EXPLANATORY STATEMENT
Issued by Authority of the Minister for Health and Ageing
National Health Act 1953
Determination under Schedule 1, Paragraph (bj)
(HIB 03/2005)
Paragraph (bj) of Schedule 1 to the National Health Act 1953 (the Act) provides that the Minister may determine the minimum levels of benefit payable by a Registered Health Benefits Organization (RHBO) for an episode of 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 which covers such treatment. These benefits are known in the industry as “default benefits”.
The current Determination made on 30 June 1999 comprises eight schedules setting out the minimum levels of benefit which are payable for a range of hospital treatment. These include benefits for overnight accommodation, day accommodation, prostheses and second tier default benefits.
Schedule 5 (Benefits Payable in Respect of Prostheses and Human Tissues) of the current Determination has two parts:
- Part A – Prostheses; and
- Part B – Human Tissues.
Schedule 5 prescribes the prostheses and human tissues that RHBOs must fully fund for their members who have taken out a policy under which benefits are payable for the items.
For prostheses the benefit payable is the charge for the item negotiated between the RHBO and one only of the manufacturer, supplier or hospital (or their agent).
For human tissues the benefit payable is set by the Minister with reference to applications from suppliers.
This determination amends the determination made on 30 June 1999 by omitting Schedule 5 (Benefits Payable in Respect of Surgically Implanted Prostheses and Human Tissue Items and Other Medical Devices) and substituting a new Schedule 5 (Benefits Payable in Respect of Prostheses and Human Tissues).
In the new Schedule 5, items that were previously listed as Other Medical Devices in Appendix C have been incorporated with Surgically Implanted Prostheses formerly listed in Appendix A. The two appendices combined are now known as Part A – Prostheses.
The Department of Health and Ageing assesses applications from manufacturers and suppliers to include items in Schedule 5 in February and August of each year.
Schedule 5 is then amended as necessary. This determination substitutes the Schedule 5 of August 2004 for a Schedule that incorporates the changes required as a result of the applications assessed for February 2005.
The new Schedule 5 modifies the previous Schedule by:
- adding a number of new items;
- changing some existing items including: amending the descriptions of items already on the Schedule to correct errors or to add new sizes or models, allocating new billing codes in respect of new sizes or models of products, compressing billing codes to cover a range of items offered at the same cost, changing supplier names to reflect new supplier arrangements; and
- deleting other items.
The new Schedule 5 also modifies the previous Schedule by changing the structure of listing items in Part A – Prostheses. Some items have been listed according to groupings based on their clinical effectiveness, as assessed by Clinical Advisory Groups (CAGs). The purpose of the groupings is to identify products of similar clinical effectiveness or clinical design, in order to assist in determining the benefits payable for the products and to assist with clinical choice. To date, four CAGs have reviewed and grouped existing and new products on the Schedule in the following categories:
- cardiac pacemakers and leads;
- implantable cardioverter defibrillators and leads;
- cardiac stents;
- intraocular lenses;
- hip prostheses; and
- knee prostheses.
Other items have been grouped according to their product type, as determined by the Emergency Care Research Institute (ECRI) or Global Medical Devices Nomenclature System (GMDNS) descriptor allocated by the Therapeutic Goods Administration. This is to allow for greater ease of comparison of products available.
CONSULTATION
This determination has been made having regard to advice provided by the Prostheses and Devices Committee (PDC), a ministerially appointed committee comprised of members from the major stakeholder groups – the Australian Health Insurance Association, the Australian Private Hospitals’ Association, Catholic Health Australia, the Australian Medical Association, the Consumers’ Health Forum, the Medical Industry Association of Australia and the Commonwealth Department of Veterans’ Affairs. The PDC considered the applications for listing of new products and applications for changes to existing listings and made recommendations.
The determination takes effect on 14 March 2005. The 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
FEBRUARY 2005