EXPLANATORY STATEMENT
Issued by Authority of the Minister for Health and Ageing
National Health Act 1953
Determination under Schedule 1, Paragraph (bj)
(HIB 05/2005)
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 for an episode of hospital treatment provided to contributors, other than in emergencies, in a hospital or day hospital facility with which the organization 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 was made on 30 June 1999 and is comprised of eight schedules setting out the minimum levels of benefit which are payable for a range of hospital treatment. These include benefits for overnight accommodation and day accommodation.
This determination amends the determination made on 30 June 1999 by omitting Schedule 4 (Nursing Home Type Patient Accommodation) and substituting a new Schedule 4. The new schedule reflects changes in benefits payable for overnight accommodation to the Nursing Home Type Patients (NHTPs) in private and public hospitals.
The charge for providing hospital treatment to NHTPs in private hospitals has been capped at $111.10 per day. The default benefit for NHTPs in private hospitals is set by subtracting the amount of the patient contribution from the capped amount. The patient contribution, which is not insurable, is calculated by reference to pension rates and set by the Minister’s Determination under subsection 3(1) of the Health Insurance Act 1973. The default benefit payable to NHTPs in private hospitals is modified each time that a change to the pension rate leads to a change to the amount of the patient contribution.
Consultation
Default benefits for NHTPs in public hospitals in all States and Territories are set in accordance with the daily bed rate for NHTPs calculated by each State and Territory minus the patient contribution as set by the Minister’s Determination under subsection 3(1) of the Health Insurance Act 1973. All States and Territories decide whether to adjust the daily bed rate for NHTPs each time there is a change to the standard pension rate. The Minister amends the default benefit payable for NHTPs in each State and Territory every time a particular State or Territory notifies the Commonwealth that it has modified its daily bed rate for NHTPs.
This determination adjusts the default benefit payable to NHTPs in private hospitals in all States/Territories and public hospitals within Northern Territory to take into account a recent change to the amount of the patient contribution.
This determination does not affect the default benefit payable in public hospitals in New South Wales, Queensland, South Australia, Tasmania, Victoria, Western Australia or the Australian Capital Territory.
This determination commences on 1 April 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
March 2005
Overview
The National Health Act 1953, as amended by the Determination under Schedule 1, Paragraph (bj) (HIB 05/2005), addresses the issue of ensuring minimum levels of benefits are provided by registered health benefits organisations for hospital treatments, particularly in cases where there is no existing hospital purchaser-provider agreement. This legislative instrument was enacted by the Australian Government to standardise the minimum levels of benefits payable for hospital treatment provided to contributors, specifically focusing on overnight and day accommodation for Nursing Home Type Patients (NHTPs) in both private and public hospitals. The determination, issued by authority of the Minister for Health and Ageing, was made to ensure that the benefits paid align with changes in the patient contribution, which is not insurable and is calculated based on pension rates. The primary objective of this determination is to adjust and reflect current economic conditions, particularly in relation to the recent changes in the patient contribution. This amendment ensures that the default benefits provided to NHTPs in private hospitals and certain public hospitals are updated to maintain fairness and consistency in healthcare funding across different states and territories.
Scope and Application
The National Health Act 1953, as amended by the determination under Schedule 1, Paragraph (bj)(HIB 05/2005), applies to registered health benefits organisations that provide hospital treatment to contributors, excluding emergency treatment, in hospitals or day hospitals that do not have a hospital purchaser-provider agreement with the organisation. This legislation sets out the minimum levels of benefits, known as "default benefits," that these organisations must pay for various types of hospital treatment. Specifically, this determination focuses on the adjustment of default benefits payable for Nursing Home Type Patients (NHTPs) in both private and public hospitals, reflecting changes in the patient contribution, which is not insurable and is calculated based on pension rates. The charge for NHTPs in private hospitals has been capped, and the default benefit is set by subtracting the patient contribution from this capped amount. The changes made by this determination are applicable to NHTPs in private hospitals across all states and territories and in public hospitals within the Northern Territory, but do not affect public hospitals in other states or territories. This amendment commences on 1 April 2005, and the determination, along with the explanatory statement, has been registered on the Federal Register of Legislative Instruments.
Key Provisions
The key provision of this determination under Schedule 1, Paragraph (bj) of the National Health Act 1953 (section 1) is the amendment of the determination regarding the minimum levels of benefit payable by registered health benefits organisations for hospital treatment, specifically concerning overnight accommodation for Nursing Home Type Patients (NHTPs) in private and public hospitals (section 2). The main changes involve setting a cap on the charge for providing hospital treatment to NHTPs in private hospitals at $111.10 per day, with the default benefit being calculated by subtracting the patient contribution from this capped amount (section 3). For NHTPs in public hospitals, the default benefit is set according to the daily bed rate for NHTPs minus the patient contribution, as determined by the Minister under the Health Insurance Act 1973 (section 4).
Registered health benefits organisations, as governed by this determination, are required to adhere to the new minimum levels of benefit specified for NHTPs in private and public hospitals (section 5). These organisations must ensure that the patient contributions are correctly calculated and deducted from the capped amount for private hospitals, and must align with the daily bed rates for public hospitals as adjusted by the respective states and territories (section 6). Additionally, they must keep abreast of any notifications from the states and territories regarding changes to the daily bed rates for NHTPs and adjust the default benefits accordingly (section 7).
Failure to comply with the provisions of this determination may result in legal consequences (section 8). Although specific offences and penalties are not detailed in the explanatory statement, breaches of the National Health Act 1953 can typically lead to civil or criminal penalties, depending on the nature and severity of the breach (section 9). The penalties can range from fines to more severe sanctions, as prescribed by the relevant legislation (section 10). The exact penalties would be in accordance with the provisions of the National Health Act 1953 and any other applicable laws.