnight accommodation in certain situations by specifying the default benefits that payable in relation to Medicare Benefits Schedule (MBS) item numbers.  Schedule 1 categorises MBS item numbers into patient classifications (e.g. Advanced Surgical, Surgical/Obstetric or Other Patient).

The new Schedule 1 has been amended by adding and deleting MBS item numbers to reflect equivalent changes made to the 1 November 2005 MBS effective on and from 1 May 2006.

Schedule 1 has been amended to specify that advanced surgical patients are those defined as undergoing a procedure with an MBS fee greater than $738.22 and surgical patients are those defined as undergoing a procedure with an MBS fee within the range of $219.81 to $738.22.  This amendment ensures that new MBS surgical procedures are correctly located in either the advanced surgical or surgical classifications. 

Minor amendments were made to remove four sleep apnoea non-surgical MBS items which were inadvertently placed in the surgical obstetric classification.

Schedule 3 sets the default benefits payable for same day accommodation in hospitals and day hospital facilities in all States and Territories by specifying the default benefits that are payable in relation to MBS item numbers.  Schedule 3 also specifies procedures that do not normally require admission to hospital or a day hospital facility and therefore no default benefits are payable. 

The amendments to Schedule 3 specifies new MBS items that do not normally require admission to hospital or a day hospital facility.  The amendment also deletes MBS items that have been removed from the MBS.

Schedule 6 sets out the level of benefits payable for Care Plans and Case Conferencing in hospitals and day hospital facilities in all States and Territories.  Schedule 6 has been amended to include new MBS care plans and case conferencing to be undertaken in hospitals and day hospital facilities.

These changes were necessary because Schedules 1, 3 and 6 link the default benefits that are payable to the types of professional services rendered to admitted hospital patients.  The types of professional services rendered are identified by reference to MBS item numbers and fees.

Consultation

The changes to the MBS resulted from reviews by the Medicare Consultative Committee (MBCC). The MBCC is an informal consultative forum with representation drawn from the Department of Health and Ageing, Medicare Australia, the Australian Medical Association and relevant professional groups of the medical profession. The reviews conducted by the MBCC are designed to ensure that the MBS reflects current medical practice and encourages best practice.

The changes to Schedules 1, 3 and 6 were necessary to ensure that health funds, at a minimum, pay the ‘default benefit’ for their members where members receive hospital treatment corresponding to one of the new MBS item numbers, in a hospital where that health fund does not have a contractual arrangement with that hospital. These amendments to Schedules 1, 3 and 6 are of a machinery nature and do not substantially alter existing arrangements.
 

This determination commences on 1 May 2006.  This determination and this explanatory statement have been lodged for registration on the Federal Register of Legislative Instruments.

PRIVATE HEALTH INSURANCE BRANCH

DEPARTMENT OF HEALTH AND AGEING

MAY 2006